Social payments for internally displaced persons: does the law allow for cutting off assistance due to currency transactions?

Internally displaced persons in modern Ukraine are people who are forced to start life from scratch in foreign cities, often without work, housing, support, and with constant fear for those who remained at home. Among them are mainly residents of destroyed or occupied territories, refugees from front-line villages, people who have literally lost everything. They are victims of direct confrontation with war, who saved not comfort, but life. And although the state declared its support for such people from the first months of the invasion, every year the mechanisms of assistance become more and more complicated, and the criteria for receiving it become stricter. What in 2022 was considered a sufficient reason for receiving assistance, may now be “insufficient”. New conditions are imposed on people, regular checks are introduced, data are required to be updated, and costs are controlled, sometimes to the point of absurdity. All this creates additional pressure on those who already live in conditions of prolonged loss of support and stability.

Currently, resettled people are deprived of benefits en masse due to actions that are not prescribed by law as criteria for the termination of assistance: currency exchange, one-time money transfer, credit contribution, not updated address or even “too low spending activity”. At the same time, people find out about the termination of assistance after the fact – when the funds do not arrive.

The editors of IA “FACT” turned to the lawyers of the “Repeshko and Partners” bar association with the following questions: on what basis can officials stop aid to IDPs? What to do when the payment is stopped without warning or based on questionable interpretation?

Currently, the benefit is not awarded/paid to an internally displaced person who applies for it for the first time starting from August 1, 2023, if within three months before the application or at the time of receiving it:

1. An IDP or a family member has purchased a vehicle (mechanism) subject to registration in accordance with the procedure established by law, less than five years have passed since the year of manufacture (except for a moped or trailer).
2. An IDP or a family member who made a purchase for an amount exceeding 100,000 hryvnias, purchased:

• land plot;
• apartment (house) (except for housing located in the territories where hostilities are (were) taking place, specified in list of territories, for which the date of the end of hostilities (ceasing the possibility of hostilities) or temporary occupation, or housing that has been destroyed, has not been determined;
• other real estate, securities and other financial instruments, virtual assets;
• paid (one time) other goods of long-term use (except for cars, building materials, if the person’s home is damaged/destroyed);
• paid (one time) for any works or services (except for construction, if the person’s home is damaged/destroyed, medical, educational and housing and communal services in accordance with the social standard of housing).

1. An IDP or a family member, on the 1st of the month from which the benefit is granted, or on the 1st of each month in which the benefit is received:

• has funds in the deposit bank account(s) in the total amount exceeding 100,000 hryvnias;
• bonds of the domestic state loan, the maturity of which has arrived or is determined by the moment of presentation of the claim, for a total amount exceeding 100,000 UAH

1. An IDP or a person from among family members carried out purchase transactions:

• non-cash and/or cash foreign currency (except currency received from charitable organizations or purchased to pay for medical (including rehabilitation, prosthetics), social and/or educational services);
• bank metals for a total amount exceeding 100,000 UAH

1. An IDP or a family member, on the 1st of the month from which assistance is granted, or on the 1st of each month in which assistance is received, owns a residential premises/part of a residential premises located in territories not included in list of territories, or territories included in the list of territories for which the date of the end of hostilities (ceasing the possibility of hostilities) or temporary occupation has been determined (except for residential premises that are unfit for living, which is documented by a local self-government body, or information (if technically possible) entered in the Register of Damaged and Destroyed Property, or residential premises (parts of residential premises with an area of ​​less than 13.65 square meters per family member), or residential premises (parts of residential premises purchased with funds received on the basis of a loan agreement, if the first installment paid by the authorized person or recipient was less than UAH 100,000).
2. An IDP or a family member applying for housing assistance or a recipient of assistance purchased an apartment (house) using the funds allocated from the state budget to local budgets for the payment of monetary compensation for residential premises suitable for receiving

This is the main list of restrictions that the state puts forward for persons applying for assistance as IDPs, but it is by no means final. However, one of the most interesting items is the purchase of non-cash and/or cash foreign currency. According to subsection 4 of clause 7-1 of the Procedure for providing accommodation assistance to internally displaced persons, families may lose the right to payments if any of its members purchased foreign currency (cash or non-cash) or bank metals for a total amount of more than 100 thousand hryvnias within three months before applying for assistance or during its receipt. The exception is funds received from charitable organizations or currency purchased to pay for treatment (including rehabilitation and prosthetics), social or educational services.

Living allowance is granted for 6 months with the possibility of extension for another 6 months. For those who are already receiving benefits, the entire half-year benefit period is taken into account. If during this time the amount of currency transactions exceeds 100 thousand hryvnias, the right to assistance is automatically canceled. Let’s give an example: if the resettled person started receiving assistance in September 2024, purchased currency for 45 thousand in October and another 58 thousand in December, then in December the total amount exceeds 100 thousand, and the right to assistance is lost from that moment.

