The fictitiousness of your counterparty does not yet testify about the fictitiousness of economic relations

The plot. One of the enterprises of the city of Kiev carries out complex repair work on buildings (painting, minor repairs of equipment and furniture, repairing air conditioners, replacing electric lamps, servicing air conditioners, cleaning, etc.). The biggest problem of this enterprise is the presence of workers. Since this kind of work is not highly paid, there is a constant stream of workers in the enterprise, someone is constantly being released, and someone is getting a job. As a result of the search for workers, an enterprise, through the site of the OLH, finds a brigade of 10 people that is ready to perform certain work. After negotiations with the team leader and agreements, the team proceeds to perform work at the facility, after the completion of work, they are accepted by the responsible person of the customer’s enterprise.

Next is the problem. As it turned out, all employees are individuals and do not conduct business as a company or LLC. And their leader was counting on cash. However, the company that ordered the work carries out its activities in the form of LLC, and therefore cash payments can not be. In order to address this issue, the manager opens an LLC for one of his employees and issues an invoice for the work performed. The company pays for the work performed in accordance with the invoice, all primary documents are signed. So, the work is done, all the necessary documents are concluded, the work has been paid. The question is closed.
Next problem. An LLC that was opened to an employee does not file reports, does not pay taxes. Employees of the DFS come to the employee and he testifies that this LLC is not related and has registered it for a cash reward. By agreement with the prosecutor, the employee is convicted under Art. 205 of the Criminal Code of Ukraine (fictitious business) and he receives a fine of 8500 UAH. And after that there are problems at the enterprise. The tax police begins criminal proceedings under Art. 212 of the Criminal Code of Ukraine (evasion of taxes, fees, other mandatory payments), and the DFS sends a tax notice decision (CPD).
How to act in such a situation? Definitely contact the relevant lawyers, as in each individual case there are different approaches to proving your innocence, because the company cannot and should not be responsible for the actions or inaction of its counterparties. At the same time, it is always necessary to remember that all circumstances require proof (documents, certificates, videos and sound recordings). Therefore, such evidence must be kept.
What does judicial practice say about this? The Supreme Court of Ukraine, in the presence of a sentence, which confirms the creation of a fictitious company by the counterparty director, supported the position of the supervisory authority and noted that the primary documents that served as the basis for the formation of the tax credit were written out by the counterparty, the fictitiousness of the economic activity of which was established can be properly executed and signed primary documents (resolution of the Supreme Court of Ukraine dated November 17, 2015, case No. 2a / 3264/11/1070 ). Also, the Supreme Court of Ukraine has repeatedly pointed out that the status of a fictitious, illegal enterprise is incompatible with legal business activities (resolutions of the Supreme Court of Ukraine on September 12, 2017. In case No. 21-3775-16 and on December 1, 2015. In case No. 21- 3788-15).
In December 2017, taxpayers had high hopes that this would change after the creation of a new Supreme Court.
And therefore, the Supreme Court in its decision of 02.27.2018 p. In case No. 813/1766/17, taking a cardinal decision in favor of a business entity, concluded that the verdicts relied upon by the supervisory authority did not establish the circumstances confirming the impossibility of exercising business transactions with a business entity – the taxpayer. Also, the panel of judges of the Cassation Administrative Court of the Supreme Court noted that the fact of the existence of sentences does not give grounds for an automatic conclusion about the unreality of business operations, as a result of which it is necessary to check the evidence of each tax offense and comprehensively investigate all the components of business operations in sentences that have entered into force.
The Supreme Court has already expressed a similar legal position in the following decisions of 11/20/2018. In case No. 808/2858/16; from 19.09.2018 g. in the case of № 809/2438/15; from 31.07.2018 p. in case No. 808/1507/16; from 05.06.2018 p. in case number 2a-1570/6063/12; from 04.17.2018 p. in case No. 808/2459/17; from 27.03.2018 p. in the case of №815 / 6470/16.

In addition, the Supreme Court in its decision of 06/20/2018 p. In case No. 82/4465/13, drew attention to the fact that the person who was convicted was the same person who signed the documents from the counterparty of the business entity the basis of which the latter formed expenses, tax credit, and also coincides with the period of the crime with the period in which the relevant documents were signed.
And one of the ways to solve this problem, which could put all the dots on “and”, is the transfer of one of these cases to the Grand Chamber of the Supreme Court. Trying to solve the existing problem of the ambiguity of judicial practice in the above-mentioned category of cases, the Trial Chamber for Resolving Tax Disputes of the Cassation Administrative Court of the Supreme Court by decision of February 21, 2018. In case No. 826/19939/16 referred to the Grand Chamber of the Supreme Court the case where there was an existing conviction under Article 205 of the Criminal Code of Ukraine – it was an administrative case under the claim of Foodmerezh LLC to the Office of the major taxpayers of the State Fiscal Service. The only reason for the transfer was the presence in the case, according to the Chamber of Tax Dispute Resolution of the Cassation Administrative Court within the Supreme Court – this is the problem of the court evaluating the sentence, which establishes the fact of fictitiousness of economic activity.
The Grand Chamber of the Supreme Court did not agree with the findings of the Tax Chamber of Resolving Tax Disputes of the Administrative Court of Cassation as part of the Supreme Court and returned the said case to the Administrative Court of Cassation for a new trial. The main position of the Grand Chamber of the Supreme Court on this issue was that the existence of a sentence for fictitious entrepreneurship regarding the director of the counterparty was justified by the Grand Chamber by the fact that in each particular case the courts must provide a legal assessment of the factual circumstances of the case when considering similar disputes.
Consequently, this issue is relevant today, there is no final decision of the Grand Chamber of the Supreme Court, judicial practice on disputes under Article 205 of the Criminal Code of Ukraine is rather contradictory, and therefore neither the Grand Chamber nor the Court of Cassation as part of the Supreme Court is a unified approach to resolving disputes over the DFS the presence of a sentence, on the fictitiousness of business activities not found. Therefore, payers with a “positive” are waiting for the solution of this problem, where the fines that the DFS bodies endure sometimes amount to a million hryvnias, which worsens the financial situation of any enterprise.
How wake up with criminal proceedings? At the same time, the existence of a court decision on the abolition of the PPR is grounds for closing the criminal proceedings under art. 212 of the Criminal Code of Ukraine, in particular on the basis of paragraph 2 of Part 1 of Art. 284 of the Criminal Procedure Code of Ukraine (the absence of a criminal offense in the act was established), since the abolition of the CPD confirms the absence of damage, and the absence of harm indicates the absence of an objective party to the crime.

Author: Andrey Prikhodko

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