The Methodological Bases of Forming a Report in the Context of Countries in Terms of Implementation of Requirements of the BEPS Action Plan in Ukraine

• Main Authors: Krutova Angelika S., Nesterenko Oksana O.
• Format: Article
• Language: English
• Published: Research Centre of Industrial Problems of Development of NAS of Ukraine 2019-09-01
• Series: Bìznes Inform
• Subjects: international tax regulation; beps action plan; controlled operations; «extended hand» principle; transfer pricing; country-by-country reporting
• Online Access: https://www.business-inform.net/export_pdf/business-inform-2019-9_0-pages-210_217.pdf

The article is aimed at developing the conceptual bases for the formation of official reporting on transfer pricing, in particular the country-by-country reporting. It is substantiated that the country’s recognition of the generally accepted standards of countering the aggressive tax planning requires a significant adaptation of the legal field. Adaptation paths are presented, including the approximation of the provisions of national legislation with the provisions of the European Union legislation to create the proper conditions for implementation of the BEPS Action Plan in the Ukrainian legislative field. The requirements of the main documents are defined and described (the Law of Ukraine «On Currency and Currency Operations», the Multilateral convention on the implementation of measures concerning the taxation agreements to counteract the erosion of the base and the removal of profits from taxation, the Draft Law of Ukraine «On amending the Tax Code of Ukraine in order to implement the Plan to counteract the erosion of the tax base and the removal of profits from taxation»), which determine and explain methodology, order, procedures and features of disclosure by groups of enterprises of information on income distribution, economic activity and the taxes paid in different countries, in the context of introduction of the country-by-country reporting. In order to facilitate the rapid and even implementation of the country-by-country reporting, its conceptual characterization is provided, which defines the subject of the report’s submission, discloses the period of application and the timing of its submission, describes the information, that should be disclosed in the report, and the amount of penalties in the event of non-representation. It is proved that in order to implement the BEPS Action Plan in Ukraine, the regulatory documents need to define the concept of the country-by-country reporting, to disclose the principles of formation of the consolidated information as to the group’s activities on the global distribution of income, the taxes paid, as well as certain indicators of economic activity in the context of all jurisdictions in which the group operates; identify the methodological bases for accounting for expenditures, incomes, assets and income tax liabilities together with disclosure of this information in the country-by-country report.