According to Paragraph 298.1 Article 298 of the Tax Code of Ukraine (hereinafter – the TCU) the procedure for election or switching to the simplified taxation system by single tax payers of Group I – III is carried out in accordance with Sub-paragraph 298.1.1 – 298.1.4 of Paragraph 298.1 Article 298 of the TCU.
To choose or switch to the simplified taxation system, the business entity must submit to supervisory authority at the place of tax address an application for the transition to simplified taxation system (hereinafter – the application) (First paragraph of Sub-paragraph 298.1.1 Paragraph 298.1 Article 298 of the TCU).
Application form was approved Order of the Ministry of Finance of Ukraine as of 16.07.2019 № 308.
According to Sub-paragraph 298.1.4 Paragraph 298.1 Article 298 of the TCU, the business entity that is a payer of other taxes and fees in accordance with the TCU, may decide to switch to the simplified taxation system by submitting an application to the supervisory authority not later than 15 calendar days before the beginning of the next calendar quarter. Such business entity can make a transition to the simplified taxation system once a calendar year.
According to Sub-paragraph 298.1.5 Paragraph298.1 Article 298 of the TCU, given that the single tax payer complies with requirements established by the TCU for selected Group, such taxpayer may independently switch to payment of the single tax established for other Groups of single tax payers by submitting an application to supervisory authority not later than 15 calendar days before the beginning of next quarter. At the same time, the taxpayer of Group III who is a value added tax payer, shall have his / her registration of the value added tax payer canceled in accordance with the procedure established by the TCU, if he / she chooses Group I or II or the single tax rate set for Group III, which includes value added to the single tax.
Herewith, the single tax payers of Group I who in a calendar quarter exceeded amount of income specified for such taxpayers in Paragraph 291.4 Article 291 of the TCU, from the next calendar quarter by an application they switch to the single tax rate determined for single tax payers of Group II or III or refuse to apply the simplified taxation system.
Application is submitted not later than the 20th day of month following the calendar quarter when the excess of income is allowed (Sub-paragraph 293.8.1 Paragraph 293.8 Article 293).
Single tax payers of Group II who exceeded in tax (reporting) period the amount of income specified for such taxpayers in Paragraph 291.4 Article 291 of the TCU, in the next tax (reporting) quarter by an application switch to application of the single tax rate determined for single taxpayers of Group III or refuse to apply the simplified taxation system.
Application is submitted not later than the 20th day of month following the calendar quarter when the excess of income is allowed (Sub-paragraph 293.8.2 Paragraph 293.8 Article 293).
Single tax payers of Group III (individuals - entrepreneurs) who exceeded in tax (reporting) period the amount of income specified for such taxpayers in Paragraph 291.4 Article 291 of the TCU to the amount of excess must apply the 15% single tax rate and are obliged in the manner prescribed by this chapter to switch to the payment of other taxes and fees established by the TCU(Sub-paragraph 293.8.3 Paragraph 293.8 Article 293).
According to Sub-paragraph 293.8.04Paragraph 293.8 Article 293 the 3% single tax rate set for Group III can be chosen by:
a) the business entity registered as a value added taxpayer in accordance with Section V of the TCU, in case of transition to the simplified taxation system by submitting an application for transition to the simplified taxation system not later than 15 calendar days before the beginning of next calendar quarter;
b) single tax payers of Group III who chose the 5% single tax rate in case of voluntary change of the single tax rate by submitting an application for change of the single tax rate not later than 10 calendar days before the beginning of calendar quarter when the new rate will be applied and registration of such single tax payer as a value added tax payer in accordance with section V of the Code;
c) the business entity who is not registered as a value added tax payer in case of transition to the simplified taxation system or change of the single tax payers Group by registration as a value added tax payer in accordance with Section V of the TCU and submission of an application for transition to the simplified taxation system or change of the single tax payers Group not later than 15 calendar days before the beginning of next calendar quarter when the value added taxpayer is registered;
In case of cancellation of registration of the value added tax payer in order established by Section V of the TCU, the single tax payers are obliged to pass to payment of the single tax at the 5% rate (for the single tax payers of Group III) or refuse to apply the simplified taxation system by submitting an application to change the single tax rate or refuse to apply the simplified taxation system not later than 15 calendar days before the beginning of next calendar quarter when registration of the value added taxpayer is canceled. In order to refuse from application of the simplified taxation system, the business entity must submit an application to the supervisory authority not later than until 10 calendar days before the beginning of new calendar quarter (year) (Sub-paragraph 298.2.5 Paragraph 298.2 Article 298 of the TCU).
In order to refuse from application of the simplified taxation system, the business entity must submit an application to the supervisory authority not later than until 10 calendar days before the beginning of new calendar quarter (year) (Sub-paragraph 298.2.1 Paragraph 298.2 Article 298 of the TCU).