GOLAW Partner Iryna Kalnytska spoke at the ‘11th Annual International Taxation in CEE’ online conference which took place on December, 3-4. The event was devoted to the discussion of recent changes in tax planning, mandatory disclosure rules,, managing tax audits, tax risks, transfer pricing guidelines and case studies on tax compliance in Central and Eastern Europe.
Iryna delivered the presentation on ‘Ukrainian Tax Reform 2020: BEPS implementation in Ukraine’. The speaker focused on the recently adopted in Ukraine Law No. 466, which aims to implement the main measures under the BEPS Project, and its consequences for foreign businesses operating in Ukraine.
In particular, Iryna paid attention to the new rules of taxation for non-residents, which made the presence of the latter in Ukraine much more difficult without a permanent establishment. Thus, among the сhanges the non-residents should already take into account – a) from July 1, 2021, tax audits of non-residents conducting their commercial activities through permanent establishments in Ukraine will be allowed for carrying out; b) by January 1, 2021, non-residents operating in Ukraine, including through permanent establishments, are obliged to register in Ukrainian tax authorities.
Iryna also discussed the changes in application of Double Tax Treaties and introduction of the “principal purpose” test. ‘In certain cases, a taxpayer will have to prove that the principal purpose of a transaction is not tax evasion, otherwise, the company will have to pay the 15% WHT’, the speaker commented.