What are the consequences of adjusting the tax credit at the request of the tax authorities?

Controlling tax authorities have always actively focused attention on untimely submission of all reports. A tax credit adjustment is no exception. Today, it is worth paying attention to the adjustment of the tax credit at the request of tax officials.

A tax credit adjustment is an increase or decrease in an existing tax credit, depending on the situation.

Adjustment period

The calculation of the adjustment to the tax invoice cannot be registered in ЕРПН later than 1095 calendar days after the date of drawing up the tax invoice, to which such adjustment calculation was made. After the specified period, such an adjustment is simply not registered.

Normative regulation

The procedure for the terms and procedure for adjusting the tax credit is determined by Clause 192.1 of Article 192 of the Tax Code of Ukraine.

Deadline for submission of correction

As a general rule, in the event of an adjustment of a tax credit registered in the National Revenue Service within a 15-day period, in the VAT tax return for the reporting (tax) period in which it was prepared, or for any subsequent reporting (tax) period, but not later than 365 days from the date of its compilation.

Who submits the adjustment?

• the supplier (seller) of goods/services, in the case of an increase in the amount of compensation for their value in favor of such a supplier or if the adjustment of quantitative and value indicators ultimately does not change the amount of compensation;
• recipient (buyer) of goods/services, in the event of a possible reduction in the amount of compensation for the cost of goods/services to their supplier, for which the supplier sends a compiled adjustment calculation to the recipient.

Consequences of adjustment

The consequences of adjusting the tax credit at the request of the tax authorities are more tangible for the seller. After all, Article 192 of the Tax Code of Ukraine does not establish restrictions on payers in terms of VAT adjustment. That is, if the RK remains unregistered after the expiry of the 1095-day period, the seller will lose his chance to reduce tax liabilities. This means that after the expiration of 1095 days, the system will not miss both the tax invoice and the calculation of the adjustment before registration.

Fines

Penalties may be applied for violation of the terms of registration of adjustment of tax credit at the request of taxes, namely fines in the amounts determined by Article 1201 of the Code of Civil Procedure.

Recommendations

For any financial or accounting transactions, it is recommended to use the help of specialists in the field of financial relations and accounting. After all, it is they who will be able to fully help in solving all problematic issues and will provide comprehensive advice in the field of tax law.