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In its letter No. 17802/7/99-99-19-03-02-17 dated 12.09.2013, the Ministry of Revenues and Duties of Ukraine clarifies issues related to the amendments introduced by the Law of Ukraine
If profit tax is paid when dividends are distributed, the taxpayer may be exempt from advance payments
In its letter No. 17802/7/99-99-19-03-02-17 dated 12.09.2013, the Ministry of Revenues and Duties of Ukraine clarifies issues related to the amendments introduced by the Law of Ukraine “On Amendments to the Tax Code of Ukraine and other Laws of Ukraine concerning real estate” No. 403-VII dated 04.07.2013.
A taxpayer is allowed to reduce the amount of advance payments for profit tax by the amount of advance payments for profit tax paid upon the distribution of dividends, in accordance with clause 153.3 of Article 153 of the Tax Code of Ukraine.
In cases when the amount of advance payments for profit tax on dividend payments exceeds the amount of advance payments for profit tax, in accordance with clause 153.3 of Article 153 of the Tax Code of Ukraine, the excess amount must be credited toward the reduction of subsequent payments in reporting months.
Considering the fact that, according to the Tax Code of Ukraine, the calculation of the amount of advance payments is made based on the tax declaration for the previous year, payers of advance profit tax payments when distributing dividends can take into account a decrease in contributions based on the results of the 2013 declaration. Thus, advance profit tax payments paid upon the distribution of dividends but not taken into account when paying advance payments may be considered for reduction when calculating tax liabilities based on the 2013 annual declaration.
Accordingly, monthly advance payments from March 2014 to February 2015 will be calculated as one twelfth of the profit tax paid for 2013, reduced by the amount of advance profit tax payments paid upon the distribution of dividends during the past year.