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Lawyer's Blogs

Tax planning: optimization, minimization and avoidance of taxes

Published:   16.05.2018 | blog

Taking into account an extremely unstable tax legislation of Ukraine, more and more business owners are thinking about tax planning for their enterprise or holding. Tax planning is the process of choosing the most optimal form of taxation and reducing the tax burden on business by using certain methods. Methods of tax planning for business The methods or ways by which tax planning is implemented can be conditionally divided into: tax optimization; tax minimization; tax avoidance. The main principle of these methods is that they should not go beyond the legal field, that is, their implementation is carried out exclusively within the framework of the current legislation. However, not everyone can clearly see the line between the tax optimization, tax minimization, tax avoidance and tax evasion. Many people, implementing tax planning, are guided precisely by the tax avoidance, which has a very fine line with such a concept as tax evasion. And this, in turn, often leads to problems with fiscal authorities and in some cases ends with additional charges, fines, and sometimes criminal cases. It should be noted that tax planning is widely used throughout the world by both...

Offshore for Trading Activities: Is It Necessary

Published:   16.05.2018 | blog

Until recently, offshore companies have been actively used by the Ukrainian entrepreneurs in international trade to reduce the tax burden and keep business confidentiality. We will consider in this blog whether the situation has changed in the conditions of global deoffshorization, and in particular, tightening of the Ukrainian legislation. The field of trade has always been the simplest and most popular for offshore applications. One of the main goals of using offshore schemes in export-import transactions was to regulate the customs value of the goods, and, accordingly, the company’s trading profits. Offshore companies in such schemes were used as intermediaries between the seller and the buyer for the understatement of the value of goods during the export and overstatement - upon import. However, the process of deoffshorization has reached our country. The provisions for the control of transfer pricing started working in the Ukrainian legislation. The Cabinet of Ministers has approved and periodically reviews the list of the countries with preferential taxation (it includes both classic offshores and jurisdictions, the income tax rate for the companies which have 5 or more...

“Point of No Return” in the Legal Regulation of Cryptocurrency in Ukraine

Published:   11.05.2018 | blog

On May 7, the 43rd Annual Conference of the International Organization of Securities Commissions (IOSCO) began its work in Budapest. The head of the National Securities and Stock Market Commission Timur Khromaev represent Ukraine at the conference. During the work of the relevant committees and regulatory seminars, Timur Khromaev pointed out that the regulator is in favor of making a decision to recognize cryptocurrency as a financial instrument. The official believes that Ukraine has already passed the “point of no return” regarding this issue and it is time for its consideration by the financial regulator of the country. It is expected that Ukraine’s securities regulator will raise the issue of the status of the cryptocurrency at the next meeting of the Financial Stability Board in Kyiv. The head of the National Securities and Stock Market Commission of Ukraine believes that digital currencies should be recognized as financial instruments. Such a solution will allow legalizing crypto units in the country, although not in all their possible functions. “I think it will be very timely to consider the recognition of some crypto units as financial instruments during the...

Authorized Capital of LLC: What You Need to Know

Published:   11.05.2018 | blog

Finance Business Service reminds that on 17.06.2018 the Law of Ukraine “On Limited Liability Companies” will come into force. Thus, there will be significant changes in the near future regarding the most widespread organizational and legal forms of a business entity, a limited liability company. That is, will the creation of a company, the formation of the authorized capital, the inclusion and exclusion of members of the company, management of the company, etc., take place under the new rules? In any case, the creation of a company can not be carried out without the formation of the authorized capital. The experts of Finance Business Service were analyzing the innovations in the formation of the authorized capital. As you know, the authorized capital of a limited liability company consists of contribution from its participants. The size of the authorized capital of a company will consist of the nominal value of the shares of its participants, expressed in the national currency of Ukraine and may be further determined in percentage. There are no innovations in relation to the minimum size of the authorized capital. That is, the issue of establishment of the minimum and maximum...

How the rules for LP of England, Wales, Scotland and Northern Ireland will change

Published:   08.05.2018 | blog

Essence of the scandal On April 29, a publication on the use of thousands of SLP in criminal activities appeared in the British newspaper The Times. According to the British officials, SLP was used through shills in complex schemes for money laundering. In particular, by means of the scheme, including more than 100 Scottish Limited Partnerships, about 58 billion pounds sterling, accumulated illegally, was withdrawn from Russia. More than 20 SLP was used in a fraudulent scheme, by means of which about 742 billion pounds sterling was withdrawn from Moldova. There is also a link between SLP and organized criminal groups from Eastern Europe for the purpose of conducting weapon delivery deals. All this became a reason for the announcement of the beginning of struggle against fictitious companies by Britain. And on the next day, April 30, a consultative document was posted on the official website of the British government with a number of proposals on reforming the legislation on limited partnerships to reduce the risks of their use in criminal schemes. Importance of Limited Partnerships It is worth noting that a Limited Partnership (LP), including its Scottish form, continues to...

