Innovations In The Taxation In The Sphere Of Information Technologies In Ukraine

Online, August 21, 2012 (Newswire.com) - Recently changes to the XX section of Transitional provisions of the Tax code of Ukraine came into force. The changes relate to features of the taxation in the sphere of software production.

During the period since January 1, 2013 till January 1, 2023 supply of software transactions (operating systems, games, applied, educational software, cryptographic information protection facilities (electronic key), web sites and / or online services) are exempt from the VAT taxation.

During the period since January 1, 2013 till December 31, 2023 tax rate on the profit received from activity in the IT sphere for subjects of the industry of program production comes to 5 %.

In order to receive the status of the subject of the software products industry the enterprise, occupied in the sphere of the production of software products, should receive the registration certificate of the subject of software products industry. The right to receive this status have the entities that during the 4 consecutive quarters, prior to submitting an application for registration to the tax authorities, meet following requirements:

1. The enterprise income from activity in the sphere of information technologies is not less than 70 % of the income from all kinds of the enterprise activity;

2. The primary cost of fixed assets and/or intangible assets of the enterprise exceeds 50 sizes of minimum salary, established for January 1 of fiscal year (for January 1st 2012 - 1073 UAH.), i.e. for registration in 2013 primary cost of fixed assets and/or intangible assets of the enterprise should exceed 53650, 00 UAH;

3. The enterprise has no tax debts;

4. The enterprise isn't declared bankrupt in a judicial order.

The application for registration by the subject of the industry of program production should be submitted to the tax inspection no later than in 30 calendar days prior to the beginning of the corresponding quarter. Together with the application following documents must be submitted: financial statement, copies of original documents to confirm the compliance with conditions about the 70% of revenues from IT-business.

Within 15 days from the moment of submitting of the application the tax inspection makes the decision whether to issue the registration certificate or to refuse in such issue.

The decision to refuse the registration doesn't prevent the enterprise from submitting an application repeatedly.

It is authorized to apply for registration by companies, created in less than 4 quarters prior to filing the application, but such companies should exist at least 2 quarters before the date of an application. Such enterprises should submit copies of all confirming documents for the entire period of their activity. However this rule isn't applied to the enterprises created after 03.08.2012.

The special tax rate is applied from the first date of the month following after a month in which the certificate was issued.