Sole Proprietor Receives Payment in Foreign Currency: Is Currency Sale Required and How Is the Exchange Rate Difference Calculated?

A Sole Proprietorship that has received payment from a foreign customer or buyer in foreign currency into a business foreign currency account is not required to sell it immediately or within a specific period solely because the funds have been received. The NBU abolished the requirement for businesses to mandatorily sell foreign currency proceeds as of June 20, 2019. The current wartime currency restrictions establish rules for selling, purchasing, transferring, and withdrawing foreign currency, but they do not impose a general requirement to sell foreign currency proceeds. A Sole Proprietorship may keep the received foreign currency in the account or sell it to the bank when needed for business activities.

For tax purposes, foreign currency income is first converted into hryvnias at the official NBU exchange rate on the date the income is received. For a Sole Proprietorship under the single tax system, any subsequent positive difference arising if the bank sells the foreign currency at a higher rate is not included in income. For a Sole Proprietorship under the general taxation system, a positive difference from the sale of foreign currency increases taxable income, while a negative difference is not included in business expenses. An increase or decrease in the exchange rate of foreign currency that remains in the account does not mean that the Sole Proprietorship must recalculate taxable income every day or at the end of the reporting period.

The rules below primarily concern foreign currency proceeds received into the Sole Proprietorship's business current account with a bank. For funds received into personal accounts, through certain foreign payment services, or from transactions unrelated to business activities, the legal and tax consequences must be determined separately.

Is a Sole Proprietorship required to sell foreign currency after receiving it?

No. There is currently no general rule requiring a Sole Proprietorship to sell all foreign currency proceeds or a certain percentage of them.

Until 2019, Ukraine did have a requirement to sell part of foreign currency proceeds. The last mandatory percentage was 30%. The NBU abolished this requirement as of June 20, 2019.

During martial law, NBU Resolution No. 18 is in effect. It establishes numerous restrictions on foreign currency transactions, but at the same time expressly allows customers — individuals and legal entities — to sell non-cash foreign currency to banks. Therefore, an entrepreneur may decide when to sell foreign currency unless otherwise required by the specifics of a particular transaction.

For example, a Sole Proprietorship received EUR 3,000 for services. They may:

• keep EUR 3,000 in the business foreign currency account;

• sell the entire amount to the bank;

• sell only part of the foreign currency and leave the rest in the account.

At the same time, having foreign currency funds in the account does not mean they can be used without restrictions for any transactions abroad. The purchase of foreign currency, cross-border transfers, and certain other transactions during martial law are subject to the list of permitted cases established by NBU Resolution No. 18. The bank verifies the purpose of the payment and supporting documents where required by foreign exchange supervision rules.

Can the received foreign currency be withdrawn in cash?

There is no absolute prohibition on withdrawing foreign currency from an account.

NBU Resolution No. 18 establishes a general restriction: a bank may not issue cash foreign currency from a customer's foreign currency account in an amount exceeding the equivalent of UAH 200,000 per day, excluding bank fees. The Resolution provides exceptions for certain transactions.

This is an NBU foreign exchange restriction, not a requirement to sell foreign currency proceeds. In addition, the entrepreneur must take into account the intended purpose of the business account and the bank's rules for the specific transaction.

How does a Sole Proprietorship determine income when receiving US dollars, euros, or another foreign currency?

Tax accounting is maintained in hryvnias. Therefore, regardless of whether the entrepreneur keeps the foreign currency in the account or sells it immediately, the hryvnia equivalent of the income received must first be determined.

For a single tax payer, paragraph 292.5 of the Tax Code expressly establishes:

income denominated in foreign currency is converted into hryvnias at the official NBU exchange rate on the date such income is received.

The date on which monetary income is received is the date the funds are credited to the taxpayer.

The State Tax Service applies a similar approach to Sole Proprietorships under the general taxation system: foreign currency funds related to business activities are converted into hryvnias at the official NBU exchange rate on the date they are received.

