CHANGES IN THE LEGISLATION OF UKRAINE IN CONNECTION WITH THE IMPLEMENTATION OF MARTIAL LAW

On January 24, 2022, martial law was imposed in Ukraine for a period of 30 days.

Changes in the registration of legal entities, entrepreneurs and public associations.

RLA: Resolution of the Cabinet of Ministers of Ukraine “Some issues of state registration in martial law and amendments to the resolution of the Cabinet of Ministers of Ukraine of February 28, 2022 № 164” of March 6, 2022 № 209.

It is established that registration actions are carried out taking into account the following features:

1) State registration is carried out exclusively by state registrars, who under martial law are granted access to the State Register of Real Property Rights and / or the Unified State Register of Legal Entities, Individuals – Entrepreneurs and Public Associations (hereinafter – the registers).

2) Officials have the right to carry out registration actions for individual entrepreneurs, all types of legal entities and public formations, as well as to make decisions on state registration of real rights to real estate property and their encumbrances.

3) State registration of legal entities, individual entrepreneurs and public entities may be carried out on the basis of documents sent by the applicant to the state registrar by e-mail or by other means of communication in electronic form. document circulation, created in compliance with the legislation in the field of electronic trust services and the legislation on electronic documents and electronic document management, or electronic copies of documents in paper form. Electronic copies of documents in paper form are accepted subject to the signing of such copies using a qualified electronic signature of the applicant.

4) State registration is carried out immediately upon recieving of the appropriate documents for state registration in full.

5) State registration is carried out regardless of the location of real estate, the location of legal entities, individual entrepreneurs or public associations.

6) The administrative fee is not charged for the state registration of charitable organizations, public associations, the subject of which is to provide assistance to the Armed Forces, other military formations, law enforcement (special), civil protection, etc.

7) Payment of the administrative fee may be confirmed by an electronic copy (including a screen copy) of the relevant payment document.

8) The requirements of the legislation on the need for notarization of the signature on the document for state registration do not apply if such a signature is made in the presence of the state registrar, official with the identification of the signatory on the basis of identity document.

9) The requirements of the legislation on the mandatory use for state registration of information registers, automated information systems, the holder (administrator, owner, administrator) of which are public authorities, does not apply in case of temporary lack of access to such registers (systems).

10) Documents for state registration of the creation of public formations, except for public associations, are not accepted, and review of previously submitted documents is suspended for the duration of martial law.

Changes in the banking system.

RLA: Resolution of the NBU Board № 18 of 24.02.2022 and Resolution of the NBU Board № 44 of 08.03.2022 (on amendments to the Resolution № 18)
Banks continue to operate subject to the following restrictions:

1) It is prohibited to issue cash from the client’s account in hryvnias in the amount exceeding 100,000 hryvnias per day (issuance is carried out without accrual and withdrawal of commissions), except for cash withdrawals in hryvnias:
– for the purpose of payment of wages and social benefits;
– from the accounts of enterprises and institutions that ensure the implementation of mobilization plans (tasks), the Government of Ukraine;
– in branches, bank branches located in territories under threat of occupation by the aggressor / occupying state (issuance is carried out within the balance of funds on the account if there is cash in the cash desk of the branch).

2) Non-cash payments are made without restrictions.

3) It is prohibited to issue cash from the client’s account in foreign currency in excess of 30,000 hryvnias per day (issuance is carried out without accrual and withdrawal of commissions), except for withdrawal of cash in foreign currency from the accounts of:
– enterprises and institutions that ensure the implementation of mobilization plans (tasks), the Government of Ukraine;
– in branches, outlets of banks located in territories under threat of occupation by the aggressor / occupying state;
Disbursement of bank metals from the accounts of bank customers is carried out without restrictions within the balance of bank metals on the account in the presence of bank metals at the cash desk of the bank’s branch. ”

4) Payments of the Government are made without restrictions in accordance with the legislation on the special period.

5) Banks ensure the operation of branches in an uninterrupted mode in the absence of threat to life and health.

6) Access to storage facilities for individual safes and / or safes with individual customer safes is provided without interruption, if there is no direct threat to life and health of the population.

7) Authorized institutions are prohibited from trading in currency values (including transactions on behalf of clients), except in the following cases:
– sales of foreign currency by customers in cash / non-cash form to banks, as well as in cash form to non-banking financial institutions and postal operators;
– purchases by customers of foreign currency in cash, bank metals with physical delivery in branches, bank branches located in territories under threat of occupation by the aggressor / occupying state, etc.

