A plenty of problematic issues arise, when you try to establish a company in Ukraine, namely – the taxation system, which one legal form is it better to choose, what particular documents shall be submitted at the registration stage, which authorities do it best, whether a license for some activities is required etc. There are also certain problems for foreigners while establishing a company, such as a work permit. These and other issues are discussed in the article below.
Many problems have already been resolved in the sphere of business regulation. Particularly, the Supreme Rada of Ukraine adopted the law on a moratorium on conducting the planned state inspections of small and medium-sized businesses by June 30, 2017, namely the Law “On the Peculiarities of Implementation of the State Supervision (Control) in the Sphere of Economic Activity” No. 3353. Adoption of the Law No. 3153 will reduce the pressure on the businesspersons by the controlling bodies. At the same time, it should be noted that under the provisions of the Law, the unscheduled inspections might be conducted only if sufficient grounds are indicated.
Cabinet of Ministers revoked as many as 367 regulations recently to deregulate business. The respective decision was made at the Government meeting on November 23, 2016.Supreme Rada of Ukraine supported the draft law №4194 “On Amendments to Certain Legislative Acts of Ukraine on the Use of Seals by Legal Entities and Individual Entrepreneurs” in the second reading. The draft law posesses the paramount importance to Ukrainian legislation, since its norms provide for the complete cancellation of seals. It should be also highlighted, the bill won’t concern all the citizens, but only the economic entities. Consequently, the law will foresee the elimination of the use of seals in the relations of business entities with state authorities and local self-government bodies. Issues of the conducting business in Ukraine, uncommon for the foreigners
Despite the deregulation, many unresolved problems, when foreigners do business in Ukraine, remain. Firstly, the outdated labor legislation. In the Labor Code of 1971 a lot of the post-soviet norms still appear, as well as in the by-laws. Thus, the employee turns out to be more secure, his rights being a priority. In addition, the employer, for instance, may face the problems with the dismissal of his employees. Secondly, the non-competition and non-enticing norms are still considered unlawful in Ukraine. In general, they are illegal and unconstitutional, because every person has the right to work and the right to engage him/herself in the entrepreneurial activity. Despite this fact, the companies still do enter the noncompetitive and non-enticing agreements in spite of their illegality. Thirdly, the complicated accounting, described by a large amount of information, which should exist in a paper form, significantly slowing down the course of business. Also due to the formalization of all relations on paper, the accountant becomes an irreplaceable person in business, for example, the accounting reports on salary shall be submitted monthly. Formalism in Ukraine becomes even symbolic. For instance, each payment must end with an act of service provided. Fourthly, the foreigners have a limited residence time in Ukraine, and immigration permits are required for them to stay in Ukraine and do business. Fifthly, the corruption-related problems, bureaucracy and formalism of the migration service authorities, the fiscal authorities and others that do not provide a proper explanation addressing some specific issues, and as a result, a person needs to rework the same documents several times.
Ukraine is situated at the 80th place in the ranking of doing business ease out of 190 countries. At the same time, concerning the ease of establishing a company (enterprise) – at the 20th place, being a very high result, but for connecting to the grid – 130th, registration of property rights – 63th, taxation – 84th, the worst are the indicators of the ease of obtaining building permits – as far as at the 140th place. Thus, the ease of setting up a business in Ukraine is offset by the complexity of conducting it. At the same time, if you would like to establish a company in Ukraine without connecting to electricity etc., perhaps, it will not be so difficult for doing a business.
Let us now dwell upon the stages the person seeking to establish their own business is to go through: Stage 1. Choosing the organizational-legal form of the company in Ukraine (hereinafter – OLF)
Entrepreneurial activity can be carried out by a private individual entrepreneur or a entity (in the form of a private enterprise, a full partnership, a limited partnership, a limited liability- or an additional liability company, a joint-stock company, through a foreign representative office, etc.). Organizing and doing business depends on the right choice of an organizational and legal form. Let us consider in more detail the types of all the forms mentioned.
