Commercial Code of Ukraine ceased to be valid on 28.08.2025 according to the Law of Ukraine № 4196-IX as of 09.01.2025 "On the regulation peculiarities of activities of legal entities of certain organizational and legal forms in the transitional period and associations of legal entities" (hereinafter – Law), which defines regulation peculiarities of activities during the three-year transitional period, which began from the date of entry into force of the Law, during which legal entities of certain organizational and legal forms must change their organizational and legal form.
Part 1 Article 108 of the Civil Code of Ukraine stipulates that transformation is a change in the organizational and legal form of the legal entity. In case of transformation, all property, rights and obligations of the previous legal entity are transferred to the new legal entity (Part 2 Article 108 of the Civil Code of Ukraine).
Reorganization of the enterprise through transformation requires payers to comply with rules and regulations specified by the Tax Code of Ukraine regarding the re-registration of a value-added tax payer and determination of rights and obligations of the legal successor.
How does the re-registration of a successor VAT payer take place?
Procedure for registration, re-registration and registration cancellation of the VAT payers is regulated by Articles 183 – 184 of the Tax Code of Ukraine and is regulated by Sections III – V of Regulations on registration of the value added tax payers, approved by Order of the Ministry of Finance of Ukraine № 1130 as of 14.11.2014, registered in the Ministry of Justice of Ukraine on 17.11.2014 under № 1456/26233 with changes (hereinafter – Regulations № 1130).
In case of transformation of the legal entity – taxpayer or changes in data about the taxpayer that relate to the tax number and/or name (surname, first name and patronymic) of the taxpayer and are not related to liquidation or reorganization of the taxpayer, as well as establishment of discrepancies or errors in entries in the register of taxpayers, the taxpayer is re-registered (Clause 2 Paragraph 183.15 Article 183 of the Tax Code of Ukraine).
Re-registration of the taxpayer is carried out in compliance with rules and within time limits specified in Article 183 of the Tax Code of Ukraine for the registration of taxpayers, by making a corresponding entry in register of taxpayers.
Procedure for re-registration procedures is determined by Section IV of Regulation № 1130, according to which, for re-registration, the VAT payer submits to the controlling authority at which the payer is registered, additional registration application Form № 1-VAT, form of which is determined by Annex 1 to Regulation № 1130, with a mark "Re-registration" within 10 working days following the day when the taxpayer’s data changed or other grounds for re-registration arose. Application is submitted by the electronic means in the electronic form in compliance with requirements of the Laws of Ukraine "On electronic documents and electronic document management" and "On electronic trust services".
In case of re-registration of the VAT payer based on Application form № 1-VAT marked as "Re-registration", the registration date by the VAT payer and individual tax number of the VAT payer do not change.
If a person formed through transformation fails to submit application for re-registration within the established period, its registration as the taxpayer will be canceled according to Article 184 of the Tax Code of Ukraine (Clause 6 Paragraph 183.15 of Article 183 of the Tax Code of Ukraine), and the taxpayer has to determine tax liabilities according to Paragraph 184.7 of Article 184 of the Tax Code of Ukraine.
Does the negative value carry forward to the successor’s tax credit?
Paragraph 198.7 Article 198 of the Tax Code of Ukraine stipulates that amount of the negative value, which is subject to inclusion in tax credit of the next reporting (tax) period the payer, that is reorganized by, in particular, transformation, is subject to transfer to the tax credit of legal successor in the next period after signing the transfer deed according to legislation.
Such transfer is carried out if amount of the negative value to be included in the tax credit of the next reporting (tax) period of the reorganized payer is confirmed by a documentary audit by the controlling authority.
Paragraph 13 Section III of Order of the Ministry of Finance of Ukraine № 21 as of 28.01.2026 “On approval of Forms and Procedure for filling out and submitting the value added tax reporting”, registered in the Ministry of Justice of Ukraine on 29.01.2016 under № 159/28289 (with changes), stipulates that if the taxpayer undergoing reorganization has negative amount that is subject to inclusion in the tax credit of the next reporting (tax) period, the specified taxpayer has a right to submit application for the transfer of such negative amount to the tax credit of the successor (Table 2 (D2) (Annex 2)). Such application is submitted as a part of the VAT declaration (hereinafter – declaration) for the last (reporting) period of the taxpayer’s registration.
In case of confirmation by the controlling authority based on the results of documentary audit of the amounts of negative value, legal successor of the reorganized taxpayer has to submit, as a part of declaration for the reporting (tax) periods following such confirmation, application for inclusion of amount of the negative value of the reorganized taxpayer in the tax credit of the reporting (tax) period (Table 3 (D2) (Annex 2)).
Therefore, the negative value is carried forward to the successor’s tax credit if all of the above specified conditions are met.
Algorithm for transferring negative value to the successor’s tax credit:
Peculiarities of filling out Annex 2 by the taxpayers undergoing reorganization and their legal successors are presented on official web portal of the State Tax Service at the link: https://tax.gov.ua/baneryi/onlayn-navchannya/podatok-na-dodanu-vartist/yuridichni-osobi/podatkova-zvitnist/poryadok-skladennya-ta-vnesennya-zmin/903383.html.
Does the successor retain amount of the payer’s ƩInvoice limit?
Requirements of the Tax Code of Ukraine and Procedure for electronic value added tax administration, approved by Resolution of the Cabinet of Ministers of Ukraine № 569 as of 16.10.2014 “Some peculiarities of electronic value added tax administration”, establish that in case of reorganization of the legal entity, amount of ∑Invoices of the successor is included in the calculation of amount of ∑Invoices of the reorganized payer, formed by:
in case of transformation – on the date of state registration of termination of the legal entity being reorganized through transformation.
Submission of Annex 3 (D3) as a part of declaration is not required.
Recalculation of amount of the payer’s ƩInvoice limit, which is reorganized through transformation, and increase of amount of the ƩInvoice limit of the successor payer occurs automatically, provided that they comply with requirements of the Procedure for re-registration of the VAT payer, specified in Paragraph 183.15 Article 183 of the Tax Code of Ukraine and Section IV of Regulations № 1130.