Ukrainian VAT Return for Suppliers of Electronic Services

From 2022 onwards foreign companies supplying the so-called “electronic (digital) services” to customers in Ukraine may have to register with Ukrainian tax authorities and collect VAT. We have already shed some light on this topic in our previous article, which might help understand whether new Ukrainian VAT on electronic services affects your business. In this article we decided to highlight key details about Ukrainian VAT Return.

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Recently, Ukrainian state bodies adopted by-laws to ensure that foreign suppliers of electronic services are able to perform their VAT obligations in Ukraine in a proper way. The Ministry of Finance of Ukraine issued Order No. 555 as of 21 October 2021 enacting a form of VAT return for suppliers of foreign electronic services (the “E-services VAT Return“).

Contents of the E-services VAT Return

The E-services VAT Return is a simplified version of a general Ukrainian VAT return. It is bilingual (Ukrainian and English translations are present) and contains the following fields:

1. foreign company’s name and TIN (Ukrainian tax authorities assign a TIN to each foreign company upon completion of its registration as a VAT payer);
2. reporting quarter;
3. currency (only USD or EUR are currently available) in which foreign company prefers to remit its outstanding VAT;
4. value of electronic services supplied to customers in Ukraine during a reporting quarter;
5. foreign company’s VAT liabilities arising from such supply of electronic services;
6. other immaterial fields.
   

Filing Procedure

A foreign supplier of electronic services can choose a preferred language (English or Ukrainian) of his Ukrainian VAT Return (the E-services VAT Return). The return itself should be filed through an e-portal on a quarterly basis.

Tax Audit

The E-services VAT Return can be subject only to a special desk audit. During such audit Ukrainian tax authorities can request to submit additional information. In this regard, communication between such supplier and Ukrainian tax authorities should be exercised through the special e-portal.

How can we assist you?

We can:

• assess whether your services are subject to Ukrainian VAT on electronic services;
• develop a step-by-step guidance on how to comply with Ukrainian VAT requirements;
• other services related to VAT compliance in Ukraine.