11) Authorized institutions are prohibited from making cross-border transfers of currency values from Ukraine on behalf of clients, except in cases of:
– banks’ own operations, including settlements with international payment systems;
– import operations of residents for the purchase of critical import goods according to the list approved by the Cabinet of Ministers of Ukraine;
– foreign exchange transactions by residents and non-residents to carry out mobilization and other measures (needs) determined by the laws of Ukraine governing relations in the areas of national security and defense;
– operations on payment of expenses for treatment in medical institutions of a foreign state, payment of expenses for transportation of patients, payment of expenses related to the death of citizens abroad (transportation expenses and funeral expenses);
– on the basis of separate permits (decisions) of the National Bank of Ukraine, adopted on the basis of appeals of the Cabinet of Ministers of Ukraine, ministries and other state bodies of Ukraine;
– transfers in favor of diplomatic missions, consular posts of Ukraine abroad;
– settlements abroad using electronic means of payment or the use of electronic means of payment to obtain cash.

12) Individuals – residents carry out foreign exchange transactions for cross-border movement of foreign exchange values without taking into account the requirements of paragraph 18 of section I of Regulation No. 5 in terms of submission of supporting documents.

13) To suspend expenditure operations by servicing banks on the accounts of residents of the Russian Federation / Republic of Belarus, on the accounts of legal entities (except banks), the ultimate beneficial owners of which are residents of the Russian Federation / Republic of Belarus, except for the implementation on the territory of Ukraine:
– transfer of funds from such accounts to a special account of the National Bank of Ukraine to raise funds in support of the Armed Forces of Ukraine and / or to 3 accounts of the Cabinet of Ministers of Ukraine, ministries and other state bodies of Ukraine;
– social benefits, wages, utilities, taxes, fees and other mandatory payments.

14) Forbid:
– crediting funds to the accounts of individuals’ clients on transfers initiated with the use of electronic means of payment issued by participants of international payment systems operating in the territory of the Russian Federation and the Republic of Belarus;
– acceptance in Ukraine of electronic means of payment (including transfers, settlements and cash withdrawals) issued by participants of international payment systems operating in the Russian Federation and the Republic of Belarus.

15) Suspend e-money issuing banks, replenishing e-wallets with e-money, and distributing e-money.

16) Authorized institutions are prohibited from carrying out any foreign exchange transactions:
– using russian rubles and belarusian rubles;
– the participant of which is a legal entity or person who is located (registered / permanently resident) in the Russian Federation or in the Republic of Belarus;
– to fulfill obligations to legal entities or people who are located (registered / permanently resident) in the Russian Federation or in the Republic of Belarus.

17) To recommend to banks, first of all, to collect business entities in the field of retail trade in compliance with the following conditions:
– providing support for collection brigades by the protection of law enforcement agencies with the use of firearms, including territorial defense forces;
– subject to unconditional acceptance by this business entity for payment of electronic means of payment at all points of sale.

Changes in taxation and tax benefits.

RLA: Law “On protection of interests of subjects of reporting and other documents during martial law or state of war”, Law “On amendments to the Tax Code of Ukraine and other legislative acts of Ukraine on peculiarities of taxation and reporting during martial law”.

1) Individuals, entrepreneurs, legal entities submit accounting, financial, settlement, audit reports and any other documents required to be submitted in accordance with applicable law in documentary and / or electronic form, within three months after termination or the abolition of martial law or state of war for the entire period of non-reporting or obligation to submit documents.

2) During the period of martial law or state of war, as well as within three months after its completion, individuals, entrepreneurs, legal entities are not subject to administrative and / or criminal liability for failure to submit or late submission of reports and / or documents specified in subparagraph 1. of this paragraph.

3) People who do not have the physical ability within the period specified by law to submit reports or documents referred to in paragraph 1 above, in connection with the direct consequences of their participation in warfare, are released from administrative and / or criminal liability and submit reports or documents within one month from the date of completion of the consequences that made it impossible to submit them.

4) During the period of martial law or state of war, any verification of the timeliness and completeness of the submission of any reports or documents of a reporting nature by the authorized bodies shall not be carried out.

5) In case the taxpayer does not have the opportunity to fulfill his tax obligation in time, in particular, to meet the deadlines for payment of taxes and fees, submission of reports, etc., registration in the relevant registers of tax or excise invoices, adjustment calculations, submission of electronic documents containing actual data residues of fuel and the volume of circulation of fuel or ethyl alcohol, etc., taxpayers are released from liability under this Code with mandatory performance of such duties within three months after the termination or abolition of martial law in Ukraine.

6) Tax audits do not start, and ongoing audits are stopped.

7) Taxpayers who, due to the consequences of their direct participation in warfare, have not complied with the deadlines for the performance of tax duties, shall be released from liability for non-performance of tax obligations, provided that such obligations are performed within one month from the elimination of the consequences. , which made it impossible to perform such duties.

