KPMG Law Ukraine represented a large manufacturer of cosmetics and hygiene products
KPMG Law Ukraine represented a subsidiary of a large manufacturer of cosmetics and hygiene products in a tax dispute regarding penalties assessed due to an error in account details made in the process of income tax payment.
At the stage of administrative appeal, tax dispute resolution experts of KPMG Law Ukraine could prove that transfer of income tax to a wrong account did not affect company's settlements with the budget and therefore could not be considered a failure to meet tax payment deadlines based on Article 126, the Tax Code of Ukraine.
Upon consideration of the complaint, the State Tax Service of Ukraine took into account the Supreme Court’s practice and confirmed that a taxpayer can be fined under Article 126, the Tax Code of Ukraine, specifically for failure to pay the agreed amount under relevant obligation, however, an error made in tax amount transfer should be qualified as an action (payment), although erroneous. Therefore, the State Tax Service of Ukraine cancelled the appealed tax notice-decision as unlawful.
The engagement was led by Kostiantyn Karpushyn, partner, and performed by Larysa Antoshchuk, attorney, and Iryna Khyliak and Yana Bazia, KPMG Law Ukraine’s experts.