Global and local drivers of transformation


Global and local drivers of transformation

Be it direct or indirect impact of the drivers, they will still have an effect on your business. Determine the drivers affecting your business the most

Transformational changes are no longer viewed as an additional option for the companies that strive to achieve more. Global and local trends that drive us toward new, transparent, and globalized world force Ukrainian companies to adapt to changing business environment. An array of critical challenges that have an irrepressible and direct impact on business calls for transformational changes

Global and local drivers of transformation


Global drivers Global trend  Local trend  Effect on business
BEPS Action Plan implementation


Stricter "rules of the game", income is taxed at source, gradual improvement of tax transparency
Tackling treaty shopping Application of preferential rates under the Conventions will become more difficult; occurrence of Substance related costs
Taxation of controlled foreign companies (CFC) Accrual of additional tax liabilities in the CFC beneficiary's country of residence 
Limiting deduction of interest on loans Limited tax optimization through loans
Fighting harmful tax practices (IP Box regimes, holding regimes, etc.) Abolishing privileges, limiting the use of privileges
Combating artificial avoidance of the permanent establishment status Origination of the permanent establishment (PE) status, taxation of PE income
Transfer pricing documents and country-by-country reporting Increase in document preparation expenses, preparation of new format reports, accrual of additional tax liabilities 
Multilateral Convention to Implement Tax Treaty Related Measures to Prevent BEPS (MLI) Inappropriateness of using shell companies, difficulties in applying preferential rates under the Convention, additional Substance related costs, strict rules for permanent establishment
Anti-Money Laundering (AML) – disclosure of ultimate beneficiary Information about ultimate beneficiary will be publicly available
Exchange of information under CRS Increased awareness of tax authorities, accrual of additional tax liabilities
Bank policy tightening, enhanced compliance procedures Difficulties with opening an account, risk of unexpected account closure, blocking of funds
Currency regulation   Extension of currency restrictions until full stabilization of the banking system's financial standing
Exit capital tax    Switching to a new income taxation procedure



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