Every transaction under control: what notaries are obliged to report to the tax authorities
1 April 16:04
Notaries have been obliged to submit monthly detailed reports to the controlling authorities on all notarized contracts relating to the sale and purchase of movable and immovable property, donation and inheritance. This rule applies to both private and public notaries, regardless of their form of ownership, "Komersant Ukrainian" reports, citing information from the State Tax Service of Ukraine.
What kind of data should notaries submit
On a monthly basis, notaries are obliged to generate and send to the tax service data in the form of Annex 4DF, approved by the order of the Ministry of Finance of Ukraine No. 4 dated January 13, 2015.
The report must contain:
- type of certified document (sale and purchase agreement, gift deed, certificate of inheritance)
- parties to the agreement (full name, TIN of individuals involved in the transaction);
- the value of the property specified in the document;
- the amount of tax paid, if required by law;
- tax rate and tax benefits, if applicable;
- the parties’ place of residence and other information required by tax law.
This data is transferred electronically using a single electronic reporting window, which allows for automatic integration of information into the State Register of Individual Taxpayers (SRFT).
What is this information used for?
The information provided by notaries is not just a formality. It is actively used by tax authorities and other entities for a number of purposes:
- verification of the accuracy and completeness of tax charges, especially for personal income tax and military duty
- automatic substitution of data in income and property tax returns filed by citizens and civil servants;
- verification at the request of banks, notaries, social security authorities and other institutions when confirmation of the origin of property or income is required;
- use in financial monitoring systems and in the fight against money laundering.
Notaries as tax agents
According to the current tax legislation, notaries in such cases act as tax agents – persons who are obliged to ensure not only the withholding and transfer of taxes during certain transactions, but also the submission of relevant reports. Violation of these rules is equivalent to an administrative offense.
Liability for violations
If a notary fails to submit a report on time, provides incomplete or inaccurate information, or makes technical errors that result in the data not being recorded in the register, he or she is subject to financial sanctions:
- uAH 1020 for the first violation;
- uAH 2040 for a repeated similar violation within a year.
If a notary systematically fails to comply with the reporting requirements, the tax service may initiate an audit of its activities, including registration and financial documents. In some cases, it may be necessary to suspend notarial activities or revoke the certificate.
What it means for citizens
For citizens, this means that information about any formalized transactions and property rights will automatically be entered into state registers, including the tax base. This simplifies the filing of declarations, but also means increased control over income, in particular, income received as a result of the sale, gift or inheritance of property.
It is important to understand that if a notary fails to transfer information or makes a mistake, the tax authorities may not see this data, which means that a citizen may have problems when registering an inheritance, filing a tax return, or during financial audits.
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