On May 29, 2020, the Law On Amendments to the Tax Code of Ukraine and Other Laws of Ukraine Regarding Additional Support to Taxpayers for the Period of Undertaking Measures Aimed at Preventing an Outbreak and Spread of the Coronavirus Disease (COVID-19) (the "Law") entered into force.
What does it mean?
The Law extends existing tax reliefs and introduces certain new ones.
The key highlights of the Law are as follows:
- Personal Income Tax ("PIT"). Military Tax ("MT")
► The amounts of PIT paid from the 300% bonus on healthcare practitioners' salaries for the period from May 1, 2020 until June 30, 2020 will be fully refunded from the state budget.
► Starting from April 2, 2020, compensations for partial unemployment caused by the COVID-19 pandemic are not subject to PIT and MT.
- Excise Tax
► Until the last calendar day of the month in which the quarantine is terminated, the excise tax levied on ethanol utilized for the production of disinfectants is set at UAH 0 per 1 liter.
- Unified Social Contribution ("USC")
► From March 1, 2020 through to May 31, 2020, individual entrepreneurs are exempt from the obligation to pay the USC for themselves.
► Fines for the violation of tax legislation (the USC legislation) will not apply to violations taking place during the period from March 1, 2020 until the last calendar day of the month in which the quarantine is terminated. At the same time, violations in the following areas are not covered by the exemption from liability: VAT, excise tax, royalty tax, alienation of pledged property, long-term life insurance, operations with ethanol, fuel, alcohol and tobacco products.
► No late payment interest will be charged from March 1, 2020 until the last calendar day of the month in which the quarantine is terminated. Late payment interest accrued during this period must be written-off.
- Tax audits
► Temporary moratorium on tax audits subject to few exceptions is pushed back to the last calendar day of the month in which the quarantine is terminated.
► Suspension of the tax audits commenced prior to March 18, 2020 is extended until the last calendar day of the month in which the quarantine is terminated.
- Limitation period
► Running of tax limitation periods is suspended for the period from March 18, 2020 until the last calendar day of the month in which the quarantine is terminated.
- Suspension of statutory terms
► The following statutory terms are suspended until the last calendar day of the month in which the quarantine is terminated:
- terms established for filing and consideration of administrative appeals (except for certain VAT-related claims);
- terms established for issuance of tax rulings in writing by the tax office;
- terms established for taxpayers to provide responses to the tax office's inquiries (except for certain VAT-related inquiries).