The form of the Report on Controlled Transactions has been amended

The tax authorities inform about changes to the form of the Report on Controlled Transactions (hereinafter referred to as the "Report on CT") approved by Order of the Ministry of Finance No. 8 dated January 18, 2016 (as amended by Order of the Ministry of Finance No. 841 dated December 31, 2020) (hereinafter referred to as "Order No. 8"), in particular, it is set out in a new version;

♦ Amendments were made to the Annex TC to the Corporate Profit Tax Return approved by the Order of the Ministry of Finance No. 897 dated October 20, 2015 (as amended by the Order of the Ministry of Finance No. 101 dated February 20, 2023) (hereinafter - Annex TC), in particular, it was set out in a new version;

♦ Amendments to the Procedure for Preparation of the Report on Controlled Transactions (hereinafter - the Procedure), approved by Order No. 8, were approved.

♦ On February 6, 2024, Orders No. 673 (page 766) and No. 725 (page 768) were published in the Official Gazette of Ukraine No. 11 and entered into force.

The Order of the Ministry of Finance No. 673 dated 07.12.2023 "On Amendments to Certain Regulatory Acts of the Ministry of Finance of Ukraine" was issued to implement subparagraph 39.4.2 and paragraph 46.6 of the Tax Code and provides for the improvement of control over compliance with the arm's length principle in controlled transactions.

The form of the Controller's Report has undergone significant changes, in particular:

♦ in column 2 "Payer" - in case of submission of the KO Report by a non-resident that carries out business activities in Ukraine through a permanent establishment, the full name of such non-resident shall be indicated for the permanent establishment;

♦ in column 3 "Tax number" - in case of submission of the KO Report by a non-resident that carries out economic activity in the territory of Ukraine through a permanent establishment, the tax number and the main code of economic activity of such non-resident shall be indicated for the permanent establishment; the KO Report form has been supplemented with new columns:

♦ column 7. "Information about non-resident***" - to be filled in only if a non-resident submits the Report on a PE for a permanent establishment;

♦ column 7.1. "Name of the non-resident's country of registration (according to the List of country codes for statistical purposes, in Ukrainian)"

♦ column 7.2. "Digital code of the non-resident's country of registration (according to the List of country codes for statistical purposes)";

♦ column 7.3. "Name of the controlling authority at the main place of registration of the non-resident";

♦ column 8. "Information on the permanent establishment through which the non-resident carries out activities in the territory of Ukraine";

♦ column 8.1. "Full name of the permanent establishment"; column 8.2. "EDRPOU code of the non-resident's permanent establishment or taxable entity identifier (in the absence of the EDRPOU code)"; column 8.3. "Location of the permanent establishment"; column 8.4. "Name of the controlling authority at the main place of registration of the permanent establishment".

In the table "General Information on Controlled Transactions", in particular, the title of column 2 was changed to "Full name of the person participating in the controlled transaction"; column 4 - to "Digital code of the country of registration"; column 5 - to "Total amount of controlled transactions with the counterparty (in total) (UAH)".

The following amendments were made to the form of the Annex to the KO Report "Information on the Person Conducting Controlled Transactions":

♦ the order of filling in the information columns "Location of the person" and "Person's code";

♦ the location of the column "Code(s) of grounds for classifying a transaction as controlled", which provides for the mandatory filling in of at least one ground, and in the presence of several grounds - classification of business transactions as controlled with a mandatory note on all such grounds (note "i"); the procedure for displaying and storing information on the ground codes, namely: a) each ground code is filled in in a separate cell - with a "+" mark;

b) the procedure for displaying and storing information on the ground code "010" has been changed, which provides for the mandatory filling in of the sign of relatedness of persons: opposite "yes", a "+" mark is indicated, otherwise, opposite "no", a "+" mark is indicated (note "2"). If the "no" cell is filled in, then one or more of the fields "015", "020", "030", "040", "050" must be filled in;

♦ the column "Code(s) of signs of relatedness of a person (values from the interval from 501-518, 523, 524)" provides for filling in at least one of the codes of signs of relatedness of persons by the taxpayer in case of controlled transactions with related non-resident persons, in the presence of several signs of relatedness of persons - it is mandatory to mark all such codes (note "З").

