<\/p>\n
EBS has launched its own podcast. Tax, finance, accounting, HR, legal services and management consulting are all areas EBS works with every day \u2014 along with the dozens of questions businesses bring to its teams.<\/span><\/p>\n Olena Volska, Managing Partner at EBS<\/strong>, hosts the podcast. In each episode, she sits down with colleagues and guest experts to discuss what businesses are having to rethink, recalculate, and change as they go.<\/span><\/p>\n The first episode focuses on tax, with Yehor Synytsyn, Partner and Head of Tax at EBS<\/strong>, joining Olena as her guest. Yehor has worked in tax for almost 15 years. He started his career as a state tax inspector before moving into business and consulting. With a background in finance, he brings every tax model back to the numbers: how much it saves the business, how much it costs to maintain, and whether it still makes commercial sense today.<\/span><\/p>\n The first episode is particularly worth watching for businesses that haven’t reviewed their tax model in a while. If your structure involves Ukrainian sole traders (FOPs), multiple companies, franchising or other arrangements that have operated for years on the basis that \u201cwe\u2019ve never had a problem before\u201d, there are now plenty of reasons to take another look.<\/span><\/p>\n The conversation explores what the tax authorities are focusing on today, why having all the paperwork in place may no longer be enough, and what to do when an established structure starts raising questions even for the business owner.<\/span><\/p>\n \u201cWe\u2019ve always done it this way\u201d is no longer a strong argument<\/strong><\/p>\n FOPs, multiple companies, agency agreements and franchise arrangements are often left untouched for years. They may have delivered the intended result when they were first introduced, competitors may have used similar structures, the accounting team may have become accustomed to them, and the tax authorities may not have asked too many questions. Over time, they simply became the way the business operated.<\/span><\/p>\n But legislation, case law and the tax authorities\u2019 own approach have continued to evolve. Tax audits have changed too: having all the right documents may no longer be enough if the transaction itself raises questions.<\/span><\/p>\n Imagine a company pays an agent 10% of a contract value for bringing in a client. The paperwork is all there: an agreement, completion certificates, invoices and even a list of transactions in which the agent was supposedly involved. But once you look at how the sale actually happened, it turns out the company\u2019s own team sourced the client. The same team conducted the negotiations, prepared the commercial proposal, agreed the terms and took the contract through to signature.<\/span><\/p>\n At that point, the tax authorities care less about the paperwork than about one straightforward question: what exactly did the agent do to earn the 10% fee?<\/span><\/p>\n Business fragmentation: FOPs are only one part of the picture<\/strong><\/p>\n Business fragmentation is no longer simply about operating through a network of FOPs under Ukraine\u2019s simplified tax regime. A business might divide sales between several companies, operate individual locations through separate legal entities or build a franchise network \u2014 all of which may formally appear to be independent businesses.<\/span><\/p>\n But if the same people set prices across the entire structure, control bank accounts, procurement, staff and day-to-day operations, those separate FOPs or companies begin to look far less independent.<\/span><\/p>\n Simply replacing FOPs with companies does not make the underlying issue disappear. Nor will a franchise agreement necessarily help if the franchisee has no real say over suppliers, recruitment or how its money is managed.<\/span><\/p>\n As Yehor puts it, if a business owner is already looking at the structure and wondering whether it might amount to fragmentation, the concern is probably worth taking seriously.<\/span><\/p>\n What does an old tax model really cost?<\/strong><\/p>\n Moving away from an established tax model is almost always perceived as an additional cost. VAT is a good example: the first calculation often assumes that becoming VAT-registered will simply add 20% to the price.<\/span><\/p>\n In reality, some VAT may already be embedded in procurement, imports, logistics and other costs. In some EBS projects, once the numbers were properly modelled, the required price increase was only a few percentage points.<\/span><\/p>\n The old structure is not free either. Separate bank accounts, paperwork, accounting and legal support, and moving funds between different entities all cost money to maintain year after year. As the business grows, banks, auditors, investors, financing requirements and dividend payments add further layers of complexity.<\/span><\/p>\n For some companies, once all these costs are taken into account, the old model no longer looks nearly as attractive. Maintaining it may consume a substantial part of the tax saving it was originally designed to achieve.<\/span><\/p>\n During the episode, Olena Volska and Yehor Synytsyn also discuss tax audits, business purpose and the forthcoming implementation of ATAD. Yehor explains why even a poorly reasoned tax audit report is no reason to underestimate the tax authorities: inspectors are learning too, following case law and gradually changing their approach.<\/span><\/p>\n Towards the end of the conversation, Olena asks what a Ukrainian entrepreneur can do if they simply want some peace of mind about their taxes for the next two years. Yehor points out that even \u201cpeace of mind comes in 50 shades\u201d, but his advice starts with something simple: recalculate existing structures and establish whether they still deliver the savings they were originally designed to achieve.<\/span><\/p>\n Another piece of advice from the conversation: don’t wait too long to ask questions. Some of the issues businesses bring to advisers today would have been far easier to address three, five or even seven years ago.<\/span><\/p>\n If your tax model still contains something that falls into the \u201cwe\u2019ve been doing it this way for years\u201d category, there will probably be something in the first episode that feels familiar. The full conversation has far more examples, debate and detail than we could fit into this article.<\/span><\/p>\n Watch the full podcast with Olena Volska and Yehor Synytsyn in Ukrainian via the link: <\/span>https:\/\/youtu.be\/6VwejuKqHcM?si=bHjOvomXUR600rtc<\/span><\/a><\/p>\n