Ukraine: CFC Owners to Get Ready: The Deadline for Reporting is Coming

Published on Jan 22, 2024

Why is it important now?

The upcoming deadlines for filing the report are:

  • For individuals – 1 May 2024;
  • For CPT taxpayers – 1 March 2024.

What needs to be done before the deadline?

  • To determine whether you are a controller of a foreign company (the “CFC”);
  • To ensure timely preparation of the CFC’s financial statements;
  • Calculate and determine whether you need to pay taxes in Ukraine;
  • Fill in and file the report.

Who will be affected?

The CFC report must be submitted by those persons (or entities) who directly or indirectly own foreign companies (or owned it as of the end of 2022 if the 2022 report still needs to be submitted).

A tax resident of Ukraine will be recognised as the CFC controller if he:

  • owns more than 50 per cent of shares in a foreign company,
  • owns more than 25 per cent of shares in a foreign company, provided that the aggregate amount of shares in this company owned by other Ukrainian tax residents is 50 per cent or more;
  • de facto controls foreign companies individually or mutually with other affiliated residents of Ukraine.

Is it possible that CFC reporting will be terminated?

There are currently several legislative initiatives to postpone CFC reporting.

One of the draft laws currently being most actively discussed by the tax consultants community is the Draft Law. No. 8137 dated 19.10.2022, «On Amendments to the Tax Code of Ukraine on Improving the Taxation of Controlled Foreign Companies». If adopted, the deadline for filing the 2023 report will be postponed by 2025.

Nevertheless, the Draft Law will not eliminate the obligation to file the 2022 CFC report by 1 May 2024.

Moreover, the chances and the date of adoption of the Draft Law are still unclear, and thus, it is advisable to file the CFC report shortly.

How do you prepare for the filing of CFC reports?

First of all, we recommend calculating the number of foreign companies that may be deemed to be falling under the definition of the CFC, consulting with a specialist regarding the information required for the report and making appropriate calculations to determine whether any CFC tax liabilities may arise in Ukraine.

The form of the report and the procedure for its completion were adopted by the Order of the Ministry of Finance of Ukraine No. 254 dated 25.08.2022.

Each report must be attached with a certified copy of the CFC’s financial statements.

Suppose the jurisdiction of the CFC does not require the preparation of financial statements. In that case, the owner of the CFC has to prepare the financial statements following international financial reporting standards.

In case the financial statements of the CFC cannot be prepared on time and the adjusted profit cannot be calculated, a ‘short-form’ report may be used to disclose the main details of the CFC, such as the controller’s share and the CFC ownership structure. However, the standard report must be filed by the end of 2024 anyway.


Failure to comply with the CFC legislation may result in the imposition of fines:

  • equivalent to 100 minimum living wages (currently UAH 302,800) – for failure to file the CFC report;
  • equivalent to 1 minimum living wage (UAH 3,028) for each day of delay – for late filing of the CFC report. Simultaneously, the maximum amount of the fine for late submission may not exceed 50 subsistence minimums (UAH 151,400);
  • 3% of the CFC’s income or 25% of the CFC’s adjusted profit (whichever is higher), but not exceeding 1000 minimum living wages (UAH 3,028,000) for failure to disclose specific information in the report.

Given all of the above, we strongly recommend not to put it off until later and get prepared for the CFC reporting as soon as possible.