Temporary ban on travel abroad of the director of an enterprise that has a tax debt: the procedure and grounds for application

20/ 01/ 2022

Author: Natalia Ponomarenko, Lawyer of Dynasty Law & Investment On the eve of the new year, legislators traditionally welcome business by amending the Tax Code of Ukraine. Law № 5600 has already caused a stir in the media, but now we want to dwell in detail on one innovation, which concerns the temporary restriction of the right of heads of debtor companies to travel abroad. In order for taxpayers to have the right to go to court to apply such a restriction, there must be a number of grounds: The tax debt must be indisputable. The taxpayer must be served with a tax claim, which is issued only in respect of the agreed obligations. That is, the tax notice issued by the tax authorities does not give the right to apply the restriction of departure; 240 days must pass from the date of service of the tax claim. Prior to the expiration of this period, recourse to the court under the ban is not provided; The amount of tax debt must exceed 1 million hryvnias. At the same time, the state should not have debts to the taxpayer. If the company, for example, has not received a budget refund of VAT, the amount that is greater than or equal to the amount of the companys debt, you can not apply a travel ban. The ban on the head of the enterprise going abroad is security-based and is applied by the court temporarily, until the debt is repaid. Information on persons who are prohibited from leaving will be published in the Register of Managers of Debtor Payers, which should be maintained by the tax authorities. So, if you are the head of a company that has unresolved tax issues - be careful not to cancel your vacation or business trip at the last minute due to the ban on travel abroad, and seek qualified legal assistance in a timely manner. Dynasty Law & Investment lawyers will definitely find an opportunity to solve your problem.

Author: Natalia Ponomarenko, Lawyer of Dynasty Law & Investment

On the eve of the new year, legislators traditionally “welcome” business by amending the Tax Code of Ukraine. Law № 5600 has already caused a stir in the media, but now we want to dwell in detail on one innovation, which concerns the temporary restriction of the right of heads of debtor companies to travel abroad.

In order for taxpayers to have the right to go to court to apply such a restriction, there must be a number of grounds:

The tax debt must be indisputable. The taxpayer must be served with a tax claim, which is issued only in respect of the agreed obligations. That is, the tax notice issued by the tax authorities does not give the right to apply the restriction of departure;
240 days must pass from the date of service of the tax claim. Prior to the expiration of this period, recourse to the court under the ban is not provided;
The amount of tax debt must exceed 1 million hryvnias. At the same time, the state should not have debts to the taxpayer. If the company, for example, has not received a budget refund of VAT, the amount that is greater than or equal to the amount of the company’s debt, you can not apply a travel ban.

The ban on the head of the enterprise going abroad is security-based and is applied by the court temporarily, until the debt is repaid. Information on persons who are prohibited from leaving will be published in the Register of Managers of Debtor Payers, which should be maintained by the tax authorities.

So, if you are the head of a company that has unresolved tax issues – be careful not to cancel your vacation or business trip at the last minute due to the ban on travel abroad, and seek qualified legal assistance in a timely manner.

Dynasty Law & Investment lawyers will definitely find an opportunity to solve your problem.