CFC REPORTING AND RISK MONITORING IN FOREIGN ECONOMIC ACTIVITY AS INFORMATION CHANNELS IN THE TAX ADMINISTRATION OF INTERNATIONAL OPERATIONS IN UKRAINE

Abstract

Introduction. In the current context, international operations are one of the key sources of tax risks and, at the same time, an important factor in the formation of budget revenues. For Ukraine, especially under martial law, the need to strengthen the tax administration of transactions involving non-residents, monitor foreign economic activity (FEA), and ensure the transparency of foreign corporate structures has become increasingly relevant. In this context, CFC reporting and FEA risk monitoring serve as important data channels for identifying potential tax minimization schemes, risky tax credit formation, and violations in the field of international taxation.

Purpose. The purpose of the study is to analyze CFC reporting and risk monitoring in foreign economic activity as interconnected administrative data channels within the administration of cross-border transactions in Ukraine based on the reporting data of the State Tax Service of Ukraine for 2023–2025.

Materials and methods. The information base of the study consists of reports of the State Tax Service of Ukraine for 2023–2025, provisions of tax legislation, regulatory legal acts on the export security regime, and scientific works on BEPS, CFC rules, digital VAT control, and tax and customs risks. Content analysis, a comparative approach, descriptive statistics, tabular grouping, and the calculation of derived indicators were applied. These methods made it possible to consider CFC reporting and FEA risk monitoring as interconnected administrative data channels within cross-border tax control.

Results. It has been established that CFC reporting and FEA risk monitoring are different but complementary analytical channels within the system of fiscal control over cross-border transactions. CFC reporting has a corporate and jurisdictional dimension and ensures the disclosure of information on foreign companies, controlling persons, jurisdictions, and declared tax liabilities. FEA risk monitoring has an operational dimension and covers export-import operations, tax invoices, UKT ZED commodity codes, the origin of goods, risky tax credit, and tax and customs cooperation. A significant expansion of CFC reporting has been identified: the number of CFC reports increased from 900 in 2023 to 68,078 in 2025, while the number of foreign companies covered by reporting reached 29,838 in 2025. In 2024–2025, the export security regime covered 114,620 tax invoices and adjustment calculations worth UAH 1,071.9 billion, which indicates the strengthening of agricultural export monitoring. At the same time, the summary nature of STS data limits the possibility of assessing the final fiscal effectiveness of control measures.

Prospects. Further research should focus on developing an integrated system of indicators combining data from CFC reporting, FEA monitoring, electronic VAT administration, customs information, and audit results. This would make it possible to move from describing administrative data flows to assessing the effectiveness of tax control over cross-border transactions.