Taxation of foreign currency income: single tax and general taxation system

The State Tax Service confirmed its position regarding single tax payers, in particular, in its clarification dated July 14, 2026: the positive difference from the sale of foreign currency by a bank on behalf of a Sole Proprietorship is not income of a Sole Proprietorship that is a single tax payer.

Sole Proprietorship under the single tax system: what happens when foreign currency is sold?

For a single tax payer, the tax treatment essentially consists of one main stage.

On the day the foreign currency is received, you need to:

1. determine the amount of foreign currency received;

2. take the official NBU exchange rate for that date;

3. calculate the hryvnia equivalent;

4. include this hryvnia equivalent in income.

If the entrepreneur sells the foreign currency a week or a month later at a higher bank exchange rate, the difference does not need to be included in the single tax payer's income a second time. This is the approach applied by the State Tax Service.

Example for a Sole Proprietorship under the single tax system

A Sole Proprietorship received EUR 1,000. Suppose the official NBU exchange rate on the date of receipt was UAH 49 per EUR 1.

The following amount is included in income:

1,000 × 49 = UAH 49,000.

After some time, the bank sold the EUR 1,000 at an exchange rate of UAH 50 and credited UAH 50,000.

The additional difference of UAH 1,000 does not increase the income of the Sole Proprietorship under the single tax system. This is consistent with the current position of the State Tax Service regarding the positive difference from the sale of foreign currency by a bank.

Sole Proprietorship under the general taxation system: a positive difference is income

The procedure is different under the general taxation system.

Initially, foreign currency proceeds are also determined in hryvnias at the official NBU exchange rate on the date of receipt.

If the bank subsequently sells the foreign currency at a commercial exchange rate higher than the official rate at which the foreign currency proceeds were initially recognized, a positive difference arises. The State Tax Service requires this amount to be included in the entrepreneur's taxable income.

In the previous example:

• initial income — UAH 49,000;

• amount credited by the bank after the sale — UAH 50,000;

• positive difference — UAH 1,000.

For a Sole Proprietorship under the general taxation system, this UAH 1,000 is also included in taxable income.

If the bank sells the foreign currency at a lower rate and the entrepreneur receives, for example, UAH 48,500 instead of the initially recognized UAH 49,000, the UAH 500 difference is not an expense that may reduce net taxable income. The State Tax Service explains this by the fact that such a negative exchange difference is not included in the list of business expenses defined by paragraph 177.4 of the Tax Code.

Does foreign currency in the account need to be revalued at the end of the month or year?

For the tax accounting of a Sole Proprietorship, there are no grounds for including an amount in business income again every month or at the end of the year solely because the NBU exchange rate has changed while the foreign currency remains in the account.

For example, a Sole Proprietorship received USD 2,000 and, on the date of receipt, already determined the hryvnia income at the official NBU exchange rate. If the US dollar appreciates a month later, the new exchange rate itself does not constitute a new receipt of funds by the Sole Proprietorship.

For a Sole Proprietorship under the general taxation system, a separate tax consequence arises when the foreign currency proceeds are actually sold if a positive difference is generated, which the State Tax Service requires to be included in income.

Does the 180-day deadline apply to receiving foreign currency proceeds?

This is a separate issue from the mandatory sale of foreign currency.

For transactions subject to foreign exchange supervision, paragraph 14-2 of NBU Resolution No. 18 establishes a settlement deadline of 180 calendar days for transactions carried out from April 5, 2022 onward.

However, the 180-day rule does not apply to all cases.

Export of ordinary services: the 180-day deadline generally does not apply

NBU Resolution No. 67 excludes the following from settlement deadlines:

• export of services;

• export of works;

• export of intellectual property rights;

• export of other non-property rights.

For services and works, the exception is transportation services and/or works: foreign exchange settlement deadlines may apply to them.

Therefore, for example, the general 180-day foreign exchange settlement deadline does not apply to ordinary exported IT, consulting, marketing, design, and many other services.