8) If it is impossible to register the excise invoice in the Unified Register of Excise Invoices, it is allowed to move fuel or ethyl alcohol by vehicles if there is a consignment note, which must contain all the information contained in the relevant excise invoice, which must be registered in the Unified Register of Excise specified deadlines.

9) Operations on voluntary transfer or alienation of funds, goods, including excisable, services for the benefit of the Armed Forces of Ukraine and territorial defense units, without prior or subsequent reimbursement of their value, are not considered sales operations for tax purposes.

10) Adjustments established by sub-clause 140.5.9 of clause 140.5 of Article 140 of the Tax Code of Ukraine shall not be made on the amount of funds or the cost of special personal protective equipment (helmets, bulletproof vests manufactured in accordance with military standards), technical means of surveillance, medicines and medical devices, hygiene products, food, supplies, as well as other goods, work performed, services provided according to the list determined by the Cabinet of Ministers of Ukraine, which are voluntarily listed (transferred) to the Armed Forces of Ukraine, National Guard of Ukraine, Security Service of Ukraine, Foreign Intelligence Service of Ukraine , The State Border Guard Service of Ukraine, the Ministry of Internal Affairs of Ukraine, the Department of State Protection of Ukraine, the State Service for Special Communications and Information Protection of Ukraine, other military formations, their units, military units, subdivisions, institutions or organizations maintained at the expense of the state budget for the needs of state defense in connection with the military aggression of the Russian Federation against Ukraine.

11) The amount of reimbursement of the cost of fuel spent on the provision of transportation services to meet the needs of the Armed Forces of Ukraine and territorial defense units is not included in the taxable income of individuals who provide such services.

12) For the period before the termination or abolition of martial law the production and import of tobacco products classified under code 2402 20 90 20 in accordance with UKT FEA marked excise tax stamps “tobacco products for electric heating (ТВЕН) with a heater with electronic control domestic” – ” ТВЕН B “,” Tobacco-containing products for electric heating (ТВЕН) with the help of electronically controlled heaters imported “-” ТВЕН I “, if the rate of excise tax is the same is allowed.
The circulation of tobacco products marked in accordance with this sub-item shall be carried out until their full sale to the final consumer.

13) For taxpayers and controlling bodies, the time limits set by the tax legislation and other legislation, the control over the observance of which is entrusted to the controlling bodies, shall be suspended.

14) Licenses are valid under which the next payment for the license has not been paid before the termination or abolition of martial law on the territory of Ukraine and / or the validity of the license has expired:
– production and circulation of alcohol, alcoholic beverages, tobacco products and liquids used in electronic cigarettes;
– production, storage, wholesale and retail of fuel, and places of production, storage, wholesale and retail of fuel.
Obligations to pay the next payments / actions to renew the license must be performed by the business entity within 30 days following the day of termination or abolition of martial law in Ukraine.

15) Temporarily, for the period until the termination or abolition of martial law on the territory of Ukraine, sanctions are not applied for violating the requirements of the Law “On the use of registrars of settlement transactions in the field of trade, catering and services.”

Value added tax.

The State Tax Service of Ukraine informs (https://tax.gov.ua/media-tsentr/novini/576303.html).

Taxpayers in order to ensure the declaration of value added tax liabilities payable to the budget for the reporting period February 2022 in the value added tax reporting for such period declare tax liabilities and tax credit subject to the following features:
1) Tax liabilities and tax credit, which as of February 24 are confirmed by tax invoices registered in the Unified Register of Tax Invoices (hereinafter – URTI) and calculations of adjustments to them are reflected in the relevant sections of tax reporting in the general order.

2) Tax liabilities and tax credit, which as of February 24 and until the end of martial law throughout Ukraine are not confirmed by registered in the URTI tax invoices and calculations of adjustments to them, are reflected in the tax reporting on value added tax on the basis of available to the payer primary (settlement) documents (registrars of settlement operations documents, acts of acceptance – transfer, acts of performed works / rendered services, etc.), drawn up (received) by the taxpayer for transactions on supply and purchase of goods / services in accordance with the Law of Ukraine “On Accounting and Financial Reporting” in Ukraine”.

3) After the end of martial law, taxpayers are obliged to ensure registration in the URTI of all tax invoices and adjustment calculations, the registration of which is postponed during martial law, and all tax liabilities and tax credits declared by taxpayers during such martial law on the basis of available at the payer of primary (settlement) documents, are subject to obligatory specification (adjustment) taking into account the data of tax invoices and calculations of adjustment registered in URTI.

4) The form of tax invoice / adjustment calculation, taking into account the changes made by the order of the Ministry of Finance of Ukraine from 17.01.2022 № 15, will be available to taxpayers after martial law, about which taxpayers will be further informed.