On taxes and other obligatory payments to the budget (Tax Code)

Article 230. Income from doubtful obligations

1. Obligations arising for purchased goods (works, services), as well as for assessed employees’ income determined in accordance with paragraph 1 of Article 322 of this Code, and not fulfilled within a three-year period calculated in accordance with paragraph 2 of this article, are recognized doubtful. Income from doubtful obligations for received credits (loans, microcredits) does not include the amount of the received credit (loan, microcredit).

The specified doubtful obligations are included in the taxpayer’s total annual income, except for VAT that is subject to exclusion from the offset in the manner specified in Section 10 of this Code.

2. Income from a doubtful obligation is recognized in a taxable period of expiration of a three-year period, which is calculated as follows:

1) for doubtful obligations that arose under credit (loan, microcredit) agreements - from the day following the day of maturity of remuneration in accordance with the terms of a credit (loan, microcredit) agreement;

2) for doubtful obligations that arose under lease agreements - from the day following the day of maturity of a lease payment in accordance with the terms of a lease agreement;

3) for doubtful obligations that arose with respect to accrued employment income - from the day of calculating employment income in accordance with paragraph 1 of Article 322 of this Code;

4) for doubtful obligations not specified in subparagraphs 1) - 3) of this paragraph:

from the day following the expiry date of an obligation for purchased goods (works, services), the deadline for which is fixed;

from the date of transfer of goods, performance of works, rendering of services under an obligation for purchased goods (works, services), the deadline for which is not fixed.

3. The provisions of this article shall not apply to interest on credits (loans) that is not deductible, with account of the provisions of paragraph 3 of Article 246 of this Code.