Law of Ukraine № 4143-IХ as of 17.12.2024 “On amendments to the Tax Code of Ukraine and other Laws of Ukraine regarding exemption from value added tax on the import of certain defense-use products to the customs territory of Ukraine” (hereinafter – № 4143), which entered into force on 30.12.2024, amended conditions for inclusion in the Register of non-profit institutions and organizations of charitable organizations that pay compensation and make other payments to employees of such organizations, and also added list of possible recipients of charitable assistance from the non-profit organizations.
Non-profit enterprises, institutions and organizations are not payers of corporate income tax according to procedure and under conditions specified in Paragraph 133.4 Article 133 of the Tax Code of Ukraine (hereinafter – Code).
At the same time, for a period of legal regime of martial law or state of emergency in territory of Ukraine, the transfer of property, provision of services, charitable assistance, use of income by relevant non-profit organization to finance expenses not related to implementation of goals and areas of activity stipulated by its constituent documents, for purposes and for benefit of recipients, as established by Paragraph 63 Sub-section 4 Section XX of the Code, shall not be considered a violation of requirements of Paragraph 133.4 Article 133 of the Code regarding presence of the non-profit organization in Register of non-profit institutions and organizations.
Amendments to the Code introduced by the Law № 4143 provide that payment of compensations and other payments (including those that are additional benefits) to employees of a charitable organization is not a basis for excluding such charitable organization from Register of non-profit institutions and organizations, provided that such compensations and other payments are related to implementation of goals and objectives of such charitable organization and are provided for by its constituent documents and/or organizational and administrative documents and do not contradict the Law of Ukraine “On charitable activities and charitable organizations”. Amount of such compensations and other payments in tax (reporting) year should not exceed 25 percent of the amount of administrative expenses incurred by such charitable organization for the tax (reporting) year.
In addition, taking into account amendments made by the Law № 4143 to Paragraph 63 Sub-section 4, Section XX of the Code, for a period of legal regime of martial law or state of emergency in territory of Ukraine, the list of persons to whom provision of charitable assistance by the non-profit organization will not lead to its loss of such status has been expanded. Expansion of the specified list concerns participants – recipients of charitable assistance from non-profit organizations from among:
participants in hostilities, servicemen (reservists, conscripts) and employees of the Armed Forces of Ukraine, National Guard of Ukraine, the Security Service of Ukraine, Foreign Intelligence Service of Ukraine, State Border Service of Ukraine, the Ministry of Internal Affairs of Ukraine, State Guard Department of Ukraine, State Service for Special Communications and Information Protection of Ukraine, other military formations formed according to the laws of Ukraine, volunteer formations of territorial communities, police officers and employees of the National Police of Ukraine, including those who suffered injuries, contusions or other damage to health, who protect (protected) independence, sovereignty and territorial integrity of Ukraine, take (took) direct part in repelling armed aggression and ensuring national security, eliminating the threat of danger to the state independence of Ukraine, its territorial integrity during the martial law, state of emergency in Ukraine, being directly in areas of implementation of the specified measures, or for benefit of their family members (within the meaning of subparagraph 165.1.54 of paragraph 165.1 of Article 165 of the Code) of military personnel who died, died as a result of injury, contusion or mutilation;
employees of enterprises, institutions, organizations, civil defense forces who are involved (were involved) and take (took) direct participation in implementation of measures to ensure national security and defense, repel and deter armed aggression of russian federation, being directly in areas of hostilities and during period of hostilities, in manner established by the law, or for the benefit of their family members (within the meaning of Sub-paragraph 165.1.54 Paragraph 165.1 Article 165 of the Code).