The State Tax Service Tracks Payments

The State Tax Service Tracks Payments

1. How the STS tracks payments through financial companies
   The State Tax Service (STS) of Ukraine receives data on money transfers via financial companies. All non-bank financial institutions must report every transaction, including the recipient’s details. Thus, the tax authority has full access to transfer information and can identify individuals who regularly receive funds.
2. Lack of business registration: how the STS finds out about such payments
   If a private individual frequently receives payments (e.g., for selling goods via Nova Poshta), this data is automatically transmitted to the STS through the fiscal receipt system. The STS analyzes these transfers and can identify those conducting regular business activities without registering as a sole proprietor or business entity.
3. What does “systematic activity” mean in business?
   According to Part 1, Article 42 of Ukraine’s Commercial Code, entrepreneurship is independent, proactive, and systematic activity aimed at earning profit.
   “Systematic” means repeated actions for profit. The law doesn’t define an exact number, but court practice (Resolution of the Plenum of the Supreme Court of Ukraine from 25.04.2003 No. 3) defines:
   An activity performed at least three times in a calendar year is considered systematic and qualifies as business.
4. Liability and fines for unregistered business activity
   According to Article 164 of the Code on Administrative Offenses:

• Fine from UAH 17,000 to 34,000, with possible confiscation of goods, equipment, or money earned from the offense;
• Repeat offense within a year — fine from UAH 34,000 to 85,000 with mandatory confiscation.

1. Appealing a fine
   STS fines can be appealed administratively (within the tax authority) or in court. A complaint must be submitted within 10 days, and the STS must consider it within 20 days. If unsatisfied, the individual may file a lawsuit in administrative court within 6 months.
2. Important notes

• One-time sale of personal used items is not considered business and is not taxed.
• Repeated sales, even of used goods, are taxable and may lead to penalties.
• The STS recommends registering officially and using certified cash registers (RRO/PRRO).

Conclusion:
If someone conducts three or more sales through NovaPay/Nova Poshta without registering as a sole proprietor, the STS has legal grounds to consider this business activity, calculate taxes, and impose fines. These fines can be challenged.

If you’ve encountered similar situations — it’s worth discussing them in advance. Often, one timely consultation can prevent a host of problems.
WINNER LAW FIRM is one of Ukraine’s leading firms in tax, criminal, administrative, commercial law, and litigation.
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