Vehicles as an investment from a non-resident

Published:   02.05.2018 | blog

Recently, the Internet is full of information that 2018 is the latest year when it is possible to purchase a vehicle that has been used for “preferential excise tax”. As it is known, from 01.08.2016, the Law of Ukraine of May 31, No. 1389-19 on the stimulation and development of the market of second-hand vehicles, came into force. This law is valid until December 31, 2018 and provides for a significant reduction in excise tax rates for the import of used cars, subject to special conditions and restrictions. We, in turn, are talking about the acquisition of a non-used and completely new car, using a ready-made business tool - a non-resident company. The starting point of our acquisition is, in fact, the choice of a vehicle. In this case, the higher the cost of the car (its class), the more significant the saving will be. So, in stages: Choice of a vehicle. There are many online resources where you can have a great time choosing a vehicle. As an example, here is www.lexus.com. On this site, you can easily find the model you are interested in and choose the equipment that suits your needs. Perhaps, it will be necessary to enter the so-called postal code to search for the...

The EU Financial Market after Changes in Legislation: Will It Become More Transparent and Stable?

Published:   28.04.2018 | blog

The newspaper “Journal du Dimanche” previously published information about the intentions of the French President Francois Hollande to hold a meeting with the leaders of Germany, Spain and Italy on March 6 in Versailles, dedicated to the future of the European Union. This mini-summit, among other things, should have to demonstrate the unity of the leaders of the four major European powers of the euro zone in the face of the many threats and crises that the EU is currently facing. The agenda also included the study of the issues “related to ensuring the strengthening of the development of the European Union”. On March 6, the government supported the changes to the Law on the Financial Instruments Market, the Law on Alternative Investment Funds and their Managers, as well as the Audit Services Act. What is the ultimate goal of these changes? They should make the EU financial market more transparent and stable, reduce systematic risks, protect depositors, and ensure the effectiveness of financial markets and reduce the costs of their participants. The changes in the laws have been designed to adopt the Directive of the European Parliament and the Council on the markets of...

iForum – 2018: how it was

Published:   27.04.2018 | blog

On April 25, 2018 the Ukrainian forum of Internet activists was held in Kyiv. iForum is the nine main directions with thematic performances that take place simultaneously in several halls. After the official opening on the main stage, the reports continue throughout the day, without interruption. This year the following directions were presented in the program: internet business; startups; advertising and promotion; Internet technologies; future educational technologies; innovations; Blockchain, Digital Fun, CRM. Due to the fact that the emergence of the new startups on the ICO on the Ukrainian market is very topical today, the representatives of the Finance Business Service have chosen the Blockchain direction. The first performance in the Blockchain direction was the report of the representative of the Swiss office of KPMG Andre Gudel. The report referred to the publication of the Swiss Financial Market Supervisory Authority (FINMA) of the principles of application of the legislation when considering the requests from the organizers of the ICO. Unfortunately, it is not new information on the regulation of cryptocurrency in Switzerland, but,...

What danger is behind cheap offshore?

Published:   27.04.2018 | blog

Before buying an offshore, potential buyers usually compare the conditions of various vendors - so to speak, “ask the price”. At this stage, many people have the same questions: why are the prices for classic offshore companies so different? In fact, the cost of registration of such a company on the sites of competitors may be 5-10 times different. A tempting low price for an offshore company did not forebode good before, and the situation had worsened over the past year and a half to such an extent that at present, such a purchase might result in criminal prosecution. In this blog, we’ll figure out what forms the price of the offshore, how the sellers manage to reduce it and how relevant is the proverb about “cheap fish” and “bad broth”. What is included in the cost of an offshore company? The real offshore price consists of three important components, such as: Required minimum (cost price). This includes the registration of the company in the state register, payment of state duty, a basic package of documents, registration of the registration address, opening of an account in a local bank, international sending of documents and other mandatory procedures. ...

Сentral database of beneficial owners of companies is created on the BVI

Published:   20.04.2018 | blog

Following the introduction of a public register of persons with significant control for the British companies and LLP (from April 2016), as well as for the Scottish partnerships (since June 2017), some British dependent territories, under pressure from the UK itself, have created similar registers / databases. However, these centralized registers will be closed, and the access to data from them will be available only to the British competent authorities and only upon request. This decision has become a compromise after many years of negotiations and frictions, since the overseas territories, although partially subject to the law of Great Britain, are still self-regulatory. On the one hand, access to these closed registers / databases will enable the UK law enforcement agencies to monitor tax evasion, as well as terrorists and criminals hiding behind the anonymous companies. On the other hand, this will put an end to the requirements for the introduction of open registers of beneficiaries in the countries partially controlled by Great Britain. Among such states are the Cayman Islands, the British Virgin Islands, the Isle of Man, Bermuda, Guernsey, Jersey, and others. As the British...