Frequently asked questions about Ukraine VAT
What is VAT?
VAT is the abbreviation of Value Added Tax and is in general due when goods and/or services are sold. It is generally chargeable on all taxable goods and services supplied (i.e., consumed or otherwise utilized) in Ukraine. It is a consumption tax because it is ultimately borne by the final consumer.
Who must pay VAT?
Generally, VAT is invoiced by the supplier that is selling goods or services and collected from the customer. Subsequently, the supplier reports and remits the collected VAT to the tax authorities.
Where a non-resident supplier (such as Zoom) provides electronically supplied services to non-business customers, including non-VAT registered private entrepreneurs, in Ukraine, there is a requirement to collect and remit VAT on these supplies. The responsibility to collect and remit VAT depends on whether the Ukrainian customer is a business customer (i.e., a legal entity or VAT-registered private entrepreneur) or a non-business customer (i.e. a consumer or non-VAT registered private entrepreneur).
If you are a business customer, you should provide Zoom with your VAT registration number. If your VAT registration number is valid, then no VAT will be charged on the supplies made to you by Zoom; however, you may be required to self-assess for the VAT under the “reverse charge” mechanism. If you are not a business customer or if you are a business but do not provide a valid VAT registration number, VAT will be charged on the supplies made to you, unless you provide your state registration number “EDRPOU” (see details below).
Why am I being charged VAT?
Video conferencing services and telecommunication (in the form of electronic communication services) supplied by Zoom fall within the rules concerning electronically supplied services by non-resident service providers to non-business (B2C) customers in Ukraine. As such, Zoom is required to collect and remit VAT on supplies made to non-business customers in Ukraine.
What is a VAT registration number?
A VAT registration number is a unique number issued by the State Tax Service of Ukraine to legal entities or private entrepreneurs that are registered for VAT in Ukraine. Zoom will not charge VAT to customers that have provided a valid VAT registration number.
How do I enter my VAT registration number?
Note: Starting July 17, 2023, certain account owners and admins will notice a dedicated Plans and Billing section within their ADMIN menu.
To enter your VAT registration number, please follow these steps:
- Sign in to the Zoom web portal.
- In the navigation menu, click Account Management then Billing.
- Click the Billing Information tab.
- Under Sold To Contact, click Edit to edit the VAT registration number (which appears after the Sold To Contact address fields).
- Enter your VAT registration number.
- Click Save Changes.
Zoom performs periodic validation checks of customer VAT numbers to ensure that the VAT number remains valid. If, during these periodic validations, it is identified that your VAT number is no longer valid, Zoom may automatically update your account so that future invoices are subject to VAT. Where this happens, VAT will be charged on all future invoices until such time that a valid VAT number is provided. To provide an updated VAT number refer to the above steps.
You are required to notify us if there is a change to your VAT registration status.
Does Zoom have a VAT registration number?
Yes. Zoom is registered for VAT in Ukraine as a non-resident supplier of electronically supplied services. Zoom’s VAT registration number will be shown on the invoice it issues to you.
How is Zoom determining which customers Ukrainian VAT applies to?
If a customer's ‘Sold To’ location is in Ukraine and the customer has not provided a valid VAT registration number at the time of invoicing, Zoom will charge Ukrainian VAT (at the standard rate) on its invoices.
This information is subject to cross-referencing against other data to verify that the ‘Sold To’ country is accurate.
It is your responsibility as a customer to ensure that your ‘Sold To’-address is accurate.
Is there a minimum threshold purchase amount before VAT is applied?
No, where a customer in Ukraine has not provided a valid VAT registration number, Zoom will charge VAT on all supplies made to you.
Are there any special exemptions applicable for charities or other organizations under which VAT may not be charged?
No, all supplies of electronically supplied services made to non-business customers in Ukraine are subject to VAT.
However, if you are a legal entity that is not registered for VAT, you may still be treated as a business customer and such, Zoom is not required to charge VAT on supplies made to you. If this applies to you, please contact Billing and provide your state registration number “EDRPOU” to update your tax-exempt status. As a business customer, you will still be required to self-assess the VAT due under the “reverse-charge” mechanism.
Are there any VAT obligations for me as a customer?
If you have provided a valid VAT registration number to Zoom or where you have confirmed your legal entity status with Zoom’s Billing team, no VAT will be charged on the supplies made to you. However, you may be required to report the purchase and self-assess for the VAT due under the “reverse charge” mechanism in your VAT return or, if you are not registered for VAT, by submission of the “Calculation of tax liabilities, assessed by non-VAT registered recipient of services provided by non-residents on the customs territory of Ukraine, including by their non-VAT-registered permanent establishments”. For more details on compliance please refer to the respective by-law.
There is no separate VAT obligation for a customer who is not a business customer for Ukrainian tax purposes, i.e., individuals or private entrepreneurs that are not registered for VAT.
What if I have a VAT ID and forget to enter it?
The VAT number can be entered at any time. If entered before the next invoice, Zoom will not charge VAT on the next invoice or future invoices issued to you. If no VAT number is entered at the time the next invoice is issued, VAT will be charged until a valid VAT number is entered or you contact Billing to confirm your legal entity status.
If a valid VAT number is entered or you verify your legal entity status by contacting Billing and VAT has previously been charged on the invoices issued to you, then upon request by you, Zoom may refund any VAT included on invoices issued in the thirty days prior to a valid VAT number being provided / legal entity status being confirmed. However, VAT will not be refunded on any invoices issued outside of this thirty-day period.
Decision tree – My “Sold To” address is Ukraine; will I be charged VAT?
Every customer is unique and so are their specific tax circumstances. The above-stated information should not be considered as tax advice, but as a general overview of relevant tax rules in Ukraine. Zoom cannot provide you with tax advice for your individual situation, and therefore we strongly recommend speaking with a professional tax advisor for tailored advice.
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