Report on Controlled Transactions in Ukraine

Controlled transactions (report) are an important component of the economic activity of Ukrainian enterprises that conduct business with non-residents. The submission of a report on such transactions is mandatory for the respective taxpayers. Let us consider the main aspects of the preparation and submission of this report.

Report Form

The report on controlled transactions is submitted exclusively in electronic form. The form of the report is approved by the order of the Ministry of Finance of Ukraine No. 8. Taxpayers must use electronic communication means for submitting the report, adhering to the requirements of the Law on Electronic Document Management and Electronic Digital Signature. The electronic form of the report provides convenience in submission and processing of data, as well as minimizes the risk of errors associated with paper documentation.

Who Must Submit the Report

The report on controlled transactions must be submitted by taxpayers selected according to the following criteria:

• The annual income from all types of activities of the taxpayer exceeds 150 million UAH.
• The volume of business operations with one non-resident counterparty exceeds 10 million UAH.

Controlled transactions include the sale or purchase of goods and services, payment of interest on loans, payment of royalties, and other transactions conducted with non-resident counterparties. It is important to note that counterparties may be either related parties or non-residents from certain jurisdictions, the list of which is defined in Article 39 of the Tax Code of Ukraine.

Procedure for Preparing the Report

The preparation of the report on controlled transactions is based on data from primary documents, such as contracts, invoices, acts of completed work, and other documents that confirm the implementation of controlled transactions. The report must contain detailed information about all controlled transactions conducted by the company during the reporting period. For each transaction, it is necessary to indicate the transaction code according to Appendix 3 of the Order for Preparing the Report.

When preparing the report, it is necessary to adhere to the requirements for the content and structure of the document. This includes specifying the identification data of the counterparty, a description of the transaction, its cost indicators, and other necessary information. An important part of the report is also the indication of the transfer pricing methods used to determine the compliance of the terms of controlled transactions with the 'arm's length' principle.

Submission Deadlines for the Report

The report on controlled transactions is submitted to the tax authorities annually by October 1 of the year following the reporting year. That is, the report for 2023 must be submitted by October 1, 2024. Failure to meet the submission deadlines may result in penalties, so it is important to prepare the necessary documentation in advance and submit the report on time.

Compliance with the rules for preparing and submitting the report on controlled transactions contributes to enhancing tax discipline and ensuring effective control over the activities of enterprises that carry out economic operations with non-residents.

Additional information about controlled transactions (report) https://krivoyrog.biz/zvit-pro-kontrolovani-operacii