How can foreign and Russian enterprises conduct profitable business in Ukraine avoiding mistakes tha
Many foreign and Russian companies and their owners, players of large and medium business sectors, still consider Ukraine as a cost-effective platform for business, despite global financial crisis. Their decision to conduct profitable business on the territory of Ukraine is based on several factors: Ukraine has a unique geographical location, well- developed system of transport communications, good financial and industrial potential, large market for commodities, cheaper labor force in comparison to its western neighbors’ (average salary in Ukraine 200-400 Euros per month), relatively low priced natural resources in comparison with the world prices (coal, iron ore, etc.), rich soil, and good climate.
About 97% of new foreign and Russian enterprises are not aware of specifics and conditions of conducting business in Ukraine.
Such state of misleading awareness is mainly due to the fact that foreign and Russian businessmen receive distorted information from the media and use semi-skilled consulting services (accountants, auditors, lawyers, attorneys, etc.)
Law and audit Association «Biznes-Rost» is the leader in the development and implementation of legal schemes to save on taxes (VAT, tax on profits), reduction of financial losses, and increase in net profit in Ukraine. For this reason, since the introduction of latest version Tax Code in Ukraine (from 01.01.2011); therefore 4 to 10 foreign and Russian enterprises in face of their owners or CEOs started to turn for consultative and practical support to Law and audit Association «Biznes-Rost» for solving problems that they meet while conducting business in Ukraine. Unfortunately, such outcries for help, mainly, take placewhen the mistakes have already been made.
1. When registering a new enterprise its owners do not take into account the economic feasibility of forming statutory fund, that is capital represented in form of money and equipment including foreign direct investments for further obtaining a Certificate of VAT payer.
2. The complexity of getting this Certificate is also ignored, that results in inability to conduct business with the partnering VAT-payers.
3. In Ukraine, in the case of inability of obtaining Certificate of a VAT payer for the enterprise on the start-up stage, its owners cannot build and use legal work scheme with companies-VAT payers.
4. When doing business in Ukraine, foreign and Russian companies do not use legal schemes to save on taxes (VAT and tax on profits), while paying these taxes in full amount is making their business initially marginal (or unprofitable) and not competitive.
5. Initially,foreign and Russian businessmen do not calculate and analyze features of Ukrainian financial and tax schemes that result in unreasonable expenditure of funds and decrease in profitability of their business.
6. Foreign and Russian founders, as well as plant managers, do not fully know current tax legislation, practice, and specifics of the Ukrainian State Tax Inspectorate and other controlling bodies, leading their companies to penalties and additional tax commissions.
7. Foreign and Russian owners and CEOs of enterprises hire and use services of unprofessional and dishonest accountants and lawyers who improperly perform their professional duties. As the result, these companies bear unreasonable financial losses and damages.
To avoid theabove mistakes while doing business in Ukraine,Law and Audit Association «Biznes-Rost» has developed and successfully implemented in practice next legal schemes to help foreign and Russian companies prevent unjustified taxation and financial losses, maximizing net income from savingson VAT and income tax.
When registering a new enterprise Law and audit Association «Biznes-Rost» uses mechanism of forming the statutory fund in accordance with the requirements of the new Tax Code of Ukraine with the best possible financial benefits for this company and for further implementation of business and successful receipt of Certificate of VAT payer if needed.
«Biznes-Rost» has worked out and successfully put into practice theuniversal scheme of cooperation between enterprises VAT-payer and tax defaulter. Under this scheme,the company-tax defaulter (newly created company) can work successfully with its contractors-VAT payers, get profit and at the same time, generate economic turnover for obtaininga Certificate of VAT payer (UAH 360 000)in future. In this way, their contractors-enterprises VAT payers can receive tax credit for VAT and for marginal costs.
Law and audit Association «Biznes-Rost» recommends its clientsnext legal schemes in order to maintain stable and profitable business in Ukraine and receive additional cash investments:
1. Acquisition of tax credit for VAT on favorable terms to meet monthly obligations to pay VAT and income tax.
2. Take on lease (temporary or gratuitous use) tax credit for saving company’s money and for implementation of fiscal and financial maneuvers.
3. Reduce to 50% of taxable margin trading on goods in production and trading activity (wholesale and retail) and thereafter decrease in VAT and income tax.
With many years of practical experience in business protection from illegal actions by workers of the State Tax Inspectorate and other controlling bodies, Law and Audit Association «Biznes-Rost» builds for its client’s enterprises schemes of economic security.
According to client’s wishes our Association can select and test the suitability of professional accountants and lawyers, as well as provide recommendations on choosing Ukrainian software needed for accounting and management.
Law and Audit Association «Biznes-Rost» provides its clients with a new service-total financial analysis of a newly established business or business project and develops for it legal cost saving schemes and reduction of financial and tax losses (VAT and income tax), taking into account individual features of each business.
Foreign and Russian businessmen when start planning their business in Ukraine should act as successful generals-conquerors and winners, in accordance with contemporary global practice and development strategies for large businesses.
As successful generals and winners, our clients should know that the victory in business, as well as on war requires preparation. That is why, to get guaranteed income from their business they need detailed and clear business plan designed in advance. Next, businessmen should accurately define and calculate all expected financial and fiscal losses and costs of their business. After this, they should develop legal cost saving schemes and schemes for reduction of financial and tax losses (VAT and income tax), taking into the account individual features of their business. Only after having completed the stated above steps you should start-up your business on the territory of Ukraine. Implementation of such an action plan by foreign and Russian businessmen will help them avoid above-mentioned mistakes and build stable, lucrative, and competitivebusiness in Ukraine.
Law and audit Association «Biznes-Rost»
Contact telephone number: +38(050)7550371
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