Penalty for failure to respond to a tax request

24.05.2023 16:58

штрафи за ненадання інформації чи документів на запит податкової

Starting from 28.04.2023, the Tax Code was supplemented with a provision that provides for fines for entrepreneurs and individuals for failure to respond to a tax request. This innovation is related to the introduction of provisions on automatic exchange of information.

What are the fines for failure to provide information to the tax authorities?

If a taxpayer (legal entity, individual entrepreneur or individual) fails to submit or fails to submit documents or other important information in full at the request of a supervisory authority, a fine will be imposed on it:

5 times the minimum wage (UAH 33,500) for each such violation, if the request is related to the automatic exchange of information,
1 minimum wage (UAH 6,700) for each such fact in all other cases.

Now, if the tax authority has sent a request for explanations or documents to the taxpayer, but the taxpayer has not received it, or has received it but has not provided a response, such situations are grounds for imposing a fine.

Will there be a fine if the response is provided but not in time?

Clause 121.2 of the TCU refers only to the failure to provide and incomplete provision of information to the State Tax Service. Therefore, if the response is provided late, no penalty is theoretically foreseen. However, it is not clear how the tax authorities will act in practice.

A fine may also be imposed for "incomplete submission", even if the response is submitted on time, but the tax authorities decide that it is "incomplete". The tax authorities will assess the completeness of the documents at their own discretion.

This does not mean that a response must be provided in any case. If the request is drawn up in violation of the requirements set out in subpara. 1-5 of subpara. 73.3 of Article 73 of the Tax Code, the taxpayer is exempt from the obligation to respond to such a request.

However, if the tax request does not comply with the requirements of the Tax Code (which is 90% of all requests), it is mandatory to provide a response to it, stating this discrepancy.

Will there be a fine if I provide such a response?

If the request does not comply with the requirements of the Tax Code, the tax authorities have no right to receive information and documents and, accordingly, no grounds for imposing a fine for failure to provide them.

At the same time, the unlawful application of fines under para. 121.2 of the TCU cannot be ruled out in any case in case of providing a response to a tax request that does not comply with the requirements of the TCU.

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