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Ukraine Publishes Guidance on Exemptions from Advance Tax Payments on Dividends — Orbitax Tax News & Alerts

Guidance was recently published from Ukraine's State Tax Service regarding different exemptions from the advance tax on dividend payments (18%). This includes an exemption for the following payments:

  • Dividends paid to shareholders of a parent company not exceeding the amount of dividend income received by the parent company from other sources, with any excess subject to advance tax;
  • Dividends paid out of income that is exempt from taxation, up to the exempt income amount in the period in which the dividends are paid;
  • Dividends paid to individuals, including dividends paid on preference shares or other rights providing for the payment of a fixed amount of dividends or an amount greater than the amount of dividend payments calculated on other shares, which is equated for the purpose of taxation as the payment of wages with the corresponding taxation (i.e., not taxed as dividends);
  • Dividends paid by mutual investment institutions; and
  • Payments that are deemed as (equated to) dividend payments, including different payments to non-residents in controlled transactions exceeding the arm's length amount, the understated value of sales to non-residents below the arm's length price, and payments to non-resident founders/participants in relation to a reduction in authorized capital leading to a reduction in retained earnings.

Click the following link for the guidance (Ukrainian language).