What should I do if my bank account is seized?

Any entrepreneur may face a bank account seizure if they have a tax debt or a court decision has entered into force. Read this article to find out what to do if such a trouble happens to you.

Who can freeze a bank account and for what reason?

They can seize a bank account:

• private contractor;
• state enforcement officer;
• the tax service by court order.

The Enforcement Service can seize property to enforce court decisions or on the basis of documents with enforcement power.

The tax authorities can seize your account if you have a tax debt and no property to pay it off. Moreover, the amount of seized funds in your account should not exceed the amount of the debt.

Certain accounts are not subject to seizure, including: single tax accounts, VAT SEA accounts.

What should I do if my accounts are frozen?

If your accounts have been frozen, you must comply with the terms of the freeze and try to lift the freeze. Let's take a closer look at each step.

Step 1. Fulfill the conditions of the arrest.

If the accounts were seized due to debts to a counterparty, you can:

• transfer the debt with the consent of the creditor;
• ask the counterparty to defer the fulfillment of the obligation;
• pay in cash.

If the accounts were seized due to a tax debt, you can:

• ask or instruct someone to pay the tax debt on your behalf. You can't do this to pay a USC or VAT debt;
• pay the debt in cash.

If the accounts were seized due to debts to employees, you can:

• remove the seizure of the amount required to pay salaries and pay it to employees. To do this, you need to write a letter to the executive service and attach documents confirming the amount required to pay the salary;
• pay salaries in cash.

Step 2. Release the arrest.

There are two ways to remove a bank account freeze:

1. Eliminate the reason for the arrest. Everything is simple here: if you have debts, you need to pay them and the arrest will be lifted. However, the procedure for lifting the arrest is not a quick process, since after the debt is paid off, the tax authorities must go to court and the court can lift the arrest by its decision.
2. Appeal against the decision to impose an arrest in court.

If your accounts have been frozen, it is better not to open new accounts, as the tax authorities may consider it a criminal offense.