Wrongful tax accruals and penalties runs up bill of UAH 387 752 514

Tax issues: Inspections by state tax and fiscal agencies Dnipropetrovs'k region

Complainee: State Fiscal Service of Ukraine (SFS), Dniprovskiy District State Tax Inspection, Kyiv
Complaint in Brief: In February 2016, the BOC received a complaint from an automotive company related to a tax audit conducted in 2015. The Complainant claimed this had resulted in the illegitimate accrual of additional taxes and penalties. The additional tax accrued along with penalties amounted to around UAH 380 million. Disagreeing with the tax audit results, the Complainant first filed a challenge with the local tax authorities, without result. The company next filed an appeal with the State Fiscal Service of Ukraine and asked the BOC for assistance in withdrawing the tax accruals and penalties.
Actions taken: The BOC’s investigation revealed that there were insufficient grounds to justify the heavy tax bill and recommended to the State Fiscal Service to reconsider them. The BOC, together with company officials, also participated in a hearing of the administrative appeal with the SFS.
Result achieved: In April 2016, the BOC received a letter from the SFS confirming that the administrative complaint was justified and the original tax rulings were revoked. The direct financial impact amounted to UAH 387,752,514. The case was prepared to be closed.

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