Legal Talk: Resumption of Tax Audits and Abolition of the 2% Flat Tax

29 September 2023 y.

On September 28th, Legal Talk discussed the prospects of resuming tax audits and the possibility of abolishing the 2% flat tax for Ukraine's IT sector, which directly impacts the financial condition of companies and the competitiveness of the industry. The event's speaker was Vitaliy Smerdov, a partner in the tax practice at Crowe Mikhailenko, who has extensive experience in tax consulting and taxation. Legal Talk is organized by Kharkiv IT Cluster with the support of the USAID program "Competitive Economy of Ukraine." During the event, Vitaliy Smerdov highlighted several crucial aspects related to tax audits and taxation in the IT industry. The main discussion points included:

Tax Audits:

• Review of planned tax service audits and their taxpayer categories.
• Emphasis on the possibility of unscheduled audits for IT businesses and the potential reasons for them.
• Control over foreign companies in Ukraine, primarily focusing on individuals rather than legal entities.

Cancellation of Tax Credits and Penalties:

• The possibility of canceling tax credits for buyers in case of discrepancies in tax invoices or transactions.
• Penalties for failure to register tax invoices correctly.

Details of Acts and the Risk of Expenditure Loss:

• The importance of detailing acts, especially when working with individual contractors and gig contracts.
• The risk of losing expenditures when an operation is deemed unreal.

Speaker's Advice:

• Advice on the taxation of compensations, bonuses, and paid breaks in the context of gig contracts and other agreements in the IT industry.
• Recommendations regarding the identification and taxation of different types of compensations and bonuses.
• Attention to changes in legislation and the necessity of contract adaptation.

At the end of the event, the speaker addressed current tax issues and discussed the possibility of abolishing the 2% flat tax. Vitaliy Smerdov's presentation aimed to increase tax awareness and provide specific advice for effective tax planning. Protect your businesses and adhere to tax legislation for successful development in today's tax environment. 📹 If you were unable to attend the meeting in person or would like to rewatch the event, you can follow the link. The event recording is available on the Kharkiv IT Cluster YouTube channel. We would like to express our sincere gratitude to Crowe Mikhailenko for their support in hosting our Legal Talk by Kharkiv IT Cluster webinar. We extend our thanks to Happy Monday, Odessa IT Family, and 1991 Accelerator for their support in the information space, making our event beneficial for a wide audience of IT companies. Join the Cluster in the Cloud project—become part of a progressive community, and receive unique offers and cluster services available only to participants.