- According to the Civil Code of Ukraine, factoring operations involve one party (the factor) transferring or committing to transfer funds to another party (the client) for a fee, while the client assigns or commits to assign their right to a monetary claim to a third party (the debtor).
- Banks or other financial institutions can act as factors if they have the legal right to carry out factoring operations.
- According to the Tax Code of Ukraine, factoring operations involving currency, securities, investment certificates, fixed-income mortgage certificates, secured mortgage loans, housing vouchers, land bonds, and derivatives are not subject to VAT.
- Other factoring operations are subject to VAT.
Source: od.tax.gov.ua
Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.