Previously, the exception also covered insurance services. As of January 14, 2026, the NBU removed the words «and insurance» from this restriction. As a result, the export of insurance services is also among the transactions to which the settlement deadline does not apply; transportation services and works remain a specific exception.

Transactions below UAH 400,000

Settlement deadlines do not apply to an export or import transaction if its equivalent at the official NBU exchange rate on the date of the transaction is less than UAH 400,000, provided that the transaction has not been artificially split.

Therefore, a transaction worth UAH 399,999 may not be subject to foreign exchange supervision deadlines, but artificially splitting a large contract into smaller payments to circumvent foreign exchange controls is not protected by this rule.

If the exchange rate changes after the transaction and the hryvnia equivalent exceeds UAH 400,000, the State Tax Service explains that the date of the transaction is used to determine the original «minor amount».

Special deadlines for certain exported goods

For exports of goods, the 180-day period cannot automatically be applied to every transaction. NBU Resolution No. 67 establishes special deadlines for certain UKT ZED codes.

In particular:

Resolution No. 67 also contains other narrowly specialized industry exceptions. Therefore, a Sole Proprietorship exporting goods should check the specific UKT ZED code and the transaction date before entering into a contract rather than relying solely on the general 180-day rule.

What penalty may apply for late foreign currency settlements?

If a transaction is subject to foreign exchange supervision and the non-resident fails to settle within the established period, part five of Article 13 of the Law of Ukraine «On Currency and Currency Transactions» provides for a penalty of:

0.3% of the amount of funds not received for each day of delay.

At the same time, the total penalty may not exceed the amount of funds that the entrepreneur was supposed to receive under the agreement.

For example, if the non-resident's foreign currency debt in the hryvnia equivalent is UAH 300,000, the maximum total penalty may not exceed UAH 300,000.

The law provides mechanisms for suspending the deadline and the accrual of penalties. In particular:

• during confirmed force majeure circumstances, the running of the deadline and the accrual of penalties are suspended for the duration of such circumstances;

• after a court or international commercial arbitration accepts a resident's claim to recover a debt from a non-resident, the relevant deadline is also suspended, and no penalty is accrued for that period under the rules of Article 13 of the Law.

A general reference to force majeure alone is not sufficient. The law requires proper confirmation of its occurrence and termination by an authorized organization in the country where the party to the contract is located or in a third country in accordance with the terms of the agreement.

What documents should a Sole Proprietorship retain when receiving foreign currency payments?

The set of documents depends on the type of foreign economic transaction, but the entrepreneur must be able to confirm the origin of the funds, the connection between the payment and business activities, and the correctness of the income calculation.

For this purpose, it is advisable to retain:

• a foreign economic agreement or another document recording the parties' arrangement;

• an invoice;

• a bank statement showing the date, amount, currency, and payer;

• documents confirming the performance of works or provision of services, if such documents are issued under the terms of the agreement;

• for exports of goods — customs and shipping documents relating to the specific shipment;

• bank documents relating to the sale of foreign currency where they are needed to confirm the exchange rate and the hryvnia amount of the transaction.

The Law of Ukraine «On Foreign Economic Activity» allows a foreign economic agreement to be concluded in simple written or electronic form. When exporting services, except transportation services, an agreement may also be concluded by accepting an offer, exchanging electronic messages, or, in particular, by issuing an invoice, including an electronic invoice. Therefore, the law does not require a separate multi-page paper contract for every exported service.

What should a Sole Proprietorship check after receiving a foreign currency payment?

After the funds are received, the entrepreneur should determine the date they were credited according to the bank statement, determine the official NBU exchange rate on that date, and record the hryvnia equivalent of the income.

After that, the tax consequences should be determined separately depending on the taxation system. A single tax payer does not include the positive difference from a subsequent sale of foreign currency by the bank in income again. A Sole Proprietorship under the general taxation system monitors the result of the foreign currency sale: a positive difference increases income, while a negative difference does not reduce it as a business expense.

