Corporate, Commercial Law and Dispute Resolution · Contracts, Commercial Law and Transactions
Tax penalty relief may be available where a Ukrainian taxpayer can show that a sanction was imposed without the required legal basis, without taxpayer fault or in breach of the applicable procedure. Businesses should review the underlying violation and the authority's process before treating a penalty as final.
Lack of Taxpayer Fault
Circumstances outside the taxpayer's control, including technical failures and force majeure, are possible grounds to argue that a penalty should not apply. Evidence of the event and the taxpayer's attempted compliance is important.
Voluntary Correction
Some errors may be corrected before an inspection or formal authority action. The source material notes voluntary correction as a circumstance that can affect the application of sanctions.
Court Cancellation
A taxpayer can challenge a penalty in court where the assessment is unlawful or the procedure was not followed. The claim should distinguish between disagreement with the underlying tax amount and defects in the penalty itself.
Temporary Relief, Moratoria and Amnesty Measures
Temporary legislation may suspend or limit penalties for specified periods or categories of violations. Eligibility should be documented against the conditions of the relevant measure.
Procedural Violations by the Tax Authority
Defective notice, inspection procedure or penalty documentation can become part of the defence position where the authority failed to follow mandatory steps.
Business Preparation
file returns and payments on time where possible;
retain evidence of technical failures and other exceptional circumstances;
correct identified errors before an official inspection when the rules allow;
perform internal tax reviews;
preserve all notices and procedural documents for appeal.
Tax penalty defence strategy should identify the precise legal and factual reason the sanction is disputed. Strong evidence of timely action, lack of fault or procedural error can turn a general complaint into a structured request for cancellation or relief.
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Price: Tax Penalties in Ukraine: Grounds for Cancellation or Relief