Disputes with the bodies of the State Fiscal Service

Disputes regarding “reality” of transactions

Attorneys of KM Partners successfully represent clients’ interests in disputes with the State Fiscal Service regarding so called “reality” of transactions.

In such category of disputes the attorneys focus their attention on formation of evidential basis as a necessary condition for successful defense/protection of clients’ interests. Despite the provisions of Part 2 Article 71 of the Code of Administrative Procedure of Ukraine, requiring that the State Fiscal Service shall prove the lawfulness of their decision, de facto courts try such cases, evaluating the evidences of the reality of transactions available in the court materials. Such approach of the court requires active position of the plaintiff in respect of providing such evidence to the courts.

Our attorneys have considerable experience in trials regarding “reality” of business transactions complicated by “criminal” elements: when criminal proceeding is initiated against officials of contractors of the tax payers or even when there is a verdict in the criminal case.

Disputes regarding tax accounting of payments for intellectual property objects, technologies

Attorneys of KM Partners have experience in representing clients in court disputes against the State Fiscal Service authorities related to the issues of tax accounting of payments for intellectual property objects on the basis of license agreements and other agreements.

In particular, our attorneys are experienced in trials related to qualification of royalty payments within the meaning of the Law of Ukraine “On Corporate Profit Tax” and the Tax Code of Ukraine in the version effective till January 1, 2015.

Qualification of payment as royalty or other fee incurs different tax implications: whether payment is subject to VAT or not, whether such payment is deductible or should be capitalized as the value of intangible assets.

Considering quite ambiguous definition of the term “royalty” for the tax purposes the tax payers and tax authorities not always have common understanding whether particular payment should be qualified as a royalty or not for tax purposes.

The approach suggested by our attorneys regarding qualification of royalty payments was supported by the court decisions.

In particular, attorneys of KM Partners successfully represented interests of clients in the dispute regarding tax accounting of license fees for the use of technologies and software.

Customs disputes

Аttorneys of KM Partners are experienced in representing the interests in the court disputes against the State Fiscal Service in respect of estimation of customs value of goods.

In particular, our attorneys successfully defended interests of well-known company, which main activity is wholesale of household chemical goods, in dispute regarding inclusion of license fees (royalties) into the customs value of imported goods.