The most common forms available to any person who decided to do business are: PIE (private individual entrepreneur), PP (private enterprise) and LLC (limited liability company), in addition, we will also dwell upon a joint venture and an enterprise with foreign investments. PIE (private individual entrepreneur)
If you plan to provide services or sell goods to the end-users – individuals, then PIE will be the easiest solution. The ease of PIE use is due of some main advantages:
– The funds arriving at the account are immediately at the expense of the entrepreneur, which he or she can freely spend.
You don`t need to pay a dividend tax. Once someone has paid you for the services or products, these funds are immediately available for cash withdrawal or payment by a bank card, settlement in the restaurant etc. While the company’s funds are the money-based businesses and can not be freely used, all the costs must be certified by accounting documents, and if the founder wants to receive dividends, then, in fact, he will pay a double tax – firstly, a profit tax (or a single tax ) And, secondly, – a dividend tax. While the PIE will pay only once the income tax (or a single tax) from the received funds and, accordingly, there is no obligation to pay a dividend tax, because these funds are becoming immediately his personal funds.
– Simplified accounting system and single tax
An enterprise can also operate on a single tax system. But along with other benefits, in combination – this is a key advantage.
– PIE may not pay him-/herself a salary.
According to the labor legislation of Ukraine, any person cannot carry out a work activity free of charge. Thus, even after registration of LLC with one employee – a director –the founder must pay salary himself. It greatly complicates the business activity, as it requires monthly payment of taxes on salary and monthly tax returns. Accordingly, PIE does not pay all this salaries monthly, but although he or she pays a single social contribution according to the minimum salary. Private Enterprise (PE)
The advantages of a private enterprise are:
– Flexibility of the legislation governing the activities of the PE
A private company is not well regulated as an LLC; that’s why, it is possible to provide for other provisions in the charter of a private enterprise, for example, another quorum order, decision-making, etc.
– Limitation of the founders’ liability
It is actually the same as for LLC, but the founders are responsible for the obligations of the PP only within the limits of the authorized fund. The founders of the PE can be several natural persons or one legal entity.
– The theoretical possibility to carry out the activities of the director without paying salary
Legislation does not provide for such a possibility, to carry out the work without salary. However, there is most often only one owner in a private enterprise (i.e. PE is usually a legal entity with one founder, which is called the owner), and in practice, quite often, owner does not pay him-/herself the salary as a director and there are no fines imposed on it.
Nevertheless, the majority of foreign founders choose LLC as a simplier form of business activity.
Foreign Representation
Foreign representation has many advantages:
– Simplification of immigration for workers (visa support and special cards for foreign employees working in Ukraine);
– Simplification of the currency control and return of proceeds to the founders of the representation; the direct opportunities to transfer funds to an account of foreign companies, to conduct activities on its behalf, currency earnings are not subject to mandatory conversion in UAH.
Nevertheless, there are many reasons why the foreign representation is rarely registered:
– Total cost
The registration of a foreign representative will cost about $5,000 to the company (including a $2500 state fee, legal support, notarial services and translations).
– The term
The term registration of foreign representation about two months. The LLC can be registered within 2-3 days. Registration of foreign representation is carried out through the Ministry of Economy of Ukraine, only in Kyiv. At the same time, when a foreigner wants to establish a business in Lviv, then he will need to hire the lawyers in Kiev.
– Complexity, lack of specialists
There are few lawyers and accountants who can skillfully support the foreign representation, since this form is used occasionally. Therefore, the majority of foreigners still use the LLC.
Joint venture is a different form of production and economic activity partners of several countries, which is based on the combination of efforts, financial resources, material resources, long-term guarantees of goods sales, systematic product upgrades, scientific and production and trade cooperation, participation in profits, distribution of technical and investment risks.
