Main cases of submitting tax declaration. Examples of obligation to submit tax declaration or exemption from submission

Main cases of submitting property and income tax declaration

According to provisions of Section IV of the Tax Code of Ukraine (hereinafter – Code), taxpayers are required to submit property and income tax declaration (hereinafter – tax declaration) upon the receipt of:

certain types of income that are not subject to taxation upon payment, but are not exempted from taxation (Sub-paragraph 168.1.3 Paragraph 168.1 Article 168 of the Code);

income from individual who is not tax agent (from other individuals (residents or non-residents)) (Sub-paragraph 168.2.1 Paragraph 168.2 Article 168 of the Code);

foreign income (Sub-paragraph 170.11.1 Paragraph 170.11 Article 170 of the Code).

from entrepreneurial activities, except for individuals who chose simplified taxation system (Article 177 of the Code);

from independent professional activity (Article 178 of the Code).

and in other cases provided for by the Code;

Declarations must also be submitted by:

foreigners who, based on results of the reporting year, acquired status of a resident of Ukraine, who must reflect income with source of their origin in Ukraine in tax declaration and foreign income (Sub-paragraph 170.10.4 Paragraph 170.10 Article 170 of the Code);

taxpayers – residents who move abroad to a permanent residence place not later than 60 calendar days prior to departure (Paragraph 179.3 Article 179 of the Code).

At the same time, citizens who are entitled to tax discount submit tax declaration.

Herewith, according to with Paragraph 179.2 Article 179 of the Code, submission of tax declaration is considered fulfilled and tax declaration is not submitted, if the taxpayer received:

income, including foreign income, which, according to the Code, is not included in the total monthly (annual) taxable income;

income exclusively from tax agents, regardless of the type and amount of accrued (paid, provided) income;

income from sale (exchange) of property, donations, income from which according to the Code is not taxed, is taxed at a zero rate and/or from which, upon notarization of contracts, tax was paid according to this section;

income in the form of heritage objects, which, according to this section, are taxed at a zero tax rate and/or from which tax has been paid according to Paragraph174.3 Article 174 of the Code.

Also, tax declaration is not submitted in cases directly provided for by the Code.

If the taxpayer is required to submit tax declaration according to other provisions of the Code, it shall include, along with other income, incomes provided for in Paragraph 179.2 Article 179 of the Code.

In addition, taxpayers have a right to submit tax declaration in order to use right to tax discount.

Examples of obligation to submit tax declaration or exemption from submission

Example 1 (inheritance for which personal income tax (hereinafter – tax) and military levy have not been paid)

Taxpayer received certificate of right to inherit real estate from the testator, his maternal aunt on March 25, 2023. Tax and military levy were not paid during the notarization of inheritance. Is it necessary to submit declaration?

Answer: Sub-paragraph 174.2.2 Paragraph 174.2 Article 174 of the Code stipulates that inheritance objects inherited by heirs who are not family members of the first and second degrees of kinship are subject to taxation.

Taxpayer who receives income from individual who is not tax agent is obliged to include amount of such income in the total annual taxable income and submit tax declaration based on results of the reporting tax year, as well as pay tax on such income (Sub-paragraph 168.2 1 Paragraph 168.2 Article 168 of the Code).

Therefore, in this case, the taxpayer must submit tax declaration for consequences of 2023.

For reference!!! Sub-paragraph 14.1.263 Paragraph 14.1 Article 14 of the Code stipulates that family of the of individual of the first degree of kinship for purposes of Section IV of this Code are considered to be parents, husband or wife, children of such individual, including adopted children.

For purposes of Section IV of this Code, family members of individual of second degree of kinship are brothers and sisters, maternal and paternal grandparents, grandchildren.

Example 2 (inheritance received from family member of the first and second degree of kinship)

Taxpayer inherited movable property from the testator – father in 2023. Is it necessary to submit declaration?

Answer: Paragraph 179.2 Article 179 of the Code stipulates that tax payer's obligation to submit tax declaration is considered fulfilled and tax declaration is not submitted, in case of receiving income in the form of inheritance objects, which, according to Section IV of the Code, are taxed at zero tax rate and/or from which tax has been paid according to Paragraph 174.3 Article 174 of this Code.

