CFC rules are in force. The CFC Notification filing requirement already applies

We remind you that the rules for taxing the profits of controlled foreign companies (CFC) came into force on 1 January 2022. Persons (individuals or legal entities) controlling CFCs are obliged to submit notifications to the tax authorities in case of an acquisition / alienation of a share in a CFC – legal entities or establishment / liquidation or acquisition / alienation of property rights to a share in assets, income or profit of a non-legal establishment (e.g., trust, private fund, etc.); commencement / termination of actual control over the CFC (Notification). These requirements do not apply only if the CFC is a public company.

The notification, separately for each CFC, shall be filed with the State Tax Service in electronic form within 60 days from the date of such acquisition (commencement of actual control) or alienation (termination of actual control). That is, if any of the above changes occurred, for example, on 1 January 2022, the CFC Notification must be filed by 2 March 2022 inclusive. The Ministry of Finance has already approved the form and procedure for filing the Notification, you can find it at the link .

Attention! There are penalties for non-submission of the Notification – in 2022 the fine is UAH 744,300 for each (!) fact of non-submission. But until the end of quarantine, i.e., until 31 March 2022 or later, in case the quarantine is extended by the Cabinet of Ministers of Ukraine, penalties for violations of tax legislation are not applied.

Important! The Notification must be filed by electronic means in electronic form in compliance with the requirements of the legislation on electronic document management. In order to submit the Notification in electronic form through the Electronic Cabinet, we advise you to obtain in advance a qualified electronic signature (QES) from the Qualified Provider of Electronic Trust Services of the Information and Reference Department of the State Tax Service of Ukraine or another provider of electronic trust services (from the list), for example, through the resource "DIIA", JSC CB "PRIVATBANK", JSC "State Savings Bank of Ukraine" or JSC "UKRSIBBANK".

If you have questions about CFC reporting, CFC profits taxation, personal assets planning, income declaration, participation at the amnesty campaigns or any other related issues, please contact PwC experts who will be happy to provide you with advice and technical support.