We pay attention to compliance with conditions of stay on the simplified taxation system!
Main requirements for the possibility of election and transition by legal entities and individuals-entrepreneurs to pay single tax are established in Article 298 of the Tax Code of Ukraine (hereinafter – Code). To choose or make a transition to the simplified taxation system, business entity submits application to the controlling body at the tax address.
All mandatory information must be specified in the application, in particular types of economic activity chosen by the business entity according to Classification of economic activity types of the State classifier 009:2010.
If the application is submitted without specifying any of mandatory information, the payer has opportunity to submit it again, filling in all mandatory information.
Please that Code prohibits certain types of activities that do not give taxpayers right to be on the simplified taxation system. Corresponding prohibited types of activities are defined in Sub-paragraph 291.5.1 of Paragraph 291.5 Article 291 of the Code.
Methodological bases and explanations for positions of the national classifier of the State classifier 009:2010 "Classification of economic activity types" were approved by Order of the State Statistics Committee of Ukraine № 396 as of 12.23.2011 (hereinafter – Order № 396).
Taking into account explanations given in Order № 396, basis for decision of the controlling body to refuse registration of the single tax payer is presence and implementation by the business entity of the following activity codes (according to Classification of economic activity types of the State classifier 009:2010):
05.10, 05.20, 06.10, 06.20, 07.10, 07.21, 07.29, 08.11 (in the extraction of decorative and building stone and clay slate), 08.12 (in the extraction of gravel, clay and kaolin), 08.91, 08.92, 08.93, 08.99, 11.01, 11.02, 11.03, 11.04, 11.05, 12.00, 19.20, 24.41, 29.10, 29.20, 32.12 (in the production of processed precious and semi-precious stones), 35.11, 35.14, 35.21, 35.23, 45.11, 45.19 (in terms of the whole and retail sale of new motor vehicles and trucks, trailers and semi-trailers), 46.12, 46.17 (in terms of activities of intermediaries in sale of tobacco products), 46.21 (in part of wholesale of raw tobacco), 46.34 (in part of sale of alcoholic beverages), 46.35, 46.39 (in part of non-specialized wholesale of alcoholic beverages and tobacco products), 46.71, 46.72, 46.76 (in part of wholesale of precious stones), 47.11 (in part of retail sale of non-specialized stores of alcoholic beverages and tobacco products), 47.25 (in part of retail sale of alcoholic beverages), 47.26 (in part of retail sale of tobacco products), 47.30, 47.79 (regarding retail sale of antiques and activity of auction houses), 47.81 (in part of retail sale of alcoholic beverages and tobacco products from trays and in markets), 47.91 (in part of activity of retail sale of art works through Internet auctions, collectibles or antiques), 53.10, 53.20 (in part of postal activities), 61.10, 61.20, 61.30, 64.11, 64.19, 64.20, 64.30, 64.91, 64.92, 64.99, 65.11, 65.12, 65.20, 65.30, 66.11, 66.12 66.19, 66.22 (in part of activity of insurance brokers), 66.29, 66.30, 90.01, 90.02, 90.04, 92.00, 93.21 (in terms of organizing and holding tour events).
At the same time, please note that the single tax payers are obliged to switch to payment of other taxes and levies specified by the Code, in case of activities that do not give a right to be on the simplified taxation system – from the first day of a month following tax (reporting) period in which such activities were carried out.
Also, registration of the single tax payer can be canceled by exclusion from Register of single tax payers by decision of the controlling body.
Herewith, exclusion of the single tax payer from Register of single tax payers occurs in case that such business entity carries out prohibited types of economic activity.
Therefore, the business entity has a right to register activities (according to Classification of economic activity types of the State classifier 009:2010), which contain at the same time a partial ban on certain type of activity, while such payers must comply with requirements specified in Sub-paragraph 291.5.1 Paragraph 291.5 Article 291 of the Code.
As follows, if the taxpayer has registered activity codes that contain both permitted and prohibited types of activity, but the taxpayer does not actually perform prohibited types of activity, such legal entity or individual may be registered as the single tax payer and be on the simplified taxation system.
It should be noted that according to Paragraph 36.5 Article 35 of the Code, the taxpayer is responsible for non-fulfilment or improper fulfillment of tax obligation.
In case of non-compliance with requirements established by the Code:
to income of legal entity, received from activities that do not give a right be on the simplified taxation system, amount of the single tax rate is established in a double amount (Paragraph 293.5 Article 293 of the Code);
single tax of 15 percent rate is imposed to income of individual-entrepreneur, received from performance of activities that do not give a right to be on the simplified taxation system (Paragraph 293.4 Article 293 of the Code).