Law on simplified certificates of completed work: what it changes for business

The Law on Simplified Certificates of Completed Work is not just a “victory for deregulation” but a signal for businesses to review their contracts and approaches to primary documents. Adopted on the basis of Draft Law No. 14023, it amends Article 9 of the Law on Accounting and allows the parties to a contract to provide for a simplified procedure for documenting primary data when services are rendered, work is performed or assets are leased. It is not about abolishing primary documents but about flexibility: some customer details may become optional, and in certain cases an invoice signed by the contractor will replace a traditional certificate of completion.

Essence of the law: what requirements are simplified
The essence of the law is to reduce the administrative burden on business and simplify primary documentation without losing control. If this is expressly stated in the contract, a document may contain only the contractor’s signature without the customer’s details. The law allows the parties to use a signed invoice instead of a certificate as a primary document for accounting and tax purposes, while businesses may still issue full certificates if they wish.

Limitations: where simplification does not work
The law is not universal: the simplified procedure does not apply to transactions funded from public money, leases of state or municipal property, construction contracts or design and survey work, all of which must still be documented by full certificates signed by both parties.
In addition, the simplified procedure is allowed only if several conditions are met at the same time:

• it is expressly set out in a written contract between the parties;
• services or work are fully paid for in non‑cash form (for the “single signature” option);
• business transactions are recorded in the accounts in the period when they actually occur.
  If at least one of these conditions is not met, it is safer to stay within the traditional model with a bilateral certificate.

Opportunities for business: where real savings arise
According to government estimates, abolishing the mandatory use of certificates of completed work and simplifying primary‑document details can save businesses up to 20 billion UAH a year by reducing time and administrative costs. In private‑sector practice this will mainly show up in the following ways:

• Less “certificate bureaucracy”. When there are many small services (marketing, IT support, SaaS, service rentals), there is no longer a need to chase signatures from several people on the customer’s side for each certificate.
• Faster period closing. If an invoice or certificate with the contractor’s signature plus payment provides the full set of primary‑document details, the accountant can close the month without waiting for the customer’s wet signature.
• Better alignment with international practice. In most EU countries an invoice is the basic document for confirming services, and the new approach brings Ukraine closer to this model, making life easier for companies working with non‑resident counterparties.
  However, these savings will be real only if lawyers, accountants and sales teams synchronise and clearly set out the new documentation rules in contracts and adjust internal processes to the invoice‑based model.

Risks for accountants: where problems may hide

• Contract non‑compliance with the law: if a single signature or invoice instead of a certificate is not expressly stated, the document may not be recognised as valid primary evidence.
• Disputes with counterparties: without the customer’s signature it is harder to prove the fact and volume of services in case of a conflict.
• VAT and corporate income tax risks: an improperly prepared “simplified” document may lead to disallowance of expenses or input VAT, so contracts and invoice/certificate details must be checked carefully.

What businesses should do now
To benefit from the new law and minimise risks, companies should take a systematic approach to the changes. Practical steps may include:

• Contract audit. Review standard service, work and lease contracts and clearly specify the chosen documentation format: bilateral certificate, certificate with a single contractor’s signature or invoice as the primary document.
• Updating primary‑document templates. Update certificate and invoice templates so that they contain all mandatory details (name, date, description and volume of the transaction, unit of measure, amount, party details and signature of the responsible person on the contractor’s side).
• Setting up electronic document flow. Where a business switches to invoices or single‑signature certificates, it is logical to strengthen electronic document management in parallel (qualified e‑signatures and services like M.E.Doc or others) to maintain a clear electronic audit trail.
• Internal policies. Define in the document‑flow policy when the company uses the simplified procedure and when it keeps to classic certificates with two signatures (for example, large amounts, long‑term contracts, high‑risk counterparties).
• Training for managers and sales. Often managers are the first to agree the form of documents with clients; without an understanding of the new rules it is easy to end up with a contract that contradicts the company’s internal policy.

Conclusions: simplification as a tool, not an end in itself
The law on simplified certificates is a useful deregulation tool, but it is not about “getting rid of certificates”; it raises the level of responsibility for the quality of contracts and primary documentation. The main risk is switching to simplification without clear contracts and internal policies, which may result in tax disputes and conflicts with counterparties. A well‑thought‑out strategy (updated contracts, templates, policies and electronic document flow) can turn the law into a real tool for process optimisation and cost savings.
If you have questions or issues related to applying the simplified procedure for documenting services, updating contracts or assessing tax risks, you should seek professional advice to analyse your situation and minimise possible consequences.
Author: Ihor Yasko, Managing Partner at Winner Law Firm, PhD in Law.