The introduction of automatic exchange of tax information between Ukraine and other countries has sparked a wave of questions among citizens and businesses. Many fear that this will lead to mass audits. However, experts clarify: the exchange of data itself does not mean the automatic launch of tax investigations.
How the exchange mechanism works
According to tax consultant Alexandra Tomashevskaya, information exchange occurs only if a foreign financial institution has identified a Ukrainian specifically as a tax resident of Ukraine. This is a key point: if a person actually lives abroad, works there, has residence documents, and their children attend local schools, they may be considered a resident of another country—for example, Poland or Germany. In such a case, information about their accounts will not be transmitted to Ukraine.
Who will be affected by the exchange?
The exchange will affect those who live in Ukraine but have capital abroad and are identified as Ukrainian residents. In this case, the State Tax Service (STS) will receive data about accounts, real estate, or other assets and compare them with the information already available in its databases.
If it turns out that a person has not declared income—for example, they rented out an apartment abroad and received 10,000 euros—the tax authority may send a request demanding an explanation of the origin of these funds or offer to voluntarily declare them and pay taxes.
Risks for residents
Special attention is paid to the issue of tax residency. According to experts, Ukraine sometimes takes a position claiming the right to tax income regardless of legal nuances and international agreements. This creates difficulties for those who have dual residency or have moved abroad but retained assets in Ukraine.
Information about border crossings, which the STS now uses, will help determine residency more accurately. However, this could also create risks for those who live or work abroad for long periods but formally remain Ukrainian residents.
What should citizens do?
Experts recommend not panicking but paying close attention to one's status. If you live abroad and consider yourself a resident of another country, ensure that your documents and facts of residence confirm this. In the event of a request from the tax authority—it is better to act transparently: either voluntarily declare income or challenge the resident status if it does not correspond to reality.
Automatic data exchange is a control tool, not an automatic audit. The main thing is to understand whether you fall under its scope and be ready for dialogue with tax authorities.
