Is the income tax payer exempted from liability for failure to submit by June 10, 2022 the annual financial reporting, which are subject to publication with the audit report in connection with imposition of the martial law in Ukraine?

Clause 4 of Paragraph 46.2 Article 46 of the Tax Code of Ukraine № 2755-VI as of 02.12.2010 with changes and amendments (hereinafter – TCU) stipulates that income tax payers who, according to the Law of Ukraine № 996-XIV as of 16.07.1999 "On accounting and financial reporting in Ukraine" with changes and amendments are required to publish annual financial reporting and annual consolidated financial reporting with the auditor report, submit annual financial reporting to the supervisory authority, which is subject to publication with the audit report not later than June 10 of the year following the reporting year. In case of non-submission (late submission) of the annual financial reporting, which are subject to publication with the audit report, the liability is provided for in Paragraph 120.1 Article 120 of the TCU, for filing tax declarations (calculations).

Temporarily, for a period until termination or abolition of the martial law in Ukraine, introduced by Decree of the President of Ukraine "On imposition of the martial law in Ukraine" № 64/2022 as of 24.02.2022, approved by the Law of Ukraine "On approval of Decree of the President of Ukraine "On the martial law in Ukraine" № 2102-IX as of 24.02.2022, collection of taxes and levies is subject to features specified in Paragraph 69 Sub-section 10 Section XX "Transitional Provisions" of the TCU.

Clauses 1 – 2 of Sub-paragraph 69.1 Paragraph 69 Sub-section 10 Section XX "Transitional Provisions" of the TCU stipulate that in case the taxpayer does not have opportunity to timely fulfill tax obligation to meet deadlines, in particular, submission of reporting provided for in Paragraph 46.2 Article 46 of the TCU, the taxpayers are released from liability provided by the TCU with mandatory performance of such obligations within six months after termination or abolition of the martial law in Ukraine.

If the taxpayer is unable to perform tax obligation to meet its deadlines, representative office, separate or other structural unit in a timely manner, in particular, the submission of reporting provided for in Paragraph 46.2 Article 46 of the TCU, such taxpayer is released from liability under the TCU, within the activities carried out through such branches, representative offices, separate or other structural units for a period before termination or abolition of martial law in Ukraine.

Taxpayers, including in respect of their branch, representative office, separate or other structural unit, whose ability to perform their tax duties has been restored, the deadline for which falls on a period from 24.02.2022 to the date of the taxpayer’s resumption of performing obligations, are released from liability for late fulfillment of such obligations under the TCU, subject to the fulfillment of such tax obligations, in particular, for reporting within 60 calendar days from the first day of a month following the month of restoration of such opportunities for taxpayers (Clause 4 of Sub-paragraph Paragraph 69.1 Article 69 Sub-section 10 Section XX “Transitional Provisions” of the TCU).

As follows, the income tax payer, if he / she is unable to submit annual financial reporting to be published with the audit report by June 10, 2022 is released from liability for failure to submit if he / she fulfills obligation within six months after termination or abolition of the martial law in Ukraine.

In case of resumption of ability to perform tax obligation to submit annual financial reporting, which are subject to publication with the audit report, the taxpayer is released from liability for late performance of such obligation, subject to submission of annual financial reporting with the audit report within 60 calendar days from the first day of a month following the month of renewal of this possibility.

In this case, confirmation of the possibility or impossibility of the taxpayer's obligations will be carried out according to a separate Procedure, which will be approved by the Ministry of Finance of Ukraine.

More information is in the “Knowledge Base” of public information and reference resource