- VAT exemption under subpara. 197.1.14 of the Ukrainian Tax Code does not apply to construction/repair works; it covers only the supply of housing or certain unfinished/future residential property, not building or repair services.
- For restoration and repair of housing financed from budget funds, the relevant exemption is under para. 197.15 of the Tax Code, which the tax authority says can cover construction, reconstruction, restoration, and major repairs of housing.
- VAT exemptions are mandatory and depend on the specific transaction, not the taxpayer’s choice; a contractor cannot opt out of the exemption if the operation qualifies.
- The exemption applies only to comprehensive capital repair/reconstruction of an entire residential building funded through state/local budgets; it does not apply to work on separate elements of housing (e.g., replacing a few windows or localized roof repairs).
- If the customer is a non-VAT payer but indicates VAT in the payment order, this does not affect the contractor’s exemption under para. 197.15; the tax invoice should be issued to a non-payer.
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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