If this is an export of goods or transportation services or works, it is additionally necessary to check whether the transaction is subject to foreign exchange supervision, which specific deadline applies to the relevant goods, and whether the exception for transactions below UAH 400,000 applies.

Accounting for foreign currency receipts, exchange rates, and bank statements in Torgsoft

Torgsoft provides separate tools for management accounting of transactions in different currencies. The Payment section includes the Exchange Rate, Currency Exchange, and Bank Statements functions. In the «Exchange Rate» form, you can maintain foreign currency purchase and sale rates and use them for settlements, receiving goods in foreign currency, currency exchange, and price calculation.

If the bank statement function is used, Torgsoft allows you to receive and view transactions on current accounts for a selected period. The statement displays the transaction date and time, movement of funds, currency in international code format, and transaction type. This makes it possible to match a foreign currency receipt with a customer's invoice and financial documents in the accounting system.

At the same time, the exchange rate entered in Torgsoft for management calculations should not automatically be treated as the tax exchange rate. To determine the income of a Sole Proprietorship, the law requires the use of the official NBU exchange rate specifically on the date the foreign currency income is received. Therefore, when maintaining foreign currency accounting in the software, the entrepreneur should separately ensure that the bank statement data and the official NBU exchange rate comply with the requirements of the Tax Code.

Official sources

Tax Code of Ukraine dated December 2, 2010, No. 2755-VI — paragraph 292.5 on converting a single tax payer's foreign currency income at the official NBU exchange rate, paragraph 292.6 on the date income is received; Article 177, including paragraphs 177.2 and 177.4, on the income and expenses of Sole Proprietorships under the general taxation system.
Tax Code of Ukraine on zakon.rada.gov.ua

Law of Ukraine «On Currency and Currency Transactions» dated June 21, 2018, No. 2473-VIII — Article 13 on settlement deadlines, the 0.3% daily penalty, force majeure, and recourse to court or international arbitration.
Law No. 2473-VIII on zakon.rada.gov.ua

Resolution of the Board of the National Bank of Ukraine dated February 24, 2022, No. 18 «On the Operation of the Banking System During the Period of Martial Law» — paragraphs 5, 12, 14, 14-2, 14-3, and other provisions concerning foreign currency transactions, cash withdrawals, and settlement deadlines.
NBU Resolution No. 18 on zakon.rada.gov.ua

Resolution of the Board of the National Bank of Ukraine dated May 14, 2019, No. 67 — exceptions and special foreign exchange supervision deadlines, including those concerning exports of services, works, intellectual property rights, and certain groups of goods.
NBU Resolution No. 67 on zakon.rada.gov.ua

Resolution of the Board of the National Bank of Ukraine dated January 13, 2026, No. 3 — amendment to the list of exceptions in Resolution No. 67, including those concerning insurance services.
NBU Resolution No. 3 dated January 13, 2026 on zakon.rada.gov.ua

Law of Ukraine «On Foreign Economic Activity» dated April 16, 1991, No. 959-XII — Articles 5–6, including the form of a foreign economic agreement and the possibility of documenting the export of services by invoice.
Law No. 959-XII on zakon.rada.gov.ua

Law of Ukraine dated December 6, 2019, No. 361-IX on financial monitoring — Article 20, the threshold amount of UAH 400,000 associated with determining a «minor amount» for foreign exchange supervision.
Law No. 361-IX on zakon.rada.gov.ua

National Bank of Ukraine: «Mandatory Sale of Foreign Currency Proceeds by Businesses Abolished» — official NBU announcement on the abolition of the requirement as of June 20, 2019.
Official NBU announcement

Public Information and Reference Resource of the State Tax Service — current clarifications regarding the positive difference from the sale of foreign currency by a Sole Proprietorship under the single tax system, the positive difference for a Sole Proprietorship under the general taxation system, and the negative difference that is not included in its expenses.