Oleksandr Pysarenko.

Especially for the Yuridicheskaya Praktika neswpaper.

In May 2000, due to the fact that private notary Elena Marmazovoy not been given an income tax return for the first quarter of 2000, the State Tax Inspectorate of the Shevchenko district of Kiev (hereinafter – STI) was made available to stop operations at its current account in The Superintendency of Banks “Ukraina”.

Subparagraph 14.4. paragraph 14 of the Regulations on Income Tax of citizens (hereafter – Instruction) approved by order of the Main State Tax Inspectorate of Ukraine on April 21, 1993 № 12 and registered with the Ministry of Justice on 9 June 1993 under number 64 (as amended), establishes that “citizens who are engaged in entrepreneurial activities on a quarterly basis, a 15-day period at the end of the quarter, submit to the tax authority of the Declaration, and after the end of the year – until February 1 next year … Specified conditions declaration shall also apply to private notaries, lawyers and systematically carry out independent professional activities. ”

Private notary Marmazova decision STI disagreed, believing that, in accordance with applicable law private notaries are required to file a quarterly declaration, and once a year, and appealed to the Shevchenko district court of Kiev with a complaint of 25 May 2000 on misconduct STI and STI to indicate the order lifted as unlawful, charged with the duty of the STI to resume operations in its bank account.

Interests of a private notary Marmazovoy EN at all stages of the proceedings of the case were represented by lawyers of the Legal Bureau of Pisarenko.

Substantiating his claims, defenders of private notary Marmazovoy EN in the complaint referred to the fact that:

– Firstly, in accordance with Article 92 of the Constitution the basic responsibilities of citizenship are determined exclusively by the laws of Ukraine;

– Secondly, in accordance with paragraph “b” part 1 of article 19 of Decree of the Cabinet of Ministers of Ukraine “On income tax from the citizens” (hereinafter – the Decree) of 26 December 1992 № 13-92 (as amended), which has By law, the obligation of citizens to file in cases envisaged by the decree of the tax authorities the income and expenditure;

– Thirdly, part 2 of Article 14 of the Decree stipulates that “taxation of individual income tax authorities on the basis of declarations of citizens of the expected (estimated) in the current year or the fact they have received during the year of income.” The exception to this rule referred to in Part 4 of Article 14 of Decree: “Citizens who are engaged in entrepreneurial activities on a quarterly basis, 15 days after the end of the quarter, submit to the tax authority of the Declaration, and after the end of the year – until February 1 next year”;

– Fourth, subparagraph 2 of paragraph 1 of Article 9 of the Law of Ukraine “On Taxation System” on June 25, 1991 № 1251-XII imposes duties of taxpayers” apply to state tax authorities … in accordance with the laws of the declaration, accounting … associated with the calculation and payment of taxes and duties … ”

The decree does not impose a charge for private notaries, as well as for those who regularly carry out independent professional activities on a quarterly basis to file financial disclosure statements, and the Ukrainian Constitution in Article 67 enshrines the obligation to annually submit declarations of their property status and income.

Lawyers Notary concluded that citizens (including private notaries) must submit a declaration of income annually. According to Articles 6, 19 of the Constitution, the tax authorities may exercise their powers only under and in accordance with the laws of Ukraine. Since the private lawyer, the law is not required to file quarterly disclosure statements, then the tax authorities was not and there is no reason to stop operations at its bank account.

Representatives of the STI complaint is acknowledged, noting that, according to the additions to the Regulations on Income Tax of citizens, private notaries must also submit financial disclosure statements on a quarterly basis, as are private entrepreneurs.

Refuting this, the lawyer the Legal Bureau of electric Anatoly Pisarenko, Ivchenko said that private notaries are not subjects of entrepreneurial activities and are excluded from the procedure for filing tax returns, fixed in part 4 of article 14 of Decree for entrepreneurs.

Judge Bujac Shevchenko District Court of Kiev has considered the complaint in open court. Having heard the explanations and justifications from both sides, having ascertained all the circumstances, the court July 4, 2000 adopted a decision on the complaint.

In its decision the court stated that the manual is a by-law and can not increase the number of businesses provided by the legislation of Ukraine. Article 3 of the Law “On Notary” generally prohibits private notaries engaged in entrepreneurial activities.

In turn, almost a year later, April 9, 2001 the Presidium of the Kyiv City Court, having considered the objection of Deputy Chairman of the Kiev city court decision, upheld the protest (hereinafter – the protest), and issued a decree of the Presidium of the Kyiv City Court on April 9, 2001 (hereinafter – Order), which reversed the decision and dismissed the complaint.

The ruling stated that the withdrawal of the Shevchenko district court of Kyiv that guide expands the range of businesses and is contrary to the Law of Ukraine “On Notary” can not be considered valid, since in this case, the instruction is a question of private notaries as individuals systematically carrying out independent professional activities rather than as subjects of entrepreneurial activity.

The court ignored the fact that the Ordinance does not impose duties of the quarterly declaration to persons who are systematically engaged in an independent professional activity, this responsibility only by private entrepreneurs.

The next step in legal battles was an appeal to the Supreme Court of Ukraine to the cassation appeal of the July 26, 2001.

In the appeal, it was stated first, that private notaries are not business entities, but are individuals who regularly exercise independent professional activity. Consequently, private notaries are obliged to declare their income in accordance with the rules established for the citizens of Ukraine – once a year.

Secondly, the appeal was stated that the existing legislation there is a conflict between the Ordinance and Regulations. Instruction sets for private notaries and persons regularly engaged independent professional activity, a new obligation, not foreseen in the Decree. This statement can not be applied because it is a by-law. And the public authorities, under Article 19 of the Constitution, must act only on grounds prescribed by laws of Ukraine rather than regulations.

5 February 2003 the Trial Chamber on Civil Cases of the Supreme Court of Ukraine as part of a presiding officer and seventeen judges put an end to the dispute and adopted the definition of case number 6 2702ks02, meeting the appeal of a private notary Marmazovoy Elena Nikolaevna, and annulled the decision of the Presidium of the Kyiv City Court on April 9, 2001, and upheld the decision of the Shevchenko district court of Kiev on July 4, 2000. This determination is final and not appealable.

PYSARENKO Oleksandr.