Is the basis for accrual of levy for the one-time (special) voluntary declaration an individual’s income received from entrepreneurial activities...?
Is the basis for accrual of levy for the one-time (special) voluntary declaration an individual’s income received from entrepreneurial activities, without state registration as an individual – entrepreneur and, accordingly, without payment of taxes, levies (mandatory payments), including as a result of an act containing signs of a criminal offense and / or in respect of which a pre-trial investigation or trial has been initiated?
Law of Ukraine as of 15.06.2021 № 1539-IX “On amendments to the Tax Code of Ukraine and other laws of Ukraine to stimulate un-shadowing of income and increase citizens’ tax culture by introducing the one-time (special) voluntary declaration of assets belonging to individuals and payment of one-time levy of the budget” (hereinafter – Law № 1539) made amendments to the Tax Code of Ukraine as of 02.12.2010 № 2755-VI with changes and amendments (hereinafter – TCU), particularly in Section XX “Transitional Provisions” was amended with Sub-section 94.
Paragraph 1 Sub-section 94 Section XX “Transitional provisions” of the TCU stipulates that the one-time (special) voluntary declaration is a special procedure for voluntary individual’s declaration of assets located on the territory of Ukraine and / or abroad, if such individual’s assets were received (acquired) by at the expense of income subject to taxation at the time of their accrual (receipt) in Ukraine and from which taxes and levies were not paid or not in full amount according to legislative requirements on taxation and / or international agreements, the binding nature of which was approved by the Verkhovna Rada of Ukraine and / or which were not declared in violation of tax and currency legislation, the control over which is entrusted to the supervisory authorities during any of the tax periods that occurred before 01.01.2021.
One-time (special) voluntary declaration is ongoing from 01.09.2021 to 01.09.2022 and provides for payment of levy for the one-time (special) voluntary declaration in manner, terms and amounts established by the TCU, as well as other conditions specified in Sub-section 94 Section XX “Transitional Provisions” of the TCU.
Submission of the one-time (special) voluntary declaration (hereinafter – Declaration) is not a separate special procedure for official state’s recognition or confirmation of origin, transfer or termination of rights to assets in respect of which such Declaration is submitted.
One-time (special) voluntary declaration can be used by resident individuals, including self-employed, as well as individuals who are not residents of Ukraine, but who were residents at the time of receipt (acquisition) of declaration objects or at the time of accrual of income from which declaration objects were received (acquired) and which according with the TCU are or were taxpayers (hereinafter – declarant) (Paragraph 3 Sub-section 94 Section XX “Transitional Provisions” TCU).
Paragraph 4 Sub-section 94 Section XX “Transitional provisions” of the TCU stipulates that objects of the one-time (special) voluntary declaration may be assets of an individual owned by the declarant (including joint partial or joint common ownership right) and are (registered, in circulation, registered, etc.) on the territory of Ukraine and / or abroad as of the date of submission of the one-time (special) voluntary declaration (Sub-paragraph 14.1.280 and 14.1.281 Paragraph 14.1 Article 14 of the TCU).
Herewith, Paragraph 5 Sub-section 94 Section XX “Transitional provisions” of the TCU stipulates that declaration objects cannot be:
a)individual’s assets of received (acquired) by the declarant as a result of an act containing signs of a criminal offense, except for criminal offenses or other violations of the law related to:
evasion of taxes, levies (mandatory payments);
payment evasion of the single contribution to obligatory state social insurance and insurance contributions to the obligatory state pension insurance;
violations in the currency legislation;
violations in the protection of economic competition in a part of violation provided for in Paragraph 12 Article 50 of the Law of Ukraine as of 11.01.2001 № 2210-III “On protection of economic competition” with changes and amendments;
b) individual’s assets belonging to the declarant, in respect of which a pre-trial investigation or court proceedings were initiated in respect of such assets on the grounds of criminal offenses under Article 212, 2121, as well as Article 366 (regarding documents of tax and / or financial reporting, customs declarations, tax invoices, primary documents, other reporting on taxes, levies (mandatory payments), Article 367 (if criminal offense is related to violation of tax, customs, currency and other legislation, control over compliance with which is entrusted to regulatory authorities) of the Criminal Code of Ukraine as of 05.04.2001 № 2341-III with changes and amendments (hereinafter – Criminal Code);
Given the above specified, assets received (acquired) at the expense of income subject to taxation (receipt) in Ukraine, from which taxes and levies were not paid or not in full amount in a period up to 01.01.2021 in respect of which a pre-trial investigation was initiated or court proceedings on the grounds of criminal offenses under Article 212, 2121, as well as Article 366 (regarding documents of tax and / or financial reporting, customs declarations, tax invoices, primary documents, other reporting on taxes, levies (mandatory payments), Article 367 (if the criminal offense is related to violation of tax, customs, currency and other legislation, control over compliance with which is entrusted to regulatory authorities) of the Criminal Code are not the basis for accrual of levy for the one-time (special) voluntary declaration.
At the same time, if individual has assets received (acquired) from income subject to taxation at the time of their accrual (receipt) in Ukraine, from which taxes and levies were not paid or not in full amount in a period up to 01.01.2021 and there are any initiated pre-trial investigation or court proceedings against such assets on the grounds of criminal offenses under Article 212, 2121, as well as Article 366 (regarding documents of tax and / or financial reporting, customs declarations, tax invoices, primary documents, other reporting on taxes, levies (mandatory payments), Article 367 (if the criminal offense is related to violation of tax, customs, currency and other legislation, control over compliance with which is entrusted to regulatory authorities) of the Criminal Code, such individual may independently decide to submit the Declaration.
