Transfer Pricing Law in Ukraine Will Become Effec... | KPMG | UA

Transfer Pricing Law in Ukraine Will Become Effective on September 1st 2013

Transfer Pricing Law in Ukraine Will Become Effec...

On July 4th 2013, the Law “On the Amendments to the Tax Code of Ukraine Regarding Transfer Pricing” passed its second and final reading and was adopted by the Ukrainian Parliament. It will become effective on September 1st 2013, and not on January 1st 2014 as was previously expected.

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The Law brings i.a. the following changes to the existing transfer pricing rules in Ukraine:

  • it abolishes the permitted 20% deviation from a market price;
  • it introduces special transfer pricing audits;
  •  It imposes an obligation for taxpayers to prepare and file a notification on controlled transactions and transfer pricing documentation file. Large taxpayers will be obliged to submit transfer pricing documentation within 2 months of request from the tax authorities. All other taxpayers will have to submit transfer pricing documentation within 1 month of request. All taxpayers will be obliged to file reports on the conducted controlled transactions annually until May 1st of the year following the reporting year;
  • it imposes penalties for non-compliance:
    • 5% of the total controlled transactions’ value for the failure to file a notification on controlled transactions;
    • 100 minimal wages for failure to file transfer pricing documentation file by large taxpayers.


    KPMG has a dedicated transfer pricing team consisting of 6 tax experts. Since the beginning of 2013, the team has successfully completed a number of projects for Russian and international clients. Konstantin Karpushin, head of the Transfer Pricing Group in Ukraine, has more than seven years of experience resolving complex transfer pricing issues, which he gained during his work in Russia and Finland.

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