VAT Liability When Writing Off Assets: Requirements and Documentation for Tax Purposes

• When low-value non-current assets or inventories are written off and can no longer be used in business activities, the VAT payer must accrue VAT liabilities according to Article 198.5 of the Tax Code.
• If fixed assets are liquidated by the VAT payer’s own decision, this is treated as a supply for VAT purposes at regular prices, but not lower than the book value at the time of liquidation.
• No VAT liabilities arise if fixed assets are destroyed, dismantled, or otherwise rendered unusable for their original purpose, provided a properly executed document confirming this is submitted to the tax authorities.
• The document confirming the write-off must contain all necessary information to identify the transaction and meet primary documentation requirements, regardless of its form.

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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