Ukraine: local rules

Transfer pricing is in article 39 of the Tax Code of Ukraine (TCU). Controlled transactions must be priced at arm's length, and the tax authority can adjust the taxable result when they are not. A transaction is controlled when it can affect the corporate income tax base and is with a related non-resident, a non-resident in a listed low-tax jurisdiction, a non-resident of a listed legal form, through a non-resident commission agent, or between a non-resident and its Ukrainian permanent establishment. It is only controlled if the taxpayer's yearly revenue is above UAH 150m and the total with that counterparty in the year is above UAH 10m, both net of indirect taxes (TCU 39.2.1.7; for a permanent establishment only the UAH 10m test applies). The low-tax list was replaced by Cabinet Resolution No. 1505 of 27 December 2024. A draft law (No. 16035) would rewrite the rules in line with the 2022 OECD Guidelines, but it is not law.

Taxpayers with controlled transactions file a Report on Controlled Transactions before 1 October of the year after the reporting year, so 30 September is the last day (TCU 39.4.2). Members of a multinational group (MNE group) that had controlled transactions also file a notification of participation in the group by the same date. Local file documentation must be prepared and kept for each year (TCU 39.4.3) and handed over within 30 calendar days of a tax authority request, which can be sent from 1 October of the following year. A master file can be asked for only where the group's consolidated income for the prior financial year is at least EUR 50m, and must be handed over within 90 calendar days of a request. A country-by-country (CbC) report (group revenue EUR 750m or more) is filed by a Ukrainian parent or appointed entity, or by a Ukrainian group member in certain cases (for example when the parent's country does not exchange CbC reports with Ukraine), within 12 months after the group's financial year end (TCU 39.4.10).

The TCU lists five methods: comparable uncontrolled price, resale price, cost plus, net profit (TNMM) and profit split (TCU 39.3.1). The most suitable method for the facts is used, and a range of comparables is used when there are several. Large taxpayers can apply for an advance pricing agreement (TCU 39.6). Taxpayers can notify the STS of the contract terms so that the contract date fixes the price comparison date.

Penalties are in TCU article 120 and are set in multiples of the subsistence minimum for an able-bodied person on 1 January of the year. Not filing: controlled transactions report 300, master file 300, CbC report 1,000, group participation notification 100; missing local file 3% of the undocumented transactions, up to 200. Filing late: report 1 per day up to 300; local file 2 per day up to 200; master file 3 per day up to 300; CbC report 10 per day up to 1,000; notification 1 per day up to 50. Leaving transactions out of the report is 1% of their value, up to 300. Wrong data in the notification is 50, and in the CbC report 200. Understated tax from a transfer pricing adjustment also carries the usual understatement penalties.

Ukraine has not enacted Pillar Two. No law on an income inclusion rule, qualified domestic top-up tax or undertaxed profits rule was found, and there is no Ukrainian GloBE filing or deadline. The 2024 to 2030 National Revenue Strategy lists Pillar Two as a priority, so a law may come later. Ukrainian subsidiaries of in-scope groups can still be reached by foreign rules.

The tax year is the calendar year. The annual corporate income tax return, with the financial statements, is due within 60 calendar days after year end (TCU 49.18.6), so 1 March, or 2 March in 2026 because 1 March was a Sunday. Tax on it is due within 10 calendar days after the filing deadline (TCU 57.1); the STS counts this from 1 March, so 11 March 2026. Some taxpayers also file quarterly returns within 40 days of each quarter. A filing or payment deadline that falls on a weekend or holiday moves to the next working day (TCU 49.20 and 57.1). Martial law has been in force since 24 February 2022 and was last extended to 31 October 2026. While it lasts, public holidays are working days, so in practice only weekends move a deadline. Martial law penalty relief is limited to taxpayers who really could not meet a deadline and is not a general extension. The corporate rate is 18%.