«Business splitting» in a shoe store chain: ESBU secures over 10.5 million UAH in tax restitution in Lviv region

 The owner of a chain of footwear and leather goods stores in the Lviv region has reimbursed the state over 10.5 million UAH in unpaid VAT. To evade the tax, he used a "business splitting" scheme that involved 13 individual entrepreneurs.

The pretrial investigation was conducted by detectives from the Territorial Office of the ESBU in the Lviv region.

The investigation established that the chain owner developed the scheme to avoid mandatory registration as a value-added tax payer. To achieve this, he engaged 13 FOPs, who were actually hired employees of his stores, and registered the receipt of funds from selling goods to final consumers under their names.

At the same time, the registered entrepreneurs did not engage in independent economic activities, and they submitted tax reports under the instruction of the suspect.

In this manner, during 2025, the man intentionally evaded the payment of nearly 10.6 million UAH in VAT from a revenue of over 52.8 million UAH.

His actions are qualified under Part 2 of Article 212 of the Criminal Code of Ukraine (intentional tax evasion on a large scale).

Prior to being brought to criminal liability, the suspect fully reimbursed the damages caused to the state. In connection with this, a motion to release him from criminal liability has been forwarded to the court.

Procedural guidance is provided by prosecutors of the Lviv Regional Prosecutor's Office.