Family FOP under the crosshairs of financial monitoring: how the marriage business of FOP is considered as a separation, the lawyer explains.

Small business Photo: Informator

Family FOPs came under the close control of the DPS. Taxpayers send letters to FOP-spouses with a warning about the breakdown of the business and are invited to consultations. Lawyer Bohdan Yankiv explains by what criteria DPS and financial monitoring of banks identify illegal fragmentation, what consequences may arise and how to analyze your business for risks.

Why was the tax office interested in FOP-spouses

“Recently, the State Tax Service and bank financial monitoring have increased efforts to identify the so-called “fragmentation of business” with the help of several FOPs from the same family,” Bohdan Yankiv notes.

In fact, entrepreneurs began to receive:

• Letters to e-mail with informational notifications about signs of business breakdown
• Invitation to the tax office for individual conversations and explanations

“If it is not an official request (without the original number of the document, without the requirement to provide an explanation in accordance with the PKU), then it is not necessary to respond. It is only an informational message. But it is important to check your business for signs of fragmentation in order to prevent problems in the future,” says Bohdan Yankiv.

When family FOP is a common practice, and when it is a division The lawyer emphasizes: the mere fact that the husband and wife have the status of FOP is not a crime.

Legitimate situation: the husband issued a FOP in 2020, is engaged in restoring equipment, and the wife issued a FOP in 2023, opened a clothing store. They carry out different types of activities, have different customers, separate points of sale. This is completely legal. The family has the right to entrepreneurship of several members.

Illegal situation (fragmentation): the husband of the FOP in group 3 is approaching the limit (10,091,049 UAH for 2026), and in order not to switch to the general system, he registers the wife of the FOP. The wife actually works for the same business: same store, same products, same website. Profits from buyers are shared between the two FOPs. This is an illegal fragmentation of business in order to avoid paying taxes, the lawyer emphasizes.

7 signs of business fragmentation: what the tax office investigates In the letter dated November 1, 2024 No. 25-0005/82615, the National Bank established the criteria by which financial organizations and the tax authority identify related parties and business divisions.

Feature 1: Joint founders and managers What is researched:

• Whether one FOP acts as the founder or manager of an LLC where another FOP operates
• Are there family ties between the FOP and the directors of legal entities-counterparts
• Whether one manager actually controls several entities

An example of a violation: The man is a FOP in the 3rd group. The wife is the director of the LLC. The FOP continuously provides services to this LLC, and the LLC pays significant amounts to the FOP. At the same time, there are no other customers in the FOP.

Legal option: The husband is a freelancer, is engaged in web design, cooperates with many customers. The wife is the director of an LLC engaged in accounting. They work in different industries and have different clients.

Sign 2: A single address for the sale of products What is researched:

• Do both FOPs work from the same point of sale
• Do they use the same online resource for sales?
• Or one shop/office/warehouse for both

An example of a violation: Husband and wife are both FOP. They work in the same store at the same address. They sell the same goods (clothes). Only part of the checks are made to one FOP, part to another, so as not to exceed the limit volume.

Legal option: The husband is a sole trader, owns a tool shop on the street. Shevchenko. The wife is a sole trader, owns a perfume shop on the street. Victory (other address). Different places of trade, different goods.

Feature 3: Sharing of resources What is researched:

• Common office/warehouse for all FOPs
• General accounting
• Shared equipment (computers, machines, transport)
• The same employees

An example of a violation: Two FOP (brother and sister) repair cars. They work in the same service station, use the same equipment, the same tools. The client doesn’t care which FOP to issue, they just divide it for the limit.

Legal option: My brother is a general contractor, specializes in engine restoration, and has his own service station with equipment. The sister is a FOP, specializes in body repair, has her own workshop with other equipment. Different services, excellent equipment, different premises.