Quarantine: tax implications for business in Ukraine


On March 18, 2020, President Zelensky signed a package of laws regarding support of taxpayers and individuals during national quarantine (Laws No. 3220, 3219, 2538, 2539). What tax-related novelties do these laws introduce for business? See below the summary from INTEGRITES Tax and Customs team.

Tax holidays – March 1 to April 30, 2020

No accrual and payment of land tax for land owned or in use of individuals and legal entities and used in business operations;
Non-residential property owned by individuals or legal entities will not be subject to real estate tax;
Unified social contribution (USC) is not accrued and paid by private entrepreneurs, farming households and self-employed persons (medical, legal, scientific practitioners, etc.).


Until January 1, 2023, no value-added tax (VAT) is charged on import of medicine, medical devices and other goods required for the implementation of centralized health programs and purchased by a special authorized body.

Similarly, until January 1, 2023, no VAT is charged on free supplies of mentioned medicines, medical devices and medical services to patients.

Personal income tax

The period of filing tax return is extended to July 1, 2020, and the personal income tax shall be paid till October 1, 2020.

Tax audits

Documentary and on-sight tax audits are banned from March 18, 2020 to May 31, 2020.

The schedule of the planned audits will be updated and published by March 30, 2020, and pending audits will be suspended until May 31, 2020.

The audits` ban does not apply to documentary unscheduled audits in case the company claims VAT refund which exceeds UAH 100,000.

Similar rules will also apply to tax audits related to the USC:

  • documentary audits are banned from March 18, 2020 to May 18, 2020
  • ongoing audits are suspended until May 18, 2020.

At the same time, “quarantine” legislation does not address desk tax audits. The fines and penalties for VAT-related violations, excise duty and rent payment have not been abolished for the quarantine period, so it can be expected that the desk tax audits will be carried out in a due course.



From March 18, 2020 to May 31, 2020, the statute of limitations for determination of tax obligations by tax authorities is suspended.

It means that in calculation of 1095 days (general statute of limitations) or 2555 days (applicable to transfer pricing), 75 days of that period will not count. Such a change will affect the calculation of statute of limitations in the long-term prospective.


Penalties and fines

No fines will be imposed for tax violations committed from March to May 2020.

Late registration of VAT and excise invoices: it can be assumed that the fine for late registration of VAT and excise invoice from March 1 to May 31, 2020 will not apply. However, official clarifications from the tax authorities on this issue are still expected.

During quarantine fines will still apply to violations related to:

  • Alienation of tax lien property;
  • Rules on the circulation of fuel or ethanol in excise warehouses;
  • Accrual, declaration and payment of VAT, excise and rent payment.

In addition, during March-May 2020 the penalty will not apply and is subject to deduction if accrued.

The same applies to USC. During March-April 2020 no fines apply for late payment or underpayment of USC, as well as for violation of reporting requirements. The penalty is not applicable as well.



Release from payment of fines and penalties

(1) applies for the periods specified above (e.g., non-payment of USC for February which is due in March will not be covered by the said release);

(2) does not exclude payment of taxes and USC.