We note that in accordance with the current legislation, the IDP is obliged within 14 calendar days after the occurrence of changes that affect the determination of the right to receive assistance (in our case, the purchase of currency), to inform about this by means of postal/electronic communication (if technically possible with the imposition of an electronic signature or the use of means of electronic identification with a high or medium level of trust in accordance with the requirements Law of Ukraine “On electronic identification and electronic trust services”), a social protection body, an authorized person of the executive body of a village, settlement, city council or a center for providing administrative services.

As we can see, the responsibility rests with the IDP, taking into account her integrity. However, as the old lawyer’s proverb says: “A sincere confession mitigates the punishment, but increases the term.” So, in relation to our situation, the question arises: how can the state find out about such a purchase of foreign currency by an IDP, if the person himself writes about it to the state body? In such a case, there is the Law of Ukraine “On the Verification and Monitoring of State Payments”, according to which current verification is provided, which is a systematic activity of data analysis regarding recipients (assistance recipients), establishing the correspondence of the information reported by the recipients to the data processed about them in the information and analytical platform, taking into account changes in the social and financial and property status of the recipients, which may affect the appointment, accrual and/or implementation of state benefits payments and their amount.

During the current verification:

• systematic checks of information on recipients who receive state payments are carried out;
• inconsistencies are identified in the sources of information provided by the subjects of information provision, actual data about the recipient and/or legal requirements affecting the determination of the right to receive and the amount of state payments;
• analysis of data obtained using the information and analytical platform is carried out.

So, if you are a recipient of state aid, then the state’s attention to you will be maximum. Every month, the Ministry of Social Policy ensures the transfer to the Ministry of Finance by means of electronic information interaction of recipient information for ongoing verification. The body of social protection of the population processes the recommendations provided based on the results of verification by means of the electronic systems of the Ministry of Social Policy, and in the event of a violation of the IDPs listed at the beginning of the article, stops the payment from the month that follows the month of the occurrence of circumstances that affect the right to receive assistance.

Living allowance for IDPs is granted for a period of 6 months with the possibility of extension for the next 6 months. Thus, for an IDP who is already receiving benefits, the six-month period of receiving benefits will be taken into account. If a citizen purchased foreign currency during this period, the right to receive assistance is lost when the total amount exceeds UAH 100,000.

In addition, we note that when buying foreign currency at exchange points, the legislation does not provide for the identification of the buyer. Once upon a time, in 2012, there was a practice of buying currency only upon presentation of a passport, but at present this requirement is absent and a person can freely and anonymously purchase as much currency as he needs and as much as he has enough funds. At the same time, cases are resolved in a different way when buying currency at the bank’s cash desk. Sometimes this option is considered in connection with a lower exchange rate, compared to “exchanges”, sometimes funds are needed for deposits, settlements abroad and other operations involving the official use of currency.

Currently, the following requirements apply to banks when conducting currency exchange transactions:

• the sale of foreign currency in cash to individuals is allowed, but the exchange rate cannot differ from the official rate of the National Bank by more than 10% and cannot be lower than it;
• it is forbidden to sell Russian and Belarusian rubles, but there are no restrictions on the sale of other currencies;
• it is forbidden to transfer amounts exceeding 100,000 from personal cards abroad. UAH per month equivalent to the currency in which the transfer is planned;
• it is possible to transfer funds for expenses related to the burial of relatives abroad, for education, treatment and transportation of a sick person without restrictions.

It is worth knowing that when carrying out exchange transactions in banks, they may request not only a passport and an identification code, but also documents confirming the origin of savings and a certificate of income.

As a general rule, no documents are currently required for currency exchange up to 399,999 hryvnias, but for amounts exceeding this figure, it is clearly necessary to provide a document confirming the identity and RNOCPP. The nuance is that the NBU has set a new limit for the purchase of cash foreign currency for non-cash hryvnia funds at the level of 100,000 hryvnias per day, which corresponds to the current limit for cash withdrawals. It is at this very moment that there is a very high probability of the transfer of information in the order of verification of persons receiving state benefits. After all, when you buy 100 euros in cash at a bank counter, no one usually asks you for your passport or RNOCPP. In general, the smaller the one-time purchase amounts of currency, the better.

What to do when an official purchase of foreign currency by an IDP took place, and the relevant authorities learned about it? According to the current legislation, in the case of improper or repeated payment to the recipient of assistance for a certain period, the amount of such paid assistance is returned by the recipient voluntarily or at the request of the social protection body.

At the same time, the social protection body of the population determines the amount of illegally or repeatedly received funds from the moment of detection of the fact of the excess of transferred (paid) benefits and within 30 working days informs the authorized person or the recipient about it by sending a message using postal / electronic means of communication / means of mobile communication that ensure recording of the message or call. In case of non-return of excess paid funds voluntarily within the established time, the body of social protection of the population decides on the issue of their collection in court.

Regarding the appointment and restoration of payments of IDPs. According to the clarification of the Ministry of Social Policy dated 01.10.2024 No. 22665/0/2−24/56, the aid is assigned on the basis of the legal norms in force at the time of application. If a person meets the criteria on the date of application, assistance may be awarded from the time of application, even if they did not meet the criteria in the past. Therefore, the assignment of assistance is legitimate if the person meets the criteria on the date of the application, even if he was previously not entitled to assistance due to the limitations provided by the law.