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Searches of entrepreneurs. Why nightmare business? What are the reasons for such a large number of searches?

Each of us often hears the phrase “Search is a sign of success.” All politicians from the stands say that law enforcement officers “nightmare business”, even official statistics show that Ukraine today is a world record holder in the number of searches.

At the same time, most searches are conducted in business, in offices, warehouses, at home of business owners and key managers.

? Is this really the case? From personal experience I confirm: that it is so. Every business in Ukraine that has crossed the 1 million UAH mark. a month sooner or later meets the SFS, SBU or prosecutor’s office with a search warrant.

? What is the reason?

Frankly, none of the searches defended by my lawyers or myself were completely unfounded. Of course, as a lawyer, I always found legal violations when making a decision in court, during the search itself and later when returning the confiscated property. And objectively, in most cases, the seized material evidence was later declared inadmissible, and the seized property (computer equipment, telephones, money) was returned to their owners.

But each court ruling indicated that the companies being searched were involved in the crime. Such enterprises either bought something from a fictitious firm or sold something to it. It does not happen that there are no contacts with the fictitious enterprise, and they came for a search. And this is 100% a fact! Of course, I allow exceptions, but in my experience I have not seen this.

? And now to the main thing, what is the reason for such a large number of searches?

Let’s model the situation.

You are a programmer. You have found a large VAT payer with an order for UAH 1 million. To do this, you first register a VAT company, open accounts and enter into an agreement.

And so you were paid UAH 1 million.

≡ How much tax do I have to pay and how much will I have left?

First of all, you need to register a tax invoice for your counterparty for UAH 1 million, and therefore you need to deposit funds in the amount of UAH 166,666.67 (value added tax) to the tax account. After this operation you have UAH 1,000,000.00 left – UAH 166,666.67 = UAH 833,333.33.

Then pay income tax (18 percent). UAH 833,333.33 – 18% = UAH 683,333.33 left.

After that we pay dividend tax (5 percent). UAH 683,333.33 – 5% = UAH 649,166.66.

After that we actually receive funds on our card and we can go to withdraw them to the bank. But before that you need to pay income tax as an individual (18%) and military duty (1.5%), a total of 19.5%. UAH 649,166.66 – 19.5% = UAH 522,579.16.

What is the result? From the received UAH 1 million. you will have a little more than half, you give 48% to the state.

Or you have another way – to use the services of “schemers”. You will pay them only 10-12%, and the money will be brought to you in cash.

The economic benefits are obvious!

? What about the risks?

Today, the state struggles with tax evasion through 2 institutions:

?- State Tax Service;

?- Law enforcement agencies (SFS, SBU, DBR, Prosecutor’s Office, sometimes the Police, NABU are involved).

☝ What happens in the case of the State Tax Service?

The State Tax Service detects the fact of understatement of the tax rate, conducts an inspection, draws up an act, sends you a tax notice of the decision, and if you have not appealed to the court, the amount of unpaid taxes is charged. But most importantly, this amount is not charged from you, but from your company. To avoid paying a fine, it is enough to simply sell the corporate rights. Slang – express liquidation. This procedure costs about 20 thousand UAH on the market, for these funds lawyers will find a buyer for your company and will carry out a “turnkey” re-registration without unnecessary worries. That is, the maximum risk in the relationship with the State Tax Service – is an additional cost of 20 thousand UAH. You can afford it: if you save on taxes about 400 thousand UAH.

What happens in case of detection of the fact of understatement of the tax rate by law enforcement agency. A criminal case under Art. 212 of the Criminal Code of Ukraine (tax evasion), then you will be summoned for questioning, then demand documents on the relationship with the company for which you paid, then conduct searches, possibly seize a computer, phone, and of course money, if found.

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