by Leonid Karpov, Partner, AC Crowe, Ukraine
Ukrainian companies that purchase or sell goods using certain foreign intermediaries must identify all the companies in the chain of these deliveries and these companies’ functions, assets, and risks to so the government can assess the controlled transaction, the State Fiscal Service of Ukraine has said in recent transfer pricing guidance.
The guidance, official letter № 513/6/99-99-15-02-02-15, issued February 13, clarifies how to apply paragraph 39.2.1.5 of the Tax Code of Ukraine after new transfer pricing amendments became effective on January 1, 2019.
The January 1 amendments stipulate that if there is a chain of transactions between a Ukrainian company and a foreign one that involves an associated company, or a company from a country on Ukraine’s “offshore” list, or firm that has a legal form described in the Ukrainian blacklist (such as a British LP or LLP or a New York, California, or Florida LLC), and within this chain are the other companies that do not perform the key functions, use material assets, or assume important risks, the transaction of the Ukrainian company is considered controlled for transfer pricing purposes.
– Leonid Karpov is a Partner with AC Crowe, Ukraine.
Be the first to comment