Conduction of economic activity without state registration is a direct violation of requirements of current legislation
State Tax Service of Ukraine reminds taxpayers of the necessity of registration by business entities in case of systematic economic activity of product sale (provision of services).
Economic activity, in sense of the Economic Code of Ukraine, is activity of business entities in public production sphere, aimed at production and sale of products, performance of works or provision of services of a valuable nature, which have a price determination. Economic activity carried out to achieve economic and social results and with aim of making profit is entrepreneurship and subjects of entrepreneurship are entrepreneurs.
Article 42 of the Economic Code of Ukraine stipulates that entrepreneurship as a type of economic activity is independent, initiative, systematic, at one's own risk economic activity carried out by business entities (entrepreneurs) with aim of achieving economic, social results and obtaining profit.
Law includes not only the fact of providing services for a fee, but also systematicity of such actions, their independent and proactive nature, which constitutes essence of economic activity to the general signs of economic activity.
Part 4 of Resolution of Plenum of the Supreme Court of Ukraine № 3as of 25.04.2003 "On practice of courts applying legislation on liability for certain crimes in the economic activity" stipulates that performance by a person not registered as the business entity of any type of economic activity from among those subject to licensing should be understood as activity of person related to production or product sale, performance of works, provision of services for profit, which contains entrepreneurial features, that is, it is carried out by the specified person directly independently, systematically (at least three times during one calendar year) and at own risk.
Territorial bodies of the State Tax Service constantly establish rare cases of economic activity without state registration as the business entity, as example:
Illegal activity of individual who carried out economic activities without state registration and obtaining license for the retail sale of tobacco and alcohol products was terminated in Kyiv region:
https://kyivobl.tax.gov.ua/media-ark/news-ark/716250.html;
Facts of providing hostel services and selling household products without state registration as the business entity were established in Lviv region:
Facts of illegal activity of business entities (without state registration as the business entity) and sale of falsified excisable products were discovered in Poltava region:
https://poltava.tax.gov.ua/media-ark/news-ark/716267.html;
Illegal economic activity without state registration as the business entity was detected in one of the chains of public catering establishments in Odesa region:
In one of the shopping centers of the Dnipro city, during conduction of explanatory company, facts of conduction of economic activities without state registration, sale of tobacco products without presence of excise tax marks, as well as without use of RRO/PRRO were established:
https://dp.tax.gov.ua/media-ark/news-ark/716265.html;
Illegal activity of individual who carried out economic activity and sale of excisable products without registration as individual-entrepreneur was stopped in Kyiv region:
https://kyivobl.tax.gov.ua/media-ark/news-ark/716379.html;
Product sale (unmarked excisable products) by individual without any permits for a right to carry out such trade was discovered in Khmelnytskyi region:
https://km.tax.gov.ua/media-ark/news-ark/716434.html.
Absence of state registration leads to bringing of relevant officials to administrative (Article 164 of the Code of Ukraine on Administrative Offenses) and, in certain cases, to criminal (Article 201 of the Criminal Code of Ukraine) liability.
