Draft Law No. 2737 introduces amendments regarding the formation of a tax group. On 5 April 2013, amendments to the Tax Code were sent to be approved by the parliament. The legislation will allow companies in Ukraine to form a consolidated tax group for corporate income tax purposes. This means that a loss making company in a group will be in a position to transfer its tax losses to another company in the same group. This will therefore allow companies to use their losses more quickly by transferring them within the group instead of carrying them forward for use against future profits in the same company.
A tax group will be formed if following criteria are satisfied:
One of the members of the tax group holds directly or indirectly at least 50% of the shares in the capital of another member(s), the corporate income tax liabilities paid for the previous calendar year by the members of the tax group constitute in total at least UAH 100 million and the total proceeds from sales of goods (services) collected by the tax group members in the previous calendar year constitute at least UAH 1 billion.  The tax group members should be registered as regular corporate income taxpayer’s and cannot enjoy the special taxation regimes.
