Should VAT be charged when writing off accounts payable? Explanation by the Main Department of the SFS in the Chernivtsi region

• In Ukraine, when a creditor’s debt is written off, the VAT payer
• the buyer must calculate the VAT liabilities according to the tax code and register it in the ERP system.
• The Chernivtsi Regional Tax Administration explains how the operation of writing off a creditor’s debt is reflected in the buyer’s VAT accounting when the statute of limitations has expired and no settlements have been made with the suppliers.
• According to the tax code, the tax credit for the reporting period is determined based on the contractual value of goods/services and consists of the taxes paid by the taxpayer at the rate established by the tax code.
• The tax credit is related to the purchase or manufacture of goods/services, the acquisition of fixed assets, and the import of goods/non-current assets into Ukraine.

Source: news.dtkt.ua

Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.

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