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Arzinger lawyers win an over UAH 263 million tax dispute on application of exchange differences and payables discounting

21/ 01/ 2021
  Arzingers Tax and Customs Litigation team has successfully represented NUFARM UKRAINE, an international agrochemical corporation, one of the leaders in the manufacture and sale of plant protection products, in pre-trial and judicial appeals against tax notifications-decisions. Arzinger lawyers managed to convince the State Tax Service of Ukraine at the stage of pre-trial (administrative) appeal that the Client had correctly applied the Accounting Provision (Standard) 21 Impact of Currency Fluctuations. The additional accruals of corporate income tax in excess of UAH 200 million were cancelled, making the case quite unique.  Further, with the well-developed and effectively implemented protection strategy, Arzinger lawyers had their arguments supported by the courts. Thus the Client had no obligation to discount the amount of debt on loans obtained from non-residents and include the difference between the future and present debt value, taking into account depreciation, into its income, as well as to accrue VAT on the cost of free services allegedly provided by the Clients regional representatives to distributors. Having considered the case, the courts canceled the additional tax accruals worth upward of UAH 63 million. The project was handled by a team of lawyers comprised of Associate, attorney-at-law Nikita Larionov, Junior Associate Kseniia Dobrieva, Paralegal Anastasia Prysiazhniuk, and was headed and supervised by Partner, attorney-at-law Kateryna Gupalo.

Arzinger’s Tax and Customs Litigation team has successfully represented NUFARM UKRAINE, an international agrochemical corporation, one of the leaders in the manufacture and sale of plant protection products, in pre-trial and judicial appeals against tax notifications-decisions.

Arzinger lawyers managed to convince the State Tax Service of Ukraine at the stage of pre-trial (administrative) appeal that the Client had correctly applied the Accounting Provision (Standard) 21 “Impact of Currency Fluctuations”. The additional accruals of corporate income tax in excess of UAH 200 million were cancelled, making the case quite unique. 

Further, with the well-developed and effectively implemented protection strategy, Arzinger lawyers had their arguments supported by the courts. Thus the Client had no obligation to discount the amount of debt on loans obtained from non-residents and include the difference between the future and present debt value, taking into account depreciation, into its income, as well as to accrue VAT on the cost of free services allegedly provided by the Client’s regional representatives to distributors. Having considered the case, the courts canceled the additional tax accruals worth upward of UAH 63 million.

The project was handled by a team of lawyers comprised of Associate, attorney-at-law Nikita Larionov, Junior Associate Kseniia Dobrieva, Paralegal Anastasia Prysiazhniuk, and was headed and supervised by Partner, attorney-at-law Kateryna Gupalo.

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