Taxation, Accounting and Reporting

This is a special mechanism for collecting taxes and fees, which establish a replacement payment of certain taxes and duties on the single tax in the manner and on terms defined by the Code while conducting simplified accounting and reporting.

Entities applying the simplified system of taxation, accounting and reporting, are divided into four groups of single taxpayers.

The conditions under which legal entities of any form of property can take advantage of this system of taxation accounting and reporting are:

- An average number of employees does not exceed 50 persons;

- The amount of income does not exceed 5 million.

These conditions relate to the fourth group of single taxpayers.

This average number of employees for purposes of applying the simplified system of accounting and reporting is determined by taking into account all employees and persons working under civil contracts and part-time over one calendar month, and employees of agencies, branches, offices and other separate units in terms of full employment, except employees who are on leave due to maternity leave and child care until they reach the legally prescribed age.

The amount of income includes any income, including income of agencies, branches, departments of such entity received during the tax (reporting) period in cash (cash and / or non-cash); tangible or intangible form. The amount of income for the reporting period included the amount payable under which the limitation period has expired, and the value obtained free of charge during the period of goods (and services).

During the sale of fixed assets by legal entities – payers of single tax income is defined as the difference between the amount of funds received from sale of fixed assets and their net book value prevailing on the date of sale.

Tax Code determined the limits as for the application of the simplified tax system.

Can not apply the simplified tax system:

1) the activity of the organization of gambling;

2) foreign currency exchange;3) manufacture, export, import, sale of excisable goods (except retail sales of oil products in containers with 20 liters and of individuals with the retail sale of beer and table wine);

4) mining, production, implementation of precious metals and precious stones, including organic formation;

5) production, realization of mineral resources;

6) activity in financial intermediation, except the activity of insurance, which is made by insurance agents and defined by the Law of Ukraine “On Insurance”, by surveyors, commissioners;

7) the activities of companies’ management;

8) the activities of Post and telecommunication services;

9) the activity of selling arts and antiques, activities of bidding (auction) works of art, collectibles or antiques;

10) the activities of the organization of the tour events;

Payers of single tax to make payments for shipped goods (performed work, rendered services) only in cash (cash and / or non-cash).

The interest rate of single tax for the third and fourth groups pay the tax is set at:

1) 3 percent of revenue in the case of payment of value added tax under the Code;

2) 5 percent of income – if the inclusion of value added tax to the single tax.

If the company exceeds the number of employees or the maximum amount of income in the reporting quarter, the amount of excess tax paid at double the rate (6% or 10%) and starting next quarter, it must move to a common system of taxation, accounting and reporting.

Single tax payers in the fourth group performed within 10 calendar days after the deadline of submission of tax returns for the tax (reporting) quarter.

As a result of economic activity for the reporting (tax) period (quarter) entities – legal entities submit to the state tax authority to the 20th day of the month following the reporting (tax) period, tax return single tax payer and if they elect single tax at the rate of 3 percent, every month is given the declaration of VAT.

Single tax payers are exempt from duty charges, payments and filing tax returns of following taxes and fees:

1) corporate income tax;

2) income tax of individuals with income (the object of taxation), which is derived from business activities of person and taxed;

3) value of added tax on transactions of goods and services supply, place of delivery which is located within the customs territory of Ukraine, except for value added tax paid by individuals and entities that have chosen single tax rate of 5%;

4) land tax, except the land tax for land that does not use them for business activity;

5) the fee for certain types of business;

6) the fee for the development of viticulture, horticulture and hop.