Tax expenses in the payment of royalties in favor of a non-resident

Tax consulting
  • the leading Ukrainian brewing company, the representative of the world group in Ukraine
  • low-alcohol production and distribution
  • about 3,000 employees

The chief accountant of the client contacted us with the following question. Based on the result of the tax audit, the client was charged with penalties for the operations of including royalties in favor of non-residents (European companies) in the tax expenses. The total amount of fines was more than 65 million euro. The task for the tax consultant was to assess the appropriateness of calculating penalties and, if necessary, prepare documents and letters that would defend the client’s position.

As a result of the consideration of claims by the tax authorities, we came to the conclusion that they were not substantiated. We drafted and submitted complaints against the decision of the supervisory authority, as well as participated in meetings with representatives of the tax service, whose goal was to convince them to accept the client’s position.

Result

The tax service accepted the client’s position and recognized the tax expenses.

If you have a similar situation, write to us to resolve the issue