Features of the procedure for returning simplified tax payers of different groups to the taxation systems they were in before the selection of taxation features and the risks of non-compliance with this procedure

Properties of the peculiarities of taxation before the termination or cancellation of the martial law, state of emergency

From April 1, 2022, until the termination or abolition of the state of war or emergency in the territory of Ukraine, special features of taxation have been temporarily established for taxpayers of the single tax of the first-third groups, according to which, simple persons in the first and second groups have the right not to pay the single tax, and simple persons in the third group have the right not to pay (individuals and legal entities) a rate of 2 percent of income and suspension of VAT registration of VAT payers is established. (Clause 9 of subsection 8 of chapter XX of the PC of Ukraine).

Taxpayers are not obliged, but can take advantage of the special features of taxation, including by transferring from other groups of the simplified or general taxation system, by submitting an application to the supervisory authority.

The procedure for returning simplified taxpayers of different groups to the taxation systems they were in before the selection of taxation features

Taxpayers of the first - third groups on the simplified taxation system are returned to the taxation systems they were in before the selection of taxation features in accordance with the procedure provided for in clause 9.9 of clause 9 of subsection 8 of chapter XX of the Code of Ukraine.

The return differs between automatic and independent.

Automatic refund is provided only for single tax payers of the third group, including those who switched from others to use the features of taxation in the third group, and independent - for all groups of single tax payers.

Automatic return is carried out without the will and participation of taxpayers in the return procedure who, from the first day of the month following the termination or cancellation of the martial law or state of emergency on the territory of Ukraine, lose the right to use the special features of taxation and are automatically considered to be applying the taxation system in which they were before choosing the features of taxation.

Self-return is provided only by submitting an application by taxpayers of the first-third groups to refuse to use the special features of taxation from the first day of the month following the month in which such a decision was made. That is, regardless of the termination or cancellation of the military, state of emergency on the territory of Ukraine and will not allow to use the special features of taxation again during the year.

So, the simplified taxpayers in the third group, who use the special features of taxation from the first day of the month following the month of termination or cancellation of the state of war or emergency in the territory of Ukraine, are automatically returned to the taxation system before using the special taxation features, and the simplified taxpayers in the first and second groups only upon application.

Risks of non-compliance with the procedure for returning the termination or cancellation of the martial law, state of emergency

At the same time, in accordance with the formed traditions of the rule-making culture in Ukraine, it is necessary to take into account the fact that the day of termination or cancellation of the state of war or state of emergency on the territory of Ukraine may not be determined on the last day of the month, but at the beginning or in the middle, for example.

Thus, the simplified taxpayers in the third group have no risk of return, and the simplified taxpayers in the first and second groups risk being on the general taxation system in case of failure to submit such statements by the end of the month before the month in which the state of war or emergency in the territory of Ukraine ends or is canceled, provided that such a state will not end on the last day of the month.

Roman Truskavetsky LegalHelp

Translated from Ukrainian using Google translator