- If a VAT payer generates scrap metal of black and colored metals as a result of their activities, which is subsequently supplied on the customs territory of Ukraine with VAT exemption, the payer may have an obligation to charge compensatory VAT.
- Scrap metal is defined as products or parts of products that have lost their operational value due to physical or moral wear and contain black or colored metals or their alloys, as well as metal products with irreparable defects, residues of black and colored metals and their alloys.
- The legal basis for VAT taxation is established in Chapter V and Subsection 2 of Chapter XX “Transitional Provisions” of the Tax Code of Ukraine.
- Operations with the supply of waste and scrap of black and colored metals, as well as paper and cardboard for recycling, are temporarily exempt from VAT until January 1, 2027.
- Tax obligations and VAT credit formation rules are set out in specific articles of the Tax Code of Ukraine.
- VAT payers are required to keep separate records of taxable and non-taxable transactions, which are reflected in tax declarations.
- If a taxpayer generates scrap metal of black and colored metals that is subsequently supplied on the customs territory of Ukraine with VAT exemption, the taxpayer is obligated to calculate VAT obligations and prepare consolidated tax invoices according to the rules set out in the Tax Code of Ukraine.
Source: news.dtkt.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.
