The Ministry of Finance (MoF) issued Guidance Letter No. 31-11130-09-10/21370 dated on July 25, 2016, explaining the corporate income tax treatment of dividends paid by Ukrainian residents.
According to letter, dividends received by the companies registered as unified taxpayers are subject to advance payments of corporate income tax, as the Tax Code does not provide an exemption for such dividends. Dividends paid to individuals, non-profit organizations and ultimate shareholders (up to the amount of the dividends received by the distributing company from its subsidiaries) are exempt from corporate income tax.
Dividends must be recorded by the recipients of the dividends in the tax period in which the decision regarding distribution of dividends is approved. However, this does not apply to dividends received from financial investments.
