VAT Tax Credit Treatment for Expired Creditor Debt Write-offs from Resident Suppliers

• The tax authority explains how VAT tax credit is handled when creditor debt is written off after the statute of limitations expires for goods and services received from resident suppliers
• Tax credit for the reporting period is determined based on contractual value of goods and services and includes taxes calculated at established rates for purchases, acquisitions, and imports
• Tax credit accrual occurs regardless of whether goods or services began being used in taxable operations during the reporting period
• The date for including tax amounts in tax credit is the earlier of either payment date from bank account or receipt date of goods and services
• Tax invoices received from the Unified Register of Tax Invoices serve as basis for buyers to calculate tax credit amounts
• Bad debt is defined as debt where the statute of limitations has expired, which is generally three years according to the Civil Code of Ukraine

Source: od.tax.gov.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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