SAF-T UA in 2026: How Electronic Audits Are Changing Tax Inspections

The introduction of the Standard Audit File for Tax (SAF-T UA) is changing the approach to tax inspections in Ukraine. Instead of selectively examining accounting documents, tax authorities can now analyze structured datasets covering a company's business transactions, compare information from different accounting systems, and identify discrepancies that might previously have gone unnoticed. For businesses, this means reconsidering not only the technical processes used to prepare financial and tax reports but also their approaches to documenting business transactions, protecting commercially sensitive information, and challenging the findings of tax inspections.

What Is SAF-T UA, and Why Is Its Introduction Changing Tax Control?

SAF-T (Standard Audit File for Tax) is an international standard for the electronic exchange of accounting data developed by the Organisation for Economic Co-operation and Development (OECD). Its Ukrainian adaptation, SAF-T UA, provides for the creation of a structured electronic file in XML format containing detailed information about a company's financial and business activities over a specified period.

Unlike traditional tax returns, which primarily reflect aggregated figures, the standard audit file provides access to a significantly broader range of accounting data. In particular, it includes information on fixed assets and intangible assets, banking and cash transactions, sales and purchases, inventory movements, stock balances, accounting entries, and settlements with counterparties.

For tax authorities, this format creates opportunities to automatically compare information from different sources, identify inconsistencies between financial and tax accounting records, and analyze individual business transactions without having to examine large volumes of paper documents sequentially.

For businesses, however, preparing SAF-T UA effectively means reproducing a substantial portion of their accounting records in electronic form, increasing the importance of reliable primary documentation, consistency of accounting data, and properly organized internal controls.

It is important to understand that SAF-T UA does not, in itself, constitute proof of a violation of tax legislation. A discrepancy identified through automated analysis may justify further examination of a business transaction, but any conclusion that a violation has occurred must be supported by appropriate evidence and comply with the requirements of the Tax Code of Ukraine.

SAF-T UA Regulatory Framework: What Businesses Need to Know

The legal framework governing the provision of documents and information to tax authorities during tax inspections is primarily established by the Tax Code of Ukraine.

Under paragraph 85.2 of Article 85 of the Tax Code of Ukraine, taxpayers are required to provide officials of the tax authorities with all documents relating to or connected with the subject matter of an inspection. This obligation arises after the inspection has commenced.

Specific requirements concerning the provision of documents in electronic form by large taxpayers are established by paragraph 85.2 of Article 85 of the Tax Code, while the procedure for submitting such documents is regulated by the relevant regulations of the Ministry of Finance of Ukraine. In the context of SAF-T UA implementation, particular importance is attached to Order No. 1393 of the Ministry of Finance of Ukraine, dated November 7, 2011, which approved the

Procedure for Providing Documents of Large Taxpayers in Electronic Form During Documentary Tax Inspections. It is necessary, however, to distinguish between a company's technical ability to generate a standard audit file, its participation in relevant pilot projects, and its legal obligation to provide documents electronically during a particular tax inspection. Whether a company is required to submit SAF-T UA, the scope of information it must provide, and the applicable submission deadline must be determined with reference to its taxpayer status, the type of inspection, the content of the tax authority's request, and the current version of the applicable regulations.

Consequently, the introduction of electronic auditing does not mean that tax authorities may demand unrestricted disclosure of all information contained in a company's accounting system without complying with the relevant procedural requirements.

Five Major Electronic Audit Risks for Ukrainian Businesses

The practical implementation of SAF-T UA creates a number of risks for businesses that extend beyond the technical configuration of accounting software. Many potential problems arise at the intersection of tax legislation, accounting practices, and the procedural rules governing tax inspections.

Risk 1: Technical errors when generating and submitting the file

The standard audit file must comply with the prescribed structure and technical requirements, including the XML format and the relevant XSD schema. Errors in date formats, character encoding, mandatory fields, or the structure of individual sections may cause the file to fail automated validation. In such circumstances, a company may face allegations that it has failed to properly comply with the tax authority's request for documents. However, a technical error should not automatically be equated with deliberate refusal to provide information. When assessing the lawfulness of potential penalties, it is necessary to establish the cause of the error, the content of the tax authority's request, the taxpayer's actual actions, and whether the statutory grounds for imposing liability exist.

