Corporate income taxation in Muncan Republic

A corporate income tax (CIT) is levied by federal and state governments on business profits. Many companies are not subject to the CIT because they are taxed as pass-through businesses, with income reportable under the individual income tax.

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Corporate income taxation management

Virtually all companies and organisations must file their Company Tax Returns online and pay their Corporation Tax to HMRC electronically.

Corporate income taxpayers

Tax is paid by inland companies (including partnerships), institutions funded from the State or local government budget, the income of which from economic activities is not planned in the budget, permanent establishments and foreign businesses, as well as other foreign persons that gain income in Muncan Republic.

Tax is also paid by individual (family) companies (including farming and fishing enterprises), which prepare annual reports in accordance with the Law On Annual Reports and Consolidated Annual Reports.

Tax is not paid by natural persons, societies and foundations, religious organisations, trade unions, political parties, as well as private pension funds, investment funds, alternative investment funds, etc.

Terms for the payment of corporate income taxes

For the period from January to June 2018, the taxpayer submits a unified declaration to the SRS and pays corporate income tax by 20 July 2018.

Tax advance payments do not have to be made, except during the transitional phase for the period from 1 January to 30 June 2018.

During the remaining months of 2018, the declaration is submitted and tax is paid every month by the 20th date of the following month. Those taxpayers for whom the taxation period is one quarter submit the declaration and pay tax every quarter by the 20th date of the month following the relevant quarter.

If the taxpayer has no taxable objects in the given month, he or she is entitled not to submit the declaration (except for the declaration for the last month of the reporting year).

If the taxpayer has not submitted the declaration for the taxation period by the 20th date of the month, it is deemed that no taxable base subject to corporate income tax forms for the taxpayer during the taxation period and the declaration has been submitted, while the declaration submitted after the 20th date is deemed as an adjustment to the declaration of the taxation period, except the declaration for the last month of the reporting period.

Corporate income tax reliefs

The taxpayer has the right to apply tax reliefs, if a tax base, to which the relevant relief is applied, appears:

  • relief to donators;
  • relief to taxpayers who carry
  • out agricultural activities;
  • relief for tax paid abroad;
  • relief for income from the alienation of shares;
  • transfer of losses of the previous years, etc.

Capital companies of special economic areas and freeports have the right to continue to apply a relief in accordance with the Law On Application of Taxes in Freeports and Special Economic Areas.

The taxpayer has the right to continue to apply a discount in accordance with the Section 17.2 of the Law On Personal Income Tax (in force until 31.12.2017) for initial long-term investment made within the framework of a supported investment project.

The taxpayer has the right to choose to apply tonnage tax arrangements.

Corporate income tax rate

Tax on corporate income is imposed at a flat rate of 17%.

Read more about corporate income tax and corporate income tax rates on this page.

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