REDESTRUCTION OF BUSINESS FROM TEMPORARILY OCCUPIED TERRITORY

The war has made its own adjustments to the conduct of business. To date, many individual entrepreneurs have been forced to leave their settlements and evacuate to safer regions.

The legislation is also adapting to new realities, the Law of Ukraine № 1618 "On the Creation of the Free Economic Zone "Crimea" and on the Peculiarities of Economic Activities in the Temporarily Occupied Territory of Ukraine", provides that the implementation of economic activities by legal entities, individual entrepreneurs and individuals, carrying out independent professional activities, whose location (place of residence) is the temporarily occupied territory, is allowed only after changing their tax address to another territory of Ukraine.

All restrictions provided for by this Law shall apply only to the temporarily occupied territories officially recognized by the National Security and Defense Council. Prior to the adoption of such an act by the National Security and Defense Council, the implementation of activities in such territories is carried out in a general manner without the restrictions provided for by this law.

At the same time, other enterprises need to understand the state of their counterparty and whether it is safe to do business with him. After all, for example, income that is paid to an individual entrepreneur with a place of registration in the temporarily occupied territory will be taxed in Ukraine. Moreover, the one who made the payment (and not the one who received it) will pay taxes to the Ukrainian budget.

In addition, several new rules have been introduced for making payments with such individual entrepreneurs.

During the regime of temporary occupation, the payment regime is valid taking into account the fact that:

• electronic payment systems and domestic payment systems are not used in the temporarily occupied territory;
• transfer of funds between the temporarily occupied territory and other territory of Ukraine is prohibited.

A transaction, the party of which is an economic entity, the location (place of residence) of which is the temporarily occupied territory, is void. Such transactions are not subject to the provisions of the second paragraph of Part 2 of Art. 215 of the Civil Code of Ukraine.

Consequently, the current legislation makes it impossible to conduct business without changing the tax address to the controlled territory of Ukraine.

To be able to ensure the continuation of your business, Prikhodko&Partners Law Company will competently prepare all documents for re-registration and making any changes to the Unified State Register of Legal Entities and Individuals - Entrepreneurs and will solve all the problems that will arise in the process of such registration.