How is the financial result indicator transferred from accounting to tax reporting

In accordance with subsection 134.1.1 of clause 134.1 of article 134 of the Tax Code of Ukraine dated December 2, 2010 No. 2755-VI as amended (hereinafter – TCU), the object of taxation is income with a source of origin in Ukraine and beyond, which is determined by adjustment (increase or decrease) of the financial result before taxation (profit or loss), determined in the financial statements of the enterprise in accordance with the national provisions (standards) of accounting or international standards of financial reporting, for the difference, which is determined by the relevant provisions of the TCU.

At the same time, the first paragraph of Clause 44.1 of Article 44 of the Code of Civil Procedure establishes that for taxation purposes, taxpayers are required to keep records of income, expenses and other indicators related to the determination of taxable objects and/or tax liabilities, based on primary documents , registers of accounting, financial reporting, other documents, information related to the calculation and payment of taxes and fees, the management of which is provided for by law.

To calculate the object of taxation, the payer of income tax uses the data of accounting and financial reporting on income, expenses and financial result before taxation (paragraph 44.2 of article 44 of the TCU).

According to part two of Article 3 of the Law of Ukraine dated July 16, 1999 No. 996-XIV “On Accounting and Financial Reporting in Ukraine” (hereinafter – Law No. 996), accounting is a mandatory type of accounting maintained by an enterprise. Financial, tax, statistical and other types of reporting that use a monetary measure are based on accounting data.

Primary documents are the basis for accounting of economic transactions. To control and regulate data processing, consolidated accounting documents can be drawn up on the basis of primary documents (part one of Article 9 of Law No. 996).

Therefore, the Tax Declaration on the income tax of enterprises, approved by the order of the Ministry of Finance of Ukraine dated 20.10.2015 No. 897 with changes and additions (hereinafter – the Declaration), is filled out on the basis of primary documents drawn up in accordance with accounting, in hryvnias without kopecks with appropriate rounding according to generally established rules.