In the table "Information on Controlled Transactions":

♦ the name of column 1 "Controlled transaction number4" has been changed, which is filled in with an increasing serial number of the line when adding them to the table, depending on the number of counterparties - parties to controlled transactions. If the Annex TC to the Corporate Profit Tax Return for the relevant period is submitted, the serial number of the controlled transaction in column 15 of such annex (note "4") shall be indicated first;

column 5 "code of goods under UKT ZED5" indicates the code of the commodity subcategory in accordance with the Law of Ukraine "On Customs Tariff of Ukraine" (note "5");

♦ in column 6 "code of service according to the Classification of foreign economic services6", if the counterparty in the controlled transactions is a resident of Ukraine, the code of the subject of the transaction according to the State Classifier of Products and Services DK 016:2010 shall be indicated (note "6");

♦ the name of the combined columns 7-8 "Contract (agreement)/Addendum (amendment) to the contract (agreement)" was changed;

♦ the title of column 11 "Delivery Terms (Incoterms)" was changed and divided into 2 columns, in particular, column 11 "Incoterms delivery terms code" and column 11.1 "place of delivery" are now available;

♦ in column 17 "Amount7", if the subject of the controlled transaction is financial services for granting/receiving a loan, deposit, or credit, the amount of interest accrued or received during the respective controlled transaction in the currency of the contract (note "7") shall be indicated;

♦ in column 17.1 "Amount under the contract", if the type code of the subject of the transaction specified in column 3 is 205 or 206, the amount of the loan, deposit, or borrowing under the terms of the contract in the currency of the contract shall be indicated (note "7");

column 19 "Currency code" is supplemented by column 19.1 "Exchange rate as of the date of recording of the controlled transaction in the accounting".

Amendments to the Procedure for Preparing the KO Report:

Section I is supplemented with a new paragraph:

"8. A non-resident that carries out business activities in Ukraine through a permanent establishment shall submit the Report at the main place of registration of the permanent establishment.

If a non-resident has two or more permanent establishments, the non-resident shall prepare and submit a separate Report for each permanent establishment at their main place of registration.".

In section II:

the wording of the following headings/items has been changed:

paragraph 2 - "Column 2 shall indicate the full name of the taxpayer according to the registration documents. In case of submission of the Report by a non-resident that carries out business activities in the territory of Ukraine through a permanent establishment, the full name of such non-resident shall be indicated."

second paragraph of clause 3 - "A taxpayer who does not have a USREOU code shall indicate the taxpayer's registration number assigned by the supervisory authority."

Clause 3 is supplemented with a new paragraph - "In case of submission of the Report by a non-resident that carries out economic activities in the territory of Ukraine through a permanent establishment, the account number and the main code of economic activity of such non-resident shall be indicated."

clause 4 is supplemented with a new sentence - "In case of submission of the Report by a non-resident that carries out economic activity on the territory of Ukraine through a permanent establishment, the location of such non-resident in Ukraine shall be indicated."

paragraph 5 - "Column 5 shall indicate the controlling authority to which the Report is submitted. In case of submission of the Report by a non-resident that carries out economic activity in the territory of Ukraine through a permanent establishment, the supervisory authority at the main place of registration of the permanent establishment shall be indicated."

supplemented with new paragraphs:

"7. Box 7 shall be filled in only by a non-resident. In columns 7.1 - 7.3, the name and code of the non-resident's country of registration (according to the List of country codes for statistical purposes), the name of the supervisory authority at the main place of registration of the non-resident shall be indicated.

8. Column 8 shall be filled in only in case of submission of the Report by a non-resident that carries out economic activity in the territory of Ukraine through a permanent establishment.

Columns 8.1 - 8.4 shall contain the full name, EDRPOU code or taxable entity identifier (in the absence of EDRPOU code), location of the permanent establishment, name of the supervisory authority at the main place of registration of the permanent establishment."

In section III:

paragraph 3 is supplemented with the second sentence: "In case of submission of the Report by a non-resident that carries out business activities in the territory of Ukraine through a permanent establishment, the code of such non-resident in the country of registration shall be indicated."

In this regard, the second sentence of clause 3 shall be considered the third sentence;

clause 4 after the words "controlled transaction" shall be supplemented with "(in case of submission of the Report by a non-resident carrying out economic activity in the territory of Ukraine through a permanent establishment, the code of the non-resident's country of registration shall be indicated)".

