If you have recently registered a company or are just planning to do so, it is important to understand the requirements for tax reporting. After registering a foreign company, you need to submit a notification to the State Tax Service in a timely manner.
Starting from January 1, 2022, the owners of foreign companies are obliged to notify the tax authorities of the acquisition or disposal of a share by a resident of Ukraine in a controlled foreign company. This also applies to property rights to a share in the assets, income or profits of an entity without legal entity status.
In 2025, this obligation remains relevant, and fines may increase significantly. Timely consultation with the CFC will help to avoid risks and optimize tax liabilities.
When to submit a notification to the CFC?
The deadline is 60 days from the date of
- acquisition or alienation of a share in a controlled foreign company
- commencement or termination of actual control over the company
Who submits a notification to the CFC?
According to Art. 39-2.1.2. of the Tax Code of Ukraine, a controlling person is an individual resident of Ukraine or a legal entity resident of Ukraine who:
- owns a share in a foreign company in the amount of more than 50 percent, or
- owns a share in a foreign company 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 – related parties exercise actual control over a foreign legal entity
If you have registered a sole proprietorship in Europe, you do not need to submit a notification, as a sole proprietorship does not fall under the definition of a controlled company.
However, it is important for European sole proprietors to take into account possible double taxation risks. Timely tax advice will help avoid financial losses and fines.
