The Generalizing Tax Clarification as to applying the provisions of art. 18 of the Law of Ukraine “On the Regime of Foreign Investments” has been approved
Aimed at ensuring clear understanding of individual tax legislation provisions, the State Customs Service has approved a Generalizing Tax Clarification as to Applying Provisions of Art. 18 of the Law of Ukraine No. 93/96-VR of March 19, 1996 “On the Regime of Foreign Investments”.
Pursuant to art. 18 of Law No. 93/96, property imported to Ukraine as a foreign investor’s contribution to the statutory fund of enterprises with foreign investment (except for goods meant for sale or individual consumption), will be exempted from a duty. If, within three years upon transfer of a foreign investment to the balance sheet of an enterprise with foreign investments, a property that was imported to Ukraine as a contribution of a foreign investor to the statutory fund of the specified enterprises is alienated, including due to cessation of the enterprise’s activity (except for a case of transferring a foreign investment abroad), then the enterprise with foreign investments should pay an import duty calculated proceeding from the customs value of this property converted into the Ukrainian currency according to the official exchange rate as established by the NBU on the property alienation date.
In its turn, alienation of corporate rights means alienation of the right of ownership of the statutory fund (capital) or its share (stake). That is, if, prior to the expiration of the three-year period after transferring property as a foreign investment to the enterprise’s balance sheet, the statutory fund of such enterprise where a share of foreign investment forms less than 10 per cent, increases, this enterprise loses a status of an enterprise with foreign investments.
At the same time, an object covered with duty exemptions in accordance with art. 18 of Law No. 93/96, is a property that is imported as a foreign investment.
Aimed at ensuring clear understanding of individual tax legislation provisions, the State Customs Service has approved a Generalizing Tax Clarification as to Applying Provisions of Art. 18 of the Law of Ukraine No. 93/96-VR of March 19, 1996 “On the Regime of Foreign Investments”.
Pursuant to art. 18 of Law No. 93/96, property imported to Ukraine as a foreign investor’s contribution to the statutory fund of enterprises with foreign investment (except for goods meant for sale or individual consumption), will be exempted from a duty. If, within three years upon transfer of a foreign investment to the balance sheet of an enterprise with foreign investments, a property that was imported to Ukraine as a contribution of a foreign investor to the statutory fund of the specified enterprises is alienated, including due to cessation of the enterprise’s activity (except for a case of transferring a foreign investment abroad), then the enterprise with foreign investments should pay an import duty calculated proceeding from the customs value of this property converted into the Ukrainian currency according to the official exchange rate as established by the NBU on the property alienation date.
In its turn, alienation of corporate rights means alienation of the right of ownership of the statutory fund (capital) or its share (stake). That is, if, prior to the expiration of the three-year period after transferring property as a foreign investment to the enterprise’s balance sheet, the statutory fund of such enterprise where a share of foreign investment forms less than 10 per cent, increases, this enterprise loses a status of an enterprise with foreign investments.
At the same time, an object covered with duty exemptions in accordance with art. 18 of Law No. 93/96, is a property that is imported as a foreign investment.