In section IV:

in paragraph 4:

in subparagraph 1, the field "Full name of the person" is replaced by "Full name of the person participating in the controlled transaction";

the wording of subparagraph 4 was changed - "'Digital code of the country of registration' means the country code in accordance with the List of World Country Codes for Statistical Purposes approved by the Order of the State Statistics Service of Ukraine dated January 08, 2020 No. 32, which must coincide with the digital code of the country of registration specified in column 4 of the General Information on Controlled Transactions of the main part of the Report;";

the wording of subparagraph 6 was changed - ""Code(s) of the grounds for classifying a transaction as controlled" - the code in accordance with Annex 1 to this Procedure. At least one ground must be filled in, and if there are several grounds for classifying business transactions as controlled, all such grounds must be indicated."

clause 10 is supplemented with a new paragraph - "If the code of the type of the subject of the transaction specified in column 3 is equal to 201 or 209, the code of the goods in accordance with the UKTZED shall be indicated in column 5."

Clause 11 is supplemented with a new paragraph - "If the type code of the subject of the transaction specified in column 3 is equal to 204, 205, 206 or 207, the UKEP shall be indicated in column 7 without fail."

the wording of clause 12 was amended - "Columns 7 and 8 shall contain information on the contract (agreement)/addendum (amendment) to the contract (agreement) under which the controlled transaction was carried out. In the case of a controlled transaction without a contract (agreement), the details of the document on the basis of which the controlled transaction was carried out shall be indicated.

In case of a controlled transaction subject to the terms of an amendment (change) to the contract (agreement), information on such amendment (change) to the contract (agreement) shall be indicated."

the wording of clause 15 was amended - "In column 11, the code of the terms of delivery of goods in foreign economic operations in accordance with the Incoterms rules shall be indicated.

If columns 7 and 8 are filled in with information on additions (amendments) to the contract (agreement), column 11 shall contain information on the terms of delivery of goods, taking into account such addition (amendment) to the contract (agreement).

In accordance with the Incoterms rules, column 11.1 shall indicate the name of the place of delivery of the goods (destination).

In case of filling in columns 7 and 8 with information on additions (amendments) to the contract (agreement), column 11.1 shall contain information on the name of the place of delivery of goods (destination), taking into account such addition (amendment) to the contract (agreement)."

Clause 21 is supplemented with a new paragraph - "Column 17.1 shall indicate the amount of credit, deposit, loan under the terms of the contract in the currency of the contract, if the type code of the subject of the transaction specified in column 3 is 205 or 206."

the wording of paragraph 23 was changed - "In column 19, the currency code is indicated in accordance with the Classifier of Foreign Currencies and Banking Metals approved by Resolution of the Board of the National Bank of Ukraine No. 34 dated February 4, 1998 (as amended by Resolution of the Board of the National Bank of Ukraine No. 269 dated April 19, 2016). If the hryvnia is used as the currency of the contract (agreement), code 980 shall be indicated.

Column 19.1 shall indicate the official exchange rate of hryvnia to foreign currency as of the date of recording the controlled transaction in the accounting records."

In Section V:

Paragraph 4 is supplemented with a new paragraph "In column 17.1, the total amount of the credit, deposit, loan under the terms of the contract in the currency of the contract shall be indicated if the type code of the subject of the transaction specified in column 3 is 205 or 206."

The following changes have been made to the form of Appendix TC: the name of column 4 "Digital code of the country of registration" has been changed; the name of the combined columns 5-6 "Contract (agreement)/Addendum (amendment) to the contract (agreement)" has been changed;

in the field "When selling goods (works, services)":

the name of column 16 "minimum value of the price range/minimum value of the profitability range for a resident/maximum value of the profitability range for a non-resident" was changed

supplemented with columns 17.1 "price/indicator to be adjusted"

17.2 "quantity/volume to be adjusted", 17.3 "units of measurement"; in the field "When purchasing goods (works, services)"

the title of column 18 "maximum value of the price range/minimum value of the profitability range for a resident/maximum value of the profitability range for a non-resident" was changed;

supplemented with columns 19.1 "price/indicator to be adjusted",

19.2 "quantity/volume to be adjusted", 19.3 "units of measurement";

in the field "Adjustments for goods (works, services), except for securities, transactions with which are reflected in the appendix CP to line 4.1.3 of the appendix PI of the corporate income tax return", the word "Adjustment" is deleted;

the numbers of notes and columns to which they apply were supplemented and changed:

note 1 "To be submitted in case of self-correction by the taxpayer made in accordance with subparagraph 39.5.4 of paragraph 39.5 of Article 39 of Section I of the Tax Code of Ukraine." is used in the title of Appendix TC "Self-Correction of the Price of a Controlled Transaction and Amounts of Tax Liabilities of the Taxpayer";

