On February 21, 2018, the Resolution of the Cabinet of Ministers of 7.02.2018 No. 85 came into force, approving the procedure for granting an installment plan for VAT payment when importing the equipment for own production into Ukraine (hereinafter – Procedure) in accordance with clause 65, subsection 2, section XX of the TCU, No.2245-VIII of 07.12.2017.
The Procedure provides that in order to receive an installment plan for the payment of value-added tax, when importing equipment into the customs territory of Ukraine, the payer is obliged to submit an application to the customs office, which form must be also approved by the above-mentioned resolution. The application must specify the term of the installment plan, name, quantity, cost and code of the the UCG FEA of the imported equipment, its location, the purpose of importation, the CFEA of the payer, etc. The payer must attach the following to the application:
- business project, business plan or other document with a detailed description of the technological process (with economic calculations) and expected performance;
- available conclusions of state bodies, expert institutions, organizations, state standards and enterprise standards, technical conditions, technical documentation, documents confirming the availability of production capacities, premises;
- documents provided for in Article 335 of the Tax Code of Ukraine, which are necessary for passing customs control.
Within 10 working days from the date of receipt of the application, the customs authority makes a decision on granting an installment plan for the payment of VAT or its refusal, on the recommendation of the commission established by its decision. It should be noted that if, on the date of receipt of the application, the amount of the tax claimed for installment plan is more than 1,000,000 UAH, then the decision period may take up to 25 working days in connection with the need to coordinate the decision with the Chairman of the State Fiscal Service of Ukraine. Such decisions will be published on the official website of the SFS.
The new Procedure also provides for exceptional cases in which the customs may refuse to provide installment plan, namely in the following cases:
- if the right for installment plan of such equipment by the appropriate code of the UCG FEA is not provided for by clause 65 of subsection 2 in section XX of the Tax Code of Ukraine;
- non-confirmation of the cost of equipment specified in the application;
- confirmation that the equipment comes from or is imported from the territory of Russia;
- non-compliance of the CFEA, specified in the application, corresponding to the CFEA, specified in the Unified State Register of Legal Entities, Individual Entrepreneurs and Public Associations;
- if a taxpayer has a debt in tax payments and some special sanctions applied to him in accordance with Article 37 of the Law of Ukraine “On Foreign Economic Activity”;
- non-confirmation of the availability of production capacity or premises or conditions for the registration and storage of goods, finished product;
- determination of the circumstances not reflected in the documents of the taxpayer;
- non-compliance with other mandatory requirements determined by the current Procedure.
If the customs authority makes a positive decision, during the entire period of using the installment plan, the taxpayer will be obliged, not later than the working day following the day of payment of the part of extended amount of VAT, to submit the report on the targeted use of the imported equipment, which form is also approved by the Resolution No. 85 of the Cabinet of Ministers, to the relevant main office of the SFS in the region, in Kyiv or in the office of large taxpayers of the SFS .