Submissions
CFC
notification

If you have recently registered a company or are just planning to, remember about the CFC notification because after registering a company, you have the following obligations:

Starting from January 1, 2022, owners of foreign companies are obliged to submit a Notification on the acquisition (beginning of actual control) or alienation of a share (termination of absolute control) by a resident in a foreign legal entity or property rights to a share in the assets, income or profit of an entity without the status of a legal entity.

When to file a CFC notification

The deadline for submitting the notification is 60 days from the date of: acquisition (beginning of actual control) or alienation of a share (termination of absolute control) in a foreign legal entity, property rights to a share in the assets, income, or profits of an entity without the status of a legal entity; beginning/termination of actual control over a foreign legal entity.

Penalties for failure to notify the CFC

Fines for failure to notify the CFC within 60 calendar days currently amount to 300 times the subsistence minimum:

• For the reporting year 2022 – 300 PM * UAH 2,481. = UAH 744,300.
• For the reporting year 2023 – 300 PM * 2 684 = 805 200 UAH.

Draft Law No. 8137 proposes to reduce the penalties for such a violation from 300 PM to 50 PM – for the reporting year 2023 – 50*2 684 UAH. = UAH 134,200. A penalty for late submission of the CFC Notification is introduced, which will be 1 PM for each day of delay, but not more than 25 sizes of the subsistence minimum (2684 * 25 = UAH 67100).

Therefore, we recommend submitting a CFC notification in time or contacting a specialist.

Who must submit a CFC notification?

Residents of Ukraine (individuals or legal entities) at the place of tax registration must notify the supervisory authority in the specified form.

According to Article 39-2.1.2. of the TCU, a controlling person is an individual resident of Ukraine or a legal entity resident of Ukraine that:

• owns a share in a foreign legal entity in the amount of more than 50 percent or
• owns a share in a foreign legal entity in the amount of more than 10 percent, provided that several individuals – residents of Ukraine and/or legal entities – residents of Ukraine own shares in a foreign legal entity, the amount of which in aggregate is 50 percent or more, or
• individually or together with other residents of Ukraine who are related parties, exercise actual control over a foreign legal entity.

Who does not submit a CFC notification?

If you have registered a sole proprietorship in Europe, you do not need to file a CFC notification because you have the status of a sole proprietor, which does not qualify as a CFC. However, do not forget about double taxation and consult a tax specialist on time 🙂.

Submitting a CFC notification with Finevolution

Our team can help with the timely submission of the CFC notification. All you need is an electronic signature or a valid Deed of Action – we will do the rest. The turnaround time is one business day (subject to availability of documents). 

What is included in the service:

• Express consultation and validation of your request
• Preparation of a draft form for filing a CFC notification
• Submission of the form online by our lawyers
• Answers to your questions regarding the submission of the notification

Also 2024, we will be happy to help CFC owners (registered in 2022-2023) prepare and submit the CFC report.

To order the “CFC Reporting” service, please leave a request through the form below Viber, Telegram, WhatsApp, to get a detailed consultation on Controlled Foreign Companies (CFC) in Ukraine.