note 2 "Information of columns 1-15 shall be formed in accordance with the Procedure for Preparation of the Report on Controlled Transactions approved by the Order of the Ministry of Finance of Ukraine dated January 18, 2016 No. 8, registered with the Ministry of Justice of Ukraine on February 4, 2016 under No. 187/28317 (as amended by the Order of the Ministry of Finance of Ukraine dated December 31, 2020 No. 841)." applies to the fields "General Information", "Date of Transaction", columns 8, 9;

note 3 "In accordance with the List of Country Codes for Statistical Purposes, approved by the Order of the State Statistics Service of Ukraine dated January 08, 2020 No. 32." shall be applied to columns 3, 4;

note 4 "The code of the commodity subcategory according to the Law of Ukraine "On Customs Tariff of Ukraine" shall be indicated." shall be applied to column 10;

note 5 "If the counterparty in controlled transactions is a resident of Ukraine, the code of the subject of the transaction according to the State Classifier of Products and Services DK 016:2010 shall be indicated." applies to column 11;

note 6 "The column coincides with the number of the annex to the Report on Controlled Transactions submitted by the taxpayer in accordance with subparagraph 39.4.2 of paragraph 39.4 of Article 39 of Section I of the Tax Code of Ukraine. The column shall not be filled in if the Report on Controlled Transactions for the relevant period has not been submitted." shall be applied to column 6;

note 7 "The number in order from column 1 of the section "Information on Controlled Transactions" of the annex to the Report on Controlled Transactions submitted by the taxpayer in accordance with subparagraph 39.4.2 of paragraph 39.4 of Article 39 of Section I of the Tax Code of Ukraine shall be indicated. The column shall not be filled in if the Report on Controlled Transactions for the relevant period is not submitted." shall be applied to column 15;

note 8 "Indicate the price/profitability range to which the tax liabilities were adjusted. If the profitability range indicator is used, the percentage value of such indicator shall be indicated." shall be applied to columns 16, 18;

Note 9 "Total value: column 17 shall be reflected in line 3.1.3 of TC of Annex PI to line 03 PI of the Corporate Income Tax Return and/or in column 3 of line 37 of Annex DIA to the Corporate Income Tax Return (line 06.3 DIA); column 19 shall be reflected in line 3.1.4 TC of the appendix PI to line 03 PI of the corporate income tax return and/or in column 3 of line 38 of the appendix DIA to the corporate income tax return (line 06.3 DIA)." is applied to the cell "Total" of the field "Concerning goods (works, services), except for securities, transactions with which are reflected in the appendix CP to line 4.1.3 of the appendix PI of the corporate income tax return";

Note 10 "Total value: columns 17 shall be reflected in line 01.12 of the TC of the CP Annex to lines 4.1.3 CP, 4.1.4 CP of the PI Annex to line 03 PI of the Corporate Income Tax Return; columns 19 shall be reflected in line 02.12 of the TC of the CP Annex to lines 4.1.3 CP, 4.1.4 ЦП of the Annex PI to line 03 PI of the Corporate Income Tax Return." is applied to the cell "Total" of the field "Securities, transactions with which are reflected in the Annex CP to line 4.1.3 of the Annex PI of the Corporate Income Tax Return".

In view of the above, the Report on Controlled Transactions carried out by taxpayers during the 2023 reporting year must be prepared and submitted to the supervisory authority in the updated form and in accordance with the Procedure approved by Order No. 673.

At the same time, the Reports on Controlled Transactions carried out by taxpayers during the 2023 reporting year, submitted by taxpayers before the entry into force of Order No. 673 and the development of appropriate electronic formats for submitting the Report on Controlled Transactions in the updated form, are considered valid.

Clause 46.6 of the TCU provides that if tax reporting forms change as a result of changes in the taxation rules, until the new forms of declarations (calculations) are determined and become effective for reporting for the tax period following the tax period in which they were published, the forms of declarations (calculations) effective before such determination are valid.

Pursuant to clause 50.1 of the TCU, in case of submission of an adjusting calculation to the corporate income tax return for the previous tax (reporting) year for the purpose of making an independent adjustment in accordance with Article 39 of the TCU or in determining the tax base in accordance with sub-clause 141.91.3 of the TCU in case of controlled transactions, if their terms do not comply with the arm's length principle, no later than October 1 of the year following the reporting year, a penalty of 3% of the amount of underpayment shall not be applied.

Taking into account the above, in case of self-correction of the price of a controlled transaction and the amount of tax liabilities of the taxpayer, carried out in accordance with subparagraph 39.5.4 of the TCU, the taxpayers will be able to submit the Annex TC to the Corporate Income Tax Return in an updated form (including in connection with the clarification of indicators for the tax (reporting) year 2023), starting from 01.07.2024 .