Risk 2: Discrepancies between accounting records, primary documents, and tax returns

Automated analysis makes it possible to compare information on the purchase of goods, their recognition in inventory, subsequent sales, write-offs, depreciation of fixed assets, and the reporting of these transactions in tax returns. For example, a company may record the purchase of goods in one reporting period, while their recognition in inventory or subsequent movement is recorded in its accounting system on a different date. Similar discrepancies may arise from incorrect data transfers between accounting programs, errors in preparing VAT invoices, or the improper recording of business transactions. Not every such inconsistency indicates a violation of the law. Nevertheless, it may require additional explanations.

Risk 3: Increased scrutiny of the substance of business transactions

SAF-T UA allows tax authorities to analyze the relationship between the purchase of goods and services, their use in business activities, subsequent sales, and the recording of the relevant transactions in accounting records. If a company reports the purchase of a substantial quantity of goods but its accounting data contains no information about the subsequent movement or use of the relevant inventory, the tax authority may question whether the transaction actually took place. However, the absence of certain information from an electronic file does not, in itself, prove that a business transaction was fictitious or did not occur. Such a conclusion requires an examination of primary documents, the actual movement of assets.

Risk 4: Disclosure of commercially sensitive information

A standard audit file may contain detailed information about counterparties, pricing, discount arrangements, inventory balances, cost structures, and other aspects of a company's business activities. Some of this information may constitute a trade secret, and its unauthorized disclosure could cause economic damage to the company. Therefore, when preparing for an electronic audit, businesses should pay attention not only to the completeness and accuracy of their data but also to the legal grounds for its disclosure, proper documentation of information transfers, and compliance with requirements for protecting restricted-access information.

Risk 5: Limited time to comply with tax authority requests

Preparing SAF-T UA may require considerable time, particularly where a company uses several accounting systems or processes a large number of business transactions. Under paragraph 85.2 of Article 85 of the Tax Code of Ukraine, a large taxpayer must provide documents in electronic form no later than the business day following the day on which it receives the relevant request during an inspection. Without advance preparation, a company may simply be unable to generate the file, verify its structure, correct technical errors, and ensure proper submission within the required period. Preparation for an electronic audit should therefore begin before the company receives a request from the tax authority, rather than after an inspection has been initiated.

How Businesses Should Prepare for Electronic Audits

Preparation for SAF-T UA should address the technical, accounting, and legal aspects of a company's operations simultaneously. Simply purchasing software capable of generating XML files is insufficient, as even a technically valid file may contain accounting discrepancies that require explanation during a tax inspection.

First, a company should assess its existing accounting system and determine whether it can generate a standard audit file in accordance with the applicable technical requirements. The next step should involve generating a test SAF-T UA file for a previous reporting period and subsequently analyzing the resulting data. Such testing can help identify errors in the file structure, incorrect recording of individual business transactions, and inconsistencies between accounting registers and tax returns.

Particular attention should be paid to primary documentation, including contracts, certificates of completed works or services, delivery notes, documents recording the movement of goods, inventory write-offs, marketing services, and other transactions that traditionally attract increased scrutiny from tax authorities. For companies processing a large number of business transactions, it is also advisable to establish an internal procedure for generating, verifying, and submitting SAF-T UA, with clearly defined responsibilities for accounting, finance, and legal personnel.

Such a procedure should cover not only the technical process of creating the file but also the verification of its consistency with primary documents, approval of information transfers to the tax authority, and retention of evidence demonstrating proper compliance with the relevant requirements. It is important to establish an action plan in advance for responding to requests from the State Tax Service of Ukraine. In particular, the company should determine who will verify the legal grounds for a request, who will be responsible for generating the electronic file, and how compliance with the request will be documented.

This approach reduces the risk of a situation in which the accounting department is attempting to urgently prepare a substantial volume of data while the legal department begins assessing the lawfulness of the request and the scope of the disclosed information only after the data has already been submitted.