Tax news for Ukrainian programmers

In 2013, it is planned to improve the life of the domestic IT industry. The Law N 5091-VI “On Amendments to Section XX“ Transitional Provisions ”of the Tax Code of Ukraine regarding the specifics of taxation of subjects of the software industry has been adopted.

The law provides for exemption from VAT, and a reduction in the income tax rate to 5% for subjects of the software industry. The truth is not for everyone *.

What does it give to Ukrainian programmers? You can read the full text of the Law, as well as a detailed commentary on it, in the ipLex.Profi system. And here we give a small operational analysis of the consequences for various layers of the programming population.

Work form	pros	Minuses
Freelancer - physical person, not SPD		Take advantage of the law can not. Must pay 15% of the tax on personal income 1 time per year.
SPD Group 2 (working with individuals)		It does not make sense to use the law, since it does not pay the indicated taxes.
SPD 3, group 4 and VAT non-payers	Pay 5% not from the total amount of receipts, but only from the profit.	Registration ** to receive tax-free travel permits. There is an obligation to keep records of expenses and their justification for calculating profits.
SPD 3, group 4 and VAT payers	Do not pay VAT. Do not pay 3% of turnover.	Pay 5% of the profits. Registration ** to receive tax-free travel permits. There is an obligation to keep records of expenses and their justification for calculating profits.
Firm on a common tax system.	Do not pay VAT - 20% Pay 5% of income tax instead of 19% from 2013.	There is a problem of pricing. Or do not change the price of their products and lose some customers. Because for a VAT payer, this is equivalent to an automatic rise in prices by 20%. Or reduce the price of the amount of VAT, then lose in their own profits, because the costs will remain the same.

')
* The criteria for obtaining benefits are specified in paragraph 1.4 of the Law, and briefly, something like this:
- not less than 70% of income from programming activities over the past year;
- fixed assets of at least UAH 56,700;
- there is no tax debt;
- is not bankrupt.

** The registration procedure is specified in paragraph 1.6 of the Law, and looks like this:
- Submit to the tax service at your location a registration statement for 30 days about the beginning of the reporting (tax) quarter.
- Along with the registration statement, financial statements are submitted, copies of the necessary primary documents.
- To confirm the right to use taxation peculiarities, the state tax service authority has the right to conduct a documentary unscheduled non-field inspection of the payer to determine the accuracy of the documents submitted by the taxpayer.
- In the positive case, the answer is issued within 15 days from the date of application.