Application of Cash Method in Construction: Rules and Considerations in Ukraine

• Construction companies in Ukraine can choose to apply the cash method for some contracts and not for others.
• There is no clear guidance on whether a company can switch to the cash method for specific contracts.
• The cash method is determined by the date of receiving funds or compensation for goods or services.
• It is recommended that if a company chooses the cash method, it should apply it to all construction contracts.
• However, there is a possibility for selective application of the cash method if the company insists and obtains clarification from the tax authorities.
• The choice to apply the cash method is indicated in the tax declaration.
• The decision to apply or discontinue the cash method should be stated in the company’s accounting policy.
• If a company decides to discontinue the cash method, the VAT amount increases by the value of goods or services provided but not yet paid for.
• The cash method of VAT accounting is not explicitly mentioned as part of the accounting policy, but it should be determined by the company’s policy.
• The accounting policy includes principles, methods, and procedures used for financial record-keeping.

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.

---

---