This legal position was formed by the Supreme Court in the decision in case № 500/576/19 of 27.05.2020.

THE ESSENCE OF THE DISPUTE

The plaintiff requested to declare illegal and cancel the individual tax advice of the SFS, which clarified the question of whether a person who is a lawyer and does not intend to pursue an independent professional activity is obliged to register as a self-employed person.

The plaintiff is listed in the Unified Register of Advocates of Ukraine as a lawyer who practices law individually, and therefore, according to the IPC, he is a self-employed person and is subject to registration or registration with regulatory authorities, for which he must submit to the supervisory authority at the place permanent residence application for f. N 5-OOP, application form N 1-SSC and a copy of the Certificate of the right to practice law.

COURT POSITION

The local and appellate courts dismissed the lawsuit. The plaintiff then filed a cassation appeal, stating that he did not intend to pursue an independent professional activity, and the need to obtain a Certificate of the right to practice law and acquire the status of a lawyer was due solely to his work under an employment contract. As stated in the cassation appeal, the courts of previous instances did not take into account the fact that a person working under an employment contract is not a self-employed person within the meaning of the Tax Code.

Having considered the circumstances of the case, the panel of judges of the Administrative Court of the Supreme Court upheld the cassation appeal and annulled the disputed ITC.

According to the Supreme Court, the analysis of the provisions of the Tax Code and the Law "On Advocacy" shows that an individual who intends to conduct independent professional activity, including advocacy, is subject to registration with the supervisory authority. At the same time, a person pursuing an independent professional activity is considered self-employed only if he is NOT an employee.

Thus, the presence of a lawyer's Certificate of the right to practice law only certifies his right as a lawyer to engage in independent professional activity, but is not evidence of direct practice of law and income from such activities.

Therefore, the defendant's interpretation of the provisions of the law set out in the ITC regarding the plaintiff's obligation to register with the supervisory authority as a self-employed person is incorrect, as the plaintiff is an employee, works under an employment contract and does not intend to pursue an independent career.

Moreover, the individual tax advice provided to the plaintiff actually consists only of a list of legal norms, without explaining the procedure for their practical use in the situation with the plaintiff.

It should be noted that earlier, in its rulings of 27 November 2019 (case №160 / 3114/19) and 5 March 2020 (case №824 / 509/19-a), the Supreme Court had already examined the issue of administration by Law №2464-V single contribution while the natural person is in employment and has the right to engage in independent professional activity, which the person does not actually carry out, and in his decision noted that a person pursuing independent professional activity, including law, is considered self-employed and obliged is obliged to pay a single contribution only if such a person is not an employee.