Today, the joint venture of partners from different countries is one of the most effective forms of world economic relations and often the creation of a production or other enterprise in a country involves both national and foreign capital. The essence of the joint venture is to combine capital owned by both private individuals and enterprises of different subordination.
The advantages of a joint venture are accompanied by a minimal cost of production and circulation, an increase in the rate of turnover of capital, which leads to increased profits, expands the possibility of accumulation of capital.
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Наші спеціалісти нададуть професійну консультацію.
An enterprise with foreign investments (FDI) is an enterprise (organization) of any organizational and legal form established accoding to in accordance with the legislation of Ukraine, foreign investment in its statutory fund, at its own discretion, is at least 10%. The enterprise gains the status of an enterprise with foreign investments from the date of foreign investment into its balance sheet (according to Article 116 of the Commercial Code of Ukraine).
One type of enterprise with foreign investment is the joint venture described above. It is important that an enterprise with foreign investments can also be used when it comes to an enterprise where 100% of its authorized capital is foreign capital.
The main advantage of an enterprise with foreign investments lies in the following: the products are not subject to licensing and quotas in the presence of certificates of origin of the product. If the joint venture products are subject to a special export regime, then the export of the product abroad is governed by the relevant legal documents. Limited Liability Company (LLC).
LLC is the most often choosen organizational-legal form. Information about LLC is presented in the form of a plaque, since very often the founders choose between the PIE and the LLC, so we will make the following comparison:
LLC has a legal status of a business partnership (Paragraph 1 of Article 50 of the Law of Ukraine “On Business Associations”) and is an entrepreneurial society (clause 1 of Article 84 of the Civil Code of Ukraine). A legal entity is considered to be created from the date of its state registration (Part 4 of Article 87 of the Civil Code of Ukraine). In addition, LLC is a legal entity of private law (Paragraph 2 of Part 2 of Article 81 of the Civil Code of Ukraine).
A citizen is recognized as a business entity in the event that he/she carries out the business activity on the condition of state registration as an entrepreneur without the status of a legal entity (Article 128, Article 58 of the Civil Code). A natural person has the right to engage him-/herself in the entrepreneurial activity after the state registration (Part 1 of Article 50 of the Civil Code). Prior to the activity of a private limited company as an entrepreneur, the rules of law regulating the business activity of legal entities are applied as entrepreneurs, unless otherwise provided by the substance of the relationship or not established by law.
The number of founders
The number of participants (founders) of a limited liability company (LLC) can be from 1 to 100 persons, among which may be both individuals and business associations, enterprises, institutions, organizations (Article 3, Article 50 of the Law “On Business Associations”, Clause 1 of article 140, Part 2 of Article 141 of the Civil Code of Ukraine).
Ukraine`s legislation doesn`t know a concept such as a founder (participant) exist in relation to an individual entrepreneur, but if it were possible to postpone the concept to the PIE, it would be only one founder and only an individual with full civil capacity (Part 1 of Article 128 CCU).
Activities
LLC carries out all types of entrepreneurial activity, in addition to the restrictions that apply to general restrictions on business activity, defined in Article 4 of the Law on Entrepreneurship, and this activity is related to: the circulation of psychotropic substances, narcotic drugs, their analogues and precursors; with the protection of certain particularly important objects of state property rights; with the production of gasoline motor blends or with the addition of bioethanol; with the production of bioethanol.
According to Part 5, Article 128 of the Civil Code of Ukraine, an entrepreneur-citizen has the right exercising activity in accordance, may independently carry out any work, at its own discretion, making the appropriate decisions, to meet the market needs that do not contradict the current legislation. According to Article 3 of the Civil Code of Ukraine, in the broad sense of economic activity, it is determined that entities may manufacture and sell products, provide services or perform costly works of value with certainty. That is, PIEs can perform practically all kinds of activities, but as always, there are certain limitations: firstly, this is a restriction as for LLCs and PPs, and secondly, individuals-entrepreneurs, in particular, cannot – in relation to television and radio broadcasting, in the field of operations with scrap metal, space activities etc.
