Scheduled tax audits in 2023

At the end of 2022, despite the current ban on conducting scheduled documentary audits, the State Tax Service of Ukraine traditionally published the 2023 Audit Plan.

According to the Plan, tax audits will mostly start in March.

As of the date of this Alert, the moratorium on certain types of documentary audits provided for by the Tax Code of Ukraine (TCU) is still in effect. However, its lifting is being discussed at the Verkhovna Rada.

This refers to Draft Law 8401 dated 31 January 2023 “On Amendments to the Tax Code of Ukraine and other laws of Ukraine regarding the peculiarities of taxation during martial law”. Draft Law 8401, inter alia, allows all types of tax audits and renews the tax terms after martial law and national emergency in Ukraine are lifted, but not later than 01 July 2023.

Thus, if these legislative changes are adopted in the middle of the year, the ban on conducting audits will be lifted, and the Audit Plan will take effect.

Since the limitation periods provided for by the TCU were suspended during the “covid” moratorium and martial law, the upcoming scheduled audits may cover tax periods starting from 2017. Tax authorities may request large volumes of documents from taxpayers. Clarity of cooperation with inspectors, completeness and quality of the provided documents and explanations may influence the audit results.

To properly prepare for a tax inspectors’ visit, we recommend you:

• checking in advance whether your company is included in the Audit Plan;
• checking whether all required documents are in place and whether you can promptly provide them during the audit;
• assessing all risk areas that may result in additional accruals of tax liabilities and, if necessary, prepare your defensive position;
• conducting a training session for employees on how to behave during the audit.

If you have any questions regarding the information contained in this Alert, please do not hesitate to contact our attorneys-at-law and Tax & Legal professionals.

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