How do you describe the current business environment in the country? Are any new tax rate or legislation changes influencing it? If so, how?
After long time and numerous discussions over several versions of the Ukrainian tax reform, a number of amendments to the Ukrainian tax laws entered into force in January 2016. The adopted legislation has not radically changed the basic tax rules, however it has brought some clarity on labour force taxation.
What are the biggest benefits for companies to enter the market in 2016?
One of changes is the Social Security Insurance in the Tax Reform, previously there were 67 different categories (professional risk) of SSI from 36,76% to 49,50%. This made labour costs for employer quite high. Currently, Ukraine seems to be quite low in regards to the labour costs compared to the rest of Europe. Also, January 1, 2016 saw the launch of a free trade zone between Ukraine and the EU. During the first week, the free trade zone with the European Union Ukrainian Customs have issued about 1 thousand Certificates EUR.1 for duty-free export of Ukrainian goods to the European Union. At the end of last year the Verkhovna Rada passed the Law of Ukraine “On Measures for Stimulating Foreign Economic Activity", which canceled additional import surcharge applicable at 5% and 10% rates of the goods’ customs value. So in general, we've seen quite many changes as the country is slowly but surely becoming a reliable business partner to EU partners and other counties.
Since 1 January this year, an individual taxpayer is no longer required to file a separate annual tax return on income received from salary and payments from Civil Contracts from two or more sources and if the revenue exceeds 120 times minimum wage in the reporting year.
What are the key goals for Leinonen in the market in 2016?
Moving to the Ukrainian market takes time and requires a trusted and committed partner. However, Ukrainian bureaucracy can be easily handled by working with experienced professionals familiar with the local administration and legislation. Leinonen is present in the capital city, Kiev, and is ready to help international companies to enter and succeed in Ukraine. We provide range of services starting from opening a company or representative office in the area, handling accounting, taxation and payroll issues as well as providing HR support if required. Our new goal is to open advisory unit where we can support companies with our high level specialists solving challenging issues for the benefit of our customers. And of course, last but not least, as Transfer Pricing is becoming a key topic, to provide, with cooperation with our partner, Transfer Pricing Service to our customers.
We will send you articles keeping you up to date with the latest trends and developments in accounting, taxation or legal fields.