The Supreme Court clarified the nuances of paying penalties for overdue VAT refunds during martial law

Martial law in Ukraine is not an automatic ground for the state to be exempt from paying penalties for overdue value-added tax (VAT) refunds. This is reported by UNN with reference to the Supreme Court.

Details

This conclusion was reached by the Cassation Administrative Court as part of the Supreme Court. They clarified: for the application of the exception provided for in paragraph 2 of paragraph 200.23 of Article 200 of the Tax Code of Ukraine (Procedure for determining the amount of tax subject to payment (transfer) to the State Budget of Ukraine or reimbursement from the State Budget of Ukraine (budget reimbursement), and terms of settlements), according to which no penalty is charged, the controlling body must prove the existence of specific force majeure circumstances.

This refers to circumstances which, due to martial law, made it impossible to enter data into the Register of applications for the return of the amount of budget VAT refund and to make the refund.

In the absence of such evidence, the penalty is charged in the general manner (120% of the NBU discount rate).

Recall

In the summer of 2025, changes to the Tax Code came into force in Ukraine, exempting mobilized individual entrepreneurs from paying taxes and submitting reports during military service. The exemption of individual entrepreneurs from paying taxes is applied automatically based on data from the Unified State Register of Conscripts.