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All subsoil users, regardless of the stage (exploration, production), except for those carrying out:

• PSA activities;
• exploration and/or production of solid minerals, groundwater, and/or medicinal mud;
• construction and operation of underground structures

are required to submit an EPT return for 2018 in accordance with Article 758, paragraph 2 of the Tax Code, reflecting a one-time deduction of the amount of expenses accumulated for the purpose of calculating EPT that are to be attributed, but not deducted for the purpose of calculating EPT from January 1, 2009 to December 31, 2017.

This provision was introduced into the Tax Code on January 1, 2018.

For instance, if there is a contract for the exploration of hydrocarbons (not even transferred to the production stage) for 2018, it is necessary to submit an EPT return indicating the costs accumulated for the purpose of calculating EPT (accumulated exploration costs) from January 1, 2009 to December 31, 2017.

At the same time, the amount of expenses in the EPT return in the form of an excess of deductions for calculating EPT over the amount of gross income for the tax period will, in accordance with Article 756, paragraph 2 of the Tax Code, be transferred for repayment at the expense of taxable income for the purpose of calculating EPT for subsequent tax periods.

In all subsequent tax periods, it is also necessary to submit an EPT return (regardless of the presence/absence of obligations to pay the tax) with an annual transfer of these costs.

In case of not reflecting these costs (not submitting a return), the costs accumulated from January 1, 2009 to December 31, 2017 cannot be deducted for the purpose of calculating the EPT when an obligation to pay the EPT arises.