Is it necessary to file a report on CFC in the event of liquidation (dissolution) of a controlled company/loss of controller status?

A controlled foreign company (hereinafter referred to as CFC) is any legal entity registered in a foreign state or territory that is recognized as being under the control of an individual resident of Ukraine or a legal entity resident of Ukraine.

A controlling entity is an individual or legal entity resident of Ukraine that is the direct or indirect owner (controller) of a CFC.

In particular, a foreign company is recognized as a CFC if an individual resident of Ukraine or a legal entity resident of Ukraine:

a) owns a share in a foreign legal entity in the amount of more

than 50 percent, or

b) owns a share in a foreign legal entity in the amount of more

than 10 percent, provided that several individuals - residents of Ukraine and/or legal entities - residents of Ukraine own shares in a foreign legal entity, the amount of which in aggregate is 50 percent or more, or

c) individually or together with other residents of Ukraine - related persons exercises actual control over a foreign legal entity.

For the purposes of tax control over the taxation of CFC profits, the reporting (tax) period is the calendar year or another reporting period of the CFC ending during the calendar year.

Controlling entities are required to submit the Report on the CFC to the controlling body simultaneously with the submission of the annual declaration on property status and income or the tax declaration on corporate income tax for the relevant calendar year by electronic means in electronic form in compliance with the requirements of the laws of Ukraine “On Electronic Documents and Electronic Document Management” and “On Electronic Identification and Electronic Trust Services”.

The Report on the CFC must be accompanied by duly certified copies of the financial statements of the CFC, confirming the amount of the CFC’s profit for the reporting (tax) year.

There is a misconception that if the controlled company was liquidated by the end of the year, then there is no need to submit the CFC report.

However, the law regulates this situation differently, which was confirmed in the individual tax consultation of the State Tax Service of Ukraine (ITA of the State Tax Service of Ukraine dated 31.12.2025 No. 7010/ІПК/99-00-24-03-03).

The State Tax Service of Ukraine explains that the taxpayer - the controlling person, in the event of loss of control over the CFC during 2025, is obliged to submit to the regulatory authority the Report on the CFC for 2025 simultaneously with the submission of the annual declaration on property status and income for 2025 and copies of the financial statements of the CFC, confirming the amount of the CFC's profit in the reporting year 2025.

At the same time, the taxpayer independently determines the reporting period for preparing the financial statements of such a company, which may end both on the date of loss of the status of the controller, CFC, and at the end of the calendar year.

The legislation does not exempt from the obligation to submit a report if the reporting period ends earlier than the fiscal year, i.e. December 31.

The fine for failure to submit a report on CFC is 100 times the subsistence minimum for an able-bodied person, established by law as of January 1 of the tax (reporting) year (302,800 UAH for the report for 2025)