Among both novice and experienced entrepreneurs, a common question arises: “If I already have a sole proprietorship registered, does that mean I cannot apply the professional income tax (NPD)?”

We’re quick to reassure you: it’s not quite that simple. Let’s go over the main nuances to avoid mistakes in reporting and penalties.

Can a sole proprietorship apply the NPD?

Yes, it can, but with one strict condition.

Income from your primary business activity (the one for which the sole proprietorship is registered) cannot be shifted to the NPD regime. However, having a sole proprietorship status does not prohibit you from simultaneously engaging in another permitted independent professional activity and paying tax on those specific earnings at the NPD rate.

The key rule: do not mix financial flows. In a sense, you should have two separate “wallets.” One for sole proprietorship income, the other for NPD income.

Work is done, but the money hasn't arrived yet. When to pay the tax?

A classic scenario. You completed the work, signed a statement with the client, but they say, “I’ll definitely transfer the money tomorrow.”

Do you need to issue a receipt and pay the NPD now? No.

For the NPD regime, the decisive factor is not the date of signing the statement nor the actual completion date of the work, but solely the date of receiving the money.

No payment = no income = no obligation to issue a receipt.

Deadlines for issuing a receipt upon receipt of payment

As soon as the money is deposited into your account or received in hand, you have an obligation to record the income. The deadlines depend on the method of settlement:

• For cash settlement: the receipt is issued strictly at the moment of receiving the money.
• For non‑cash settlement: the receipt must be issued no later than the 7th day of the month following the month in which the income was received.