Registration as a VAT-payer

Registration as a VAT-payer (VAT is “value added tax”) is done under the rules of the Tax Code of Ukraine and peculiar Regulations of the State Fiscal Service of Ukraine.

Legal entities and individual entrepreneurs are considered VAT-payers if:

1)      They are voluntarily registered

2)      are subject to mandatory registration;

3)      have a certain amount of imported goods;

4)      Conduct joint activities without establishment of legal entity, etc.

We are interested in the first two categories.

Voluntary and compulsory VAT-payer registration

Is possible only under two conditions:

1) if the person is not subject to mandatory registration, and the amount of goods / services provided to other VAT-payers within the last 12 calendar months is totally not less than 50% of the total supply.

2) if the cost of the share capital or the carrying amount of assets (fixed assets, intangible assets, stocks) is more than UAH 300 000.

The registration is free. The applicant has to submit the application to the State Fiscal Service 20 days before the tax period when he is going to pay the VAT. For example, if you apply on the 10th of August, you’ll become a VAT-payer from the 1st of September. But if you are late and submit the application on the 15th of August, you’ll be registered a VAT-payer only from the 1st of October.

The requirements concerning the application for VAT are very strict and every mistake is a ground for refusal of registration.

If the company or individual entrepreneur during one year sold goods and services for more than UAH 300 000 (Excluding VAT), it has a duty to register as a VAT -payer in the local subdivision of the State Fiscal Service. The application is to be submitted not later than the 10th day of the month, that follows the month when the sum of UAH 300 000 was reached.

A person who breaks this rule and does not register itself as a VAT-payer bears legal responsibility for the incorrect tax paying. Thus, do not be negligent, control your bookkeeping and consult professional lawyers in order to save your money and business.