Mistakenly paid tax to another account: tax authority explains whether fines and penalties apply

If a taxpayer mistakenly transferred funds to another budget account, they may be released from financial liability for such an error. However, to do so, it is necessary to comply with the conditions defined by the Tax Code of Ukraine, in particular to submit an application for the return of funds.

This was reported by the State Tax Service.

When a taxpayer is released from financial liability

Erroneous payment of a monetary obligation to another budget account is a circumstance that releases a taxpayer, in particular a tax agent, from financial liability for tax offenses and violations of other legislation, control over compliance with which is entrusted to the controlling bodies.

At the same time, this rule applies provided that the payer has not violated the legally established deadline for payment of the tax or the agreed amount of the monetary obligation to the budget.

To confirm this circumstance, the payer must take measures to recover the erroneously paid funds.

Is a penalty charged for erroneous tax payment?

If a monetary obligation is transferred to an incorrect budget account, no penalty is charged. If it has already been charged, it is subject to annulment.

This rule also applies provided that the taxpayer has not violated the tax payment deadline or the agreed monetary obligation established by law and has taken measures to return the erroneously transferred funds.

How to get back mistakenly paid funds

A mandatory condition for the return of the amounts of the monetary obligation and the penalty is the submission by the taxpayer of a corresponding application.

The exception is excessively withheld or paid amounts of personal income tax. These are returned by the controlling authority on the basis of a tax declaration on property status and income submitted by the taxpayer for the reporting calendar year after recalculation of the total annual taxable income.

An application for the return of erroneously and/or overpaid funds and penalties must be submitted within 1095 days from the day such overpayment arose.

Recall that Finance.ua previously reported that the Verkhovna Rada adopted as a whole draft law No. 16037-d "On Amendments to the Tax Code of Ukraine Regarding the Simplification of Value Added Tax Administration." The draft law is aimed at simplifying VAT administration, developing electronic interaction between taxpayers and controlling authorities, and improving the procedure for preparing VAT tax reporting and tax invoices.