Name
According to Article 90 of the Civil Code, a legal entity has its name, which contains information about its organizational and legal form. The name, together with the organizational legal form of a legal entity, is indicated in statutory documents, which are collectively the name, entered into the UES of legal entities, individuals-entrepreneurs and public formations. The name does not allow the use of full or shortened names of state authorities (paragraph 1.7 of the order of the Ministry of Justice №368/5 of 05/03/2012).
The name of PIE is only in one variant – it is the last name, first name and patronymic of the entrepreneur, so the name looks like this: “A natural person-entrepreneur Ivanov Ivan Ivanovich). A PIE may register a trademark in its name and use in its business activities.
Place of registration
The location of a limited liability company is the address of the body or persons who, according to statutory documents or law, represent it (paragraph 6, clause 1, Article 1 of the Law “On State Registration of Legal Entities, Natural Persons-Entrepreneurs and Public Associations”). The legal address may be an office non-residential premises, or the place of registration of one of the founders, as well as even residential premises (it doesn`t have restrictions on a residential or non-residential fund).
The location only can be the address of the registration of the individual entrepreneur.
Authorized capital amount
The authorized capital amount consists of the contributions from its members. The size of the authorized capital amount equals the sum of the value of such deposits. The charter capital of the company defines the minimum size of the company’s property, which guarantees the interests of its creditors. The minimum amount of funds deposited in the authorized capital may amount to UAH 1, but it must be taken into account that if the company has a director, an accountant, other employees who are required to pay salaries and taxes, then it is worth putting in the authorized capital the necessary amount to cover these expenses at the beginning of the activity. In the authorized capital can also make property (movable and immovable), valuation of such property held by the participants themselves.
According to the current legislation, there is not such thing as a chartered capital for PIE. The PIE is responsible within the limits of all its property belonging to it on the right of ownership, as individuals.
Requirements to the director and obligations of the director
Any company in Ukraine shall have a director who carries out the managerial functions and is its hired employee. The founders cannot manage the legal entity directly. A director, as a hired employee, may be a citizen of Ukraine, a person holding a permanent residence permit in Ukraine or a foreigner who has received a work permit.
One of the reasons for obtaining a work permit is the need to take a leading position in his own firm. Therefore, the foreigner who is the founder of a Ukrainian company may receive a work permit, but this requires a certain amount of time during which another person must perform the duties of the director in the company.
The PIE carries out its activities personally, through employees and contractors, so accordingly, PIE does not have requirements to its organizational structure.
Cash withdrawal
The company can use the company’s funds only to cover the expenses of the company. Thus, for the founders to receive a share of the profits from their company, such a company must pay them dividends, which will be taxed additionally.
The PIE may freely use all funds received by it for the account for any own needs, including cash withdrawal.
is a tax system used in most countries of the world. The main duty of LLC is the payment of income tax at a rate of 18%.
The specified taxation system is suitable for enterprises, whose documented costs are large, that’s way the profit before taxation decreases. The downside of an enterprise in the general tax system is that reporting is somewhat more complex, and the company is required to document the costs. Practice shows that tax should be at least 1% of the total income of an enterprise per year.
Simplified tax system
Business entities that use the simplified taxation, accounting and reporting system are divided into four groups of single tax payers. The LLC can be in the 3rd group of taxation. This group has restrictions on the turnover of funds. They make no more than UAH 5 million in a year.
Tax rate – 5% of income in the case of VAT included in the EP, 3% – in the case of VAT separately. The specified taxation system is advantageous at small expenses of the company.
A table of taxpayers groups of the simplified taxation system is shown below.
1st group
2nd group
3rd group
4th group
Within the limits of up to 10 percent of the subsistence minimum (able-bodied person), that is, up to UAH 160,00.
In the range up to 20 per cent of the minimum wage, or up to 640.00 UAH.
