Transfer pricing: Explanation from the tax service.

Tax audits of Ukrainians. Illustrations: YouControl

The State Fiscal Service has provided clarification on the main provisions regarding conducting inspections in the field compliance with the principle of “outstretched hand” in the field of transfer pricing. It is mainly about the terms of these inspections, the grounds for their initiation, as well as the possibility of changing the inspection period at the initiative of the tax payer.

What is an inspection based on the principle of “outstretched hand” Inspection of compliance with the principle of “outstretched hand” is a special type of fiscal control. Its task is to find out whether the conditions of regulated agreements are consistent with the level existing in the market. Such inspections are conducted in accordance with the Tax Code of Ukraine, taking into account the specialized rules of Article 39 and Regulation No. 344, which was approved by order of the Ministry of Finance of Ukraine.

A key feature: aspects of compliance with the principle of “outstretched hand” cannot be the object of a standard scheduled documentary inspection. The legislation allows their study exclusively within the framework of unscheduled documentary inspection.

In which cases the inspection is appointed The decision to carry out such an inspection is made by the head of the control body or a person authorized by him. It is fixed by a separate order and is based on clearly established grounds, which are specified in the Tax Code.

At the same time, the fiscal service has no right to conduct more than one inspection on compliance with the principle of “outstretched hand” during a calendar year in relation to one subject of tax payment. Re-inspections can be carried out only in exceptional situations, which are clearly provided for by law.

What is the duration of the inspection? The period of the inspection is counted from the day of the decision on its appointment to the day of drawing up the report or certificate based on the results. The main duration of such an inspection cannot be longer than 18 months.

At the same time, the legislation provides for the possibility of extending this period for up to 12 months, but only if there are objective circumstances. These include:

• the need to obtain information from foreign government bodies;
• carrying out an expert assessment;
• translation of documentation into Ukrainian.

It is specified separately that the course of the inspection term is suspended if the court examines the disputes of the taxpayer, which are related to the purpose or subject of such an inspection.

Is it possible to change the inspection period at the request of the payer One of the most frequent requests from businesses is the ability to adjust or extend the inspection period at will. The fiscal service provides a clear answer: the Tax Code of Ukraine does not provide for such an option. The inspection period is determined exclusively in the order on its conduct and cannot be extended at the initiative of the taxpayer.

Documents and information exchange The taxpayer is obliged to provide documents related to the subject of the inspection within 10 working days from the moment of its commencement. Representatives of the tax service have the right to request additional information, in particular, from other taxpayers or through competent institutions of foreign countries.

Documents can be provided both in printed form and in electronic format in compliance with the requirements of the legislation on the electronic circulation of documentation. At the same time, the obligation to keep transfer pricing documentation is at least 2,555 days.

The main conclusion Thus, the inspection of compliance with the principle of “outstretched hand” is a long and complex process with clearly established deadlines. Its usual duration is limited to 18 months, with a possible extension for another year in certain cases. The legislation does not allow making changes or extending the inspection period at the request of the taxpayer, and the actions of fiscal authorities must be carried out exclusively within the framework and in accordance with the method specified by law.

As informed by the Informant, the State Tax Service of Ukraine has published a plan-schedule for conducting documentary scheduled inspections of taxpayers for 2026. In total, tax officials planned to conduct 4,500 planned inspections.