Inheritance objects inherited by heirs who are family members of the first and second degree of kinship of testator are subject to taxation at zero rate (Sub-paragraph 174.2.1 Paragraph 174.2 Article 174 of the Code).

As follows in this case, the taxpayer is exempted from submitting declaration according to consequences of 2023, provided that there are no other incomes that imply emergence of obligation to submit it.

Example 3 (sale of one car during the year)

Taxpayer sold one car in 2023. Is it necessary to submit declaration?

Answer: Paragraph 179.2 Article 179 of the Code stipulates that tax payer's obligation to submit tax declaration is considered fulfilled and tax declaration is not submitted, in case of receipt of income from sale (exchange) of property, donations, income from which according to the Code is not taxed, is taxed at zero rate and/or with which upon notarization of contracts for which tax was paid according to Section IV of the Code.

Paragraph 173.2 Article 173 of the Code provides that income received by the taxpayer from sale (exchange) during the reporting (tax) year of one of objects of movable property in the form of a passenger car and/or motorcycle and/or moped is not subject to taxation.

As follows in this case, the taxpayer is exempted from submitting declaration according to consequences of 2023, provided that there are no other incomes that imply emergence of obligation to submit it.

Example 4 (sale of truck)

Taxpayer sold a truck to another individual in2023. Contract was compiled at service center of the Ministry of Internal Affairs. Payment of tax and military levy was made when the car was sold. Is it necessary to submit declaration?

Answer: Paragraph 173.1 Article 173 of the Code stipulates that taxpayer's income from the sale (exchange) of movable property during the reporting tax year is subject to taxation.

Taxpayer is obliged to submit annual property and income declaration (tax declaration) according to this Code.

Taxpayer who receives income from individual who is not tax agent is obliged to include amount of such income in the total annual taxable income and submit tax declaration based on results of the reporting tax year, as well as pay tax on such income (Sub-paragraph 168.2.1 Paragraph 168.2 Article 168 of the Code).

Since the specified case does not fall under cases established by Paragraph 179.2 Article 179 of the Code, since the tax and military levy were not paid during the notarization of contracts, in this case the taxpayer must submit tax declaration according to consequences of 2023.

Example 5 (apartment for rent to another individual)

Taxpayer rented out own apartment to another individual during 2023. Is it necessary to submit declaration?

Answer: Sub-paragraph 170.1.5 Paragraph 170.1 Article 170 of the Code stipulates that if the lessee is individual who is not self-employed, individual responsible for calculating and paying (transferring) tax to the budget is the taxpayer – lessor.

Taxpayer who receives income from individual who is not tax agent is obliged to include amount of such income in the total annual taxable income and submit tax declaration based on results of the reporting tax year, as well as pay tax on such income (Sub-paragraph 168.2 1 Paragraph 168.2 Article 168 of the Code).

As follows in this case, the taxpayer must submit tax declaration according to consequences of 2023.

Example 6 (alienation of corporate rights)

Taxpayer transferred company's corporate rights to another individual in 2023. Is it necessary to submit declaration?

Answer: Sub- paragraph 170.2.1 Paragraph 170.2 Article 170 of the Code stipulates that accounting of the total financial result of operations with investment assets is carried out by the taxpayer independently, separately from other income and expenses. For taxation purposes of investment income, reporting period is considered to be a calendar year following results of which the taxpayer is required to submit annual tax declaration, in which the total financial result (investment profit or investment loss) received during such reporting year must be reflected.  

As follows in this case, the taxpayer must submit tax declaration according to consequences of 2023.

Example 7 (foreign income)

Taxpayer worked abroad and received salary there during January – March 2023. Is it necessary to submit declaration?

Answer: Sub- paragraph 170.11.1 Paragraph 170.11 Article 170 of the Code stipulates that if the source of payments of any taxable income is foreign, amount of such income is included in the total annual taxable income of the taxpayer – recipient, who is required to submit annual tax declaration.

As follows in this case, the taxpayer must submit tax declaration according to consequences of 2023.