02) 5% – the third group (used by non-payers of VAT).
One hectare of agricultural land and / or land of a water fund depends on the category (type) of land, their location and is (as a percentage of the tax base).
Value added tax (VAT)
The VAT payer must necessarily register as the company with the total amount from the operation of the supply of goods/services subject to taxation, including using a local or global computer network, accrued (paid) to such person during the last 12 calendar months, in aggregate 1 million UAH (excluding value added tax).
If persons who are not registered as taxpayers but import goods into the customs territory of Ukraine in amounts subject to taxation in accordance with the law, such persons pay a tax during the customs clearance of goods without registration as tax payers.
If the contractors of the company are VAT`s payers, then companies should also register with the VAT payer.
The chosen tax system affects the following aspects:
1. Tax burden of the company – the amount of taxes.
2. The qualifications of accountants and the number of accounting, consequently, the remuneration of employees, the amount of personal income tax.
3. The degree of risk of errors in accounting and reporting complexity, and accordingly the size of penalties Stage 3. Preparation for the registration of LLC as the most widespread enterprise (aspects of management, requirements to statutory documents of LLC, requirements to a limited liability company) 1. Management of the company
The management of the LLC is carried out by the General Meeting of the founders (the founders’ meeting). The executive body is the Director, and the General Meeting of Founders is the highest governing body of the company. The founder`s meeting has the right to make decisions on all issues of the company’s activities, including those transferred by the Founders’ Meeting to the competence of other bodies of the company. The LLC may consist of one founder.2. Requirements to the statutory documents of LLC
Constituent documents include a statute that shall contain: the purpose and the subject of the company’s activity, the legal status, the rights and obligations of the partnership, the members of the partnership, the rights and obligations of the participants, the acceptance of a new participant in the partnership, the exclusion of the participant from the partnership, the exit of the participant from the partnership, authorized capital of the company and participants’ contributions, the composition and competence of the company’s bodies and the procedure for their adoption, the company’s property, distribution of profits and losses, accounting and reporting, foreign economic company activity, commercial secret of the company. The Model Statute is a standard constituent document approved by the Cabinet of Ministers of Ukraine Decree, specifying the procedure for the formation, the activity of the partnership, the management bodies of the company and the procedure for their adoption, the procedure for reorganization and liquidation. In the statute developed by our company, we will take into account your wishes and all possible risks not provided by the model statute. Particular attention is paid to the subject and objectives of the company, the composition of the members, the size of the authorized capital, the procedure for distributing losses and profits, the composition and competence of the organs of the LLC, the procedure for signing the constituent documents (statute), the inclusion of a list of issues requiring a qualified majority of votes and the procedure for reorganization and liquidation of the company. All mentioned issues, and a number of others, we include in the statute, thus minimizing risks in each case. 3. Registration card
The registration card is submitted to the state registrar at the registration, which states the information about the founders, the classification of economic activities, the name of the OLF. That is all information that will be reflected in the Unified Register of Legal Entities, Individual Entrepreneurs and Public Associations.
Samples:
1. Registration card;
2. Filled registration card.
4. Requirements to the name of LLC
The name of the Limited Liability Company shall contain the information concerning its legal form and name. The legal form of a legal entity in our case is LLC. The name of the legal entity consists of the proper name of the legal entity, as well as contains information on the purpose of the activity, type, mode of formation, legal entity’s dependence and other information in accordance with the requirements for the name of certain organizational and legal forms of legal entities established by the Commercial Code of Ukraine, the Civil Code of Ukraine, and the laws of Ukraine. A legal entity may have a shortened name, inn addition to the the full name. The name is given in the state language and available in English.
