HOW THE TAX REFORM WILL AFFECT CHECKS?

 In order to understand tax audits by a report, it is necessary to carefully analyze the Law of Ukraine № 466. Most likely, the ban on tax audits may end at the end of this month.

 Inspections are divided into scheduled and unscheduled. According to paragraph 77.2 of the Tax Code of Ukraine, it is possible to make some changes to the schedule of documentary inspections during the year. But such changes can be made no more than once in the first quarter and once in the second quarter of this year. An exception is possible when the changes that are made are connected with the change of the payer, which is included in the schedule of inspections. Or correction of technical errors that were made. What is important, if changes to the schedule were made in the 1st quarter, then the audit can begin no earlier than in the third quarter of this year, and if in the second - then the audit can begin no earlier than in the 4th quarter of this year. This norm has already entered into force on May 23, 2020.

 The following is important information regarding the procedure for giving the taxpayer a notice of verification. If the payer submits to the fiscal service applications for correspondence in electronic form, via an electronic address, the message about the verification will be in the Payer's Electronic Account in electronic form. And in ordinary paper form will only be issued at the request of the person. This norm will enter into force on July 01, 2020.

 Unscheduled documentary checks

 On conducting unscheduled documentary checks, they can be carried out solely on the basis of a court decision to conduct such an audit. But there are new reasons for an unscheduled inspection. These include:

1. The body that conducted the planned documentary audit received information, or such information was received from foreign authorities, which shows that the taxpayer violates tax laws on issues that have already been investigated during the audit. It will only check what has become the basis for such an inspection. This rate will work from July 2020. It is worth noting that such checks can be carried out without delivery of a copy of the order to conduct such an unscheduled check.
2. The tax authorities received information that a non-resident carries out business activities through a permanent establishment, is not put on tax records.
   Another novelty concerns criminal proceedings. Inspections can be carried out solely on the grounds set forth in the TCU. This norm is enshrined in paragraph 78.2. NKU.

 Approval for verification

 Clause 81.2 of the Tax Code of Ukraine is supplemented with a new paragraph, that if the organization of any audit is established by the impossibility of conducting it by officials of the body that should conduct the audit, an act is drawn up that it must confirm this. Materials that can confirm this fact must be attached to this act. Such materials should be sent to the taxpayer.

 Inspection Duration

 The law did not extend the time limits for conducting inspections; they remained as they were. But if the taxpayer submitted documents for conducting an unscheduled audit in less than three business days, then the timing can be continued in accordance with paragraph 82.2 of the Tax Code of Ukraine for 3 business days.

 A similar norm was still indicated in paragraph 44.7 of the Tax Code of Ukraine, but now it has been more concretized.

 As for the suspension of the documentary audit (planned or unscheduled), now it can be done in relation to any payer, although this only concerned a large taxpayer. The suspension of the inspection must be executed by order, a copy of which must be delivered to the payer no later than the next business day. If there is an application for correspondence in electronic form, then it has been sent to the Electronic Cabinet.

Provision of documents

 The procedure for submitting documents for verification is established by Art. 85 of the Tax Code of Ukraine. This article establishes that when conducting an audit to obtain certified copies of documents, the inspection authorities must send the request to the payer no later than five business days before the end of the audit. If this period is violated, the payer has the right to demand that the check be stopped for at least 5 working days.

New rights of inspection bodies during inspections

 On May 23, 2020, tax inspectors received the right, during the audit, to receive written explanations from officials on issues related to the subject of the audit (paragraph 20.1.46 of the Tax Code of Ukraine).

 But in clause 16.1.15 of the Tax Code of Ukraine, the obligation is established by the taxpayer to provide officials with written explanations at the request of regulatory authorities on issues that relate to the subject of inspections.

Limitation period

 The statute of limitations is 1095 days. That is, tax authorities do not have the right to charge penalties more than 1095 days from the date of the last deadline for filing a tax return. And if such a declaration was filed later, then from the date of actual filing. To carry out control operations, the limitation period since it is still 2555 days.

Other innovations

 To check tax obligations regarding the payment of taxes on personal income, military duty and other payments that are accrued to an individual in the course of employment, the limitation period is 2555 days, i.e. 7 years.

 But the innovations regulating the statute of limitations enter into force only in January 2021, they are enshrined in Art. 102 of the Tax Code of Ukraine.

 In addition to the above, in paragraph 102.2 of the Tax Code for the application of sanctions for violation of other requirements of tax legislation, including for the declaration of tax obligations, as well as other legislation, the control of which is assigned to controlling bodies the limitation period is no more than 1095 days from the day the offense was committed.

 In the event that clarification of the countdown has been submitted, it will be charged from the day of filing, as now. But verification will be possible only within the framework of the clarifications provided, which is now not indicated in Art. 102 GCC.

 As for local taxes and fees for which an annual tax return is required, the regulatory body can independently determine the amount of obligations, but no later than the end of 1095 days following the last day of the deadline for paying these taxes.