There are also a number of restrictions to the name of legal entities. Some of them cannot contain a link to the legal form and may not have the same denomination as another legal entity already registered. In the name of legal entities it is prohibited to use: full or abbreviated names of state authorities or local self-government bodies, or derived from these names, or historical state names, the list of which is established by the Cabinet of Ministers of Ukraine, – in the names of legal entities of private law. Terms, abbreviations, derivative terms, the prohibition of which is provided by the laws of Ukraine, symbols of the communist and/or national-socialist (Nazi) totalitarian regimes..
The name of the separated unit shall contain the words “separated subdivision” (“branch”, “representation”, etc.) and indicate the affiliation with the legal entity that created the separated subdivision.
5. Types of activities.
The LLC may carry out any kind of activities provided for by the Classifier of Economic Activities (hereinafter referred to as the CESR). You can specify an unlimited number of them, the main thing is to indicate which one will be the main one, and they will coincide with the types stipulated in the Statute. There are only a few restrictions related to general limits on the conduct of entrepreneurial activity, this activity is related to: the circulation of psychotropic substances, narcotic drugs, their analogues and precursors; with the protection of certain particularly important objects of state property rights; with the production of gasoline motor blends or with the addition of bioethanol; with the production of bioethanol and others.
6. The size of the authorized capital and the term of its introduction. Consequences of non-delivery
The charter capital of the LLC shall consist of the contributions of its members, which shall be made by all of them. In accordance with the current legislation, the amount of the authorized capital equals the sum of the value of their deposits. Regarding the size of the authorized capital, it is only foreseen that it should guarantee the interests of its creditors, consequently, it can be even as much as 1 UAH, the contributions to be made by all the founders. It is impossible to dismiss a participant of LLC from making a contribution to the charter capital of the company, including by listing the requirements to the company. The term for which the capital shall be paid is one year from the date of registration. If the authorized capital was not introduced, for any reason, the general meeting takes one of the following decisions: the exclusion of the participants from a partnership who have not made their shares, a reduction of the authorized capital, and redistribution of shares in the authorized capital or liquidation of the company. Any of the above-mentioned changes are subject to the state registration. Any changes related to the alterations in the authorized capital, with its decrease, in particular, must be communicated to all the company’s lenders no later than three days from the date of its adoption. In turn, lenders have the right to demand early termination or fulfillment of the relevant obligations of the company and reimbursement of losses. However, an increase in the authorized capital of a limited liability company is allowed after all contributions from its participants have been made in full. The votes of the participants of the LLC are distributed in proportion to their contributions.
7. The number of founders. Requirements to the founders
The founders of the Limited Liability Company may be both natural and legal persons (residents and non-residents). They can range from 1 to 100 people. However, LLC cannot have as a single participant another economic partnership with which one person is a participant. A person may be a member of only one LLC that has one participant. If the number of founders exceeds 100 persons, LLC is obliged to re-register in the JSC during one year, and if not, it is subject to liquidation by court. 8. Director, requirements for a director in LLC, limitation of director’s activities and financial control
The executive body of the LLC is a collegial body (directorate) or an individual (director). The Directorate is headed by the Director General. Below we will indicate just the director, which means both the director and the directorate. The director solves all issues of the company’s activities, except those that fall under the exclusive competence of the general meeting. The Director acts on behalf of the company within the framework of constituent documents and statutory norms, and is also accountable to the general meeting of participants. The Director General may perform actions on behalf of the company without a power of proxy. Other members may be endowed with the same right. The general director (director) cannot be simultaneously the chairman of the general meeting of participants.
The activities of the director are supervised by the audit committee, which is formed from the general meeting of participants, in the number of not less than three persons. Accordingly, the members of the directorate (director) cannot be the members of the audit committee. The Audit Commission verifies the activities of the Directorate (Director) at the request of the members of the Society, on behalf of the meeting or on its own initiative. The Commission has the right to request submission of all necessary materials, personal explanations, accounting or other documents. The Audit Commission reports the results of its audits to the highest body of the company, and makes an opinion on the annual reports and balance sheets, without which the general meeting of the members of the company is not entitled to approve the company’s balance sheet.
As to the above-mentioned provisions regarding the financial controlling of the director, the situation in practice is slightly different, since the powers of the director can be limited in the statute (mentioning it in the registration card, which will be reflected in the USR). These restrictions may apply to the conclusion of contracts for significant amounts, mortgages, loans etc. One more limitation is the obligation to add an additional signature to one or more founders on all contracts.
In practice, the issue of financial control is generally agreed upon by a bank and an accountant, and is regulated through client-bank systems, bank security systems or electronic digital signatures, etc. 9. Seal of LLC
The need for a seal is optional, which makes it simpler many aspects, such as the certification of documents only by the signature of the director, or the opening of a bank account etc. Stage 4. Procedure and stages of the registration of LLC (as the most common form of business) Preparation of documents is made up for 5 business days, after that you can proceed to the registration of LLC by the state registrar. On the same day, the information is entered in the Unified Register of Legal Entities, Individuals-Entrepreneurs and Public Formations Registration. Within 24 hours from the moment of registration with the State Fiscal Service and the Pension Fund, the state registrar issues one copy of the statute with a mark to the applicant and an extract from the establishment of the LLC. Since the receipt of the identification code of the legal entity (code – EDRPOU) – you can make a seal. Opening an account in a bank will take from 1 to 3 days, depending on the bank itself.
1. Direct registration of LLC
Registration of the LLC is carried out through the submission of a set of documents to the Center for the provision of administrative services, which transmit them to the state registrar or through a notary, which is authorized by the state registrar. Registration in the state registrar is carried out free of charge, at the same time as the notary. But if you want to avoid queues and save time, it’s faster to register with a notary public.
A number of documents shall be submitted to the registrar:
1. A completed registration card of Form 1 for the registration of LLC.
2. An original or a certified copy of the decision of the founders about the creation of LLC. In most cases, such a decision is made by the protocol of the general meeting.
3. Two originals of the statute. For convenience, and in order to avoid problems in some regulatory bodies, we recommend the signatures of the founders to be notarially certified in the statute, although there are no respective legislative requirements.
After receiving the documents, the state registrar gives the applicant a description with the list of received documents and the date of their receipt. The relevant set of documents to the state registrar can be filed both personally by the applicant and on the power of proxy by our employees, when the personal presence is optional.
Opening an account for LLC
Today, the banking market has a large number of banking institutions and their branches offering a wide range of services to their clients. When you choose a bank, it is necessary to take into account some factors, namely: 1. Property and reputation of the bank. First of all, you need to get acquainted with reviews of the bank on specialized websites and online forums. It is worth asking the ratings of the bank from international and national rating agencies. The most reliable banks with a rating of uaA, a rating below uaBBB already imply certain risks. Such information is available on the website of the Ministry of Finance of Ukraine. 2. Convenience of working with the bank. It is important that the bank has got a clear and accessible site, on which you can perform a wide range of banking operations without interrupting the business, convenient location, namely the availability of a wide branch network, high level of service, affordable cost of services.There are some documents that you need to submit to the bank:
1. Application for the opening of a current account, signed by the person authorized to open an account by the founders (participants) of the newly created legal entity.
2. One copy of the original of the constituent document or its copy notarized.
3. A card with the specimen signatures and the seal stamp (if available) notarized.
This list of the documents shall be submitted to the bank of your choice. Depending on the bank, you will be able to get an account with all necessary bank details in the term from 1 to 3 working days.
An account may be effected for a power of proxy issued on behalf of the person who has the right to open and dispose of the account, certified notarially. If the account is opened personally by the founder (participant), then this document is not to be submitted.
Features of converting currencies when they arrive at the account of LLC
When the currency is transferred to the account of LLC, according to the current legislation, 50% of the funds in mandatory order is subject to sale by the bank automatically. Such a conversion depends on the purpose of the payment, for example, the authorized capital is not converted. If you want to sell the currency yourself, today, you can do it with client. Aspects of registration of LLC by a non-resident (foreign):
For a non-resident, the procedure is more complicated and longer, including a number of the following nuances:
1) 1.1. Documents required from foreigners for registration of LLC (except for the above-mentioned):
– It is necessary to elaborate the Taxpayer Identification Number for a non-resident in the State Fiscal Service. Term – 10 days;
– It is mandatory to make a copy of the founder’s passport (the passport shall be translated into Ukrainian, the translator’s signature to be notarized);
– All documents not issued in Ukraine shall be translated into Ukrainian, the translator’s signature to be notarized.
1.2. Registration of LLC by a non-resident legal entity
One of the steps when registering a LLC by a non-resident legal entity is the requirement to appositize all documents relating to the legal entity of a non-resident. That is, the documents of a non-resident company, such as the Statement, are subject to the Apostille.
– Previously, thehre was a norm in the law concerning the mandatory disclosure of beneficiaries, by submitting to the registrar documents foreseen by the passports of such persons. For the time being, the procedure indicated is simplified, since such documents are not required, except for the passport data in the registration card.
2) A work permit shall be issued if the non-resident holds the position of a Director. Documents to be submitted for issuance of a permit are as follows: an application, 2 photos – 3.5 x 4.5, translation of the passport (notarized), documents on education, medical certificate, certificate of the absence of conviction, certificate of state secret; if a management position, then the constituent documents, an employment contract). Such a permission is made for a maximum of 1.5 months.
3) Possibility of exemption from payment of state duty when entering into the authorized capital of the enterprise with foreign investments by a foreigner
According to Art. 18 of Chapter IV of the Law of Ukraine No. 93/96-VR of March 19, 1996 “On the regime of foreign investment”, the tax on property imported into Ukraine as a contribution of a foreign investor to the authorized capital of enterprises with foreign investments (except for goods for sale or use for the purpose, not directly related to the conduct of entrepreneurial activity), shall be carried out in accordance with the procedure established by the Customs Code of Ukraine. Accordingly, Part 2 of Art. 287 CCU stipulates that goods (except for goods for sale or use for purposes not directly related with the conduct of entrepreneurial activity), imported into the customs territory of Ukraine for a term of at least three years by foreign investors as a contribution of a foreign investor to the authorized capital of an enterprise with foreign investments, are exempted from payment of import duties.
It is important that upon the alienation of the property imported into Ukraine as a contribution of a foreign investor to the authorized capital of enterprises with foreign investments, before three years from the time of its transfer to the balance, the import duty is paid on general grounds.
3) Ability to receive permanent residence based on a foreign investment.
The right to obtain an immigration permit is granted to persons who have made a foreign investment in the economy of the country in a foreign convertible currency for a sum not less than one hundred thousand dollars, registered in the manner prescribed by the Cabinet of Ministers of Ukraine. For more information, please refer to the article by our company.
4) Under the current Tax Code, a non-resident can not be a payer of the EP and business entities – a legal entity, a non-resident in the authorized capital of which the aggregate of shares belonging to non-payers of a single tax is equal to or exceeds 25 percent.
STEP 4. Obtaining the permissions and licenses for some activities of the enterprise
A wide range of economic activities is subject to licensing – banking, financial services, activities in the field of television, production and trade of alcoholic beverages, production of medicines and others. (Exhaustive list of links, article 7)
The names of certain types of activities in the law are quite general. In this case, you need to get acquainted with the licensing conditions for the activities of such types, which often indicate which transactions, works and services belong to the type of business subject to licensing. If your activity is listed below, then the necessary condition for the legality of entering the market is the obtaining of a license for this type of activity. If you want to run several types of business, then you must get the appropriate number of licenses – for each type separately.
For the consultations on the selection of the structure of the company, the choice of the organizational and legal form, the tax system, the preparation of documents for registration of LLC, contact by phone +380960020100, e-mail: [email protected]
