WTS in Hungary

On 8 January 2023, the six-month grace period lapsed from the notification of the United Sates to Hungary regarding the termination of its double tax treaty. 

With a view to facilitating transfer pricing reporting properly, the Hungarian Ministry of Finance has published a 25-page document at the end of March.

2023 is starting with significant changes for employees and employers in Hungary: the introduction of new tax allowances, a new type of leave and the minimum wage increasing.

Changes are expected in social contribution tax regarding the determination of the taxable portion of income and the concept of the base salary in Hungary.

Hungarian TP rules are to change significantly in accordance with the bill submitted to the Hungarian Parliament in the summer of 2022.

One of the most drastic changes to Hungarian tax law in recent times, the tightening of the low-tax system (KATA) came out of the blue in the Hungarian economy in mid-July. 

Two-thirds of Hungary’s online customers order their goods from sellers inside and outside Hungary.

On 15 December 2021, the Hungarian Parliament adopted the tax changes for 2022 submitted on 23 November 2021.

Based on the bill submitted in October 2020 and approved in November, Hungarian taxpayers should have been able to use the system for draft VAT returns (eVAT returns) offered by the tax authority as of July 2021. Pursuant to a Government Decree, the roll-out of draft VAT returns has been switched to the tax assessment period starting on 1 October 2021.

With effect from 1 January 2022, the profit realised on crypto asset transactions should be treated as separately taxed income in Hungary.

The online invoice data reporting system moved to the next level on 1 January 2021, extending this obligation to almost all sales invoices issued by Hungarian taxpayers, practically meaning that most invoices issued have to be reported from this date.

Our colleagues in Hungary explain the current focus of the Hungarian tax authority at Hungarian subsidiaries of foreign companies under the aspect of transfer pricing following the COVID-19 crisis.

Our summary of R&D Incentives provides guidance where such incentives are provided, and who in WTS Global can support you to gain from these incentives for your business or individually the most.

Hungary provides a chance to reduce the VAT burden for residential property.

An extension of the scope of invoices subject to the online reporting system in combination with pre-completed VAT returns can be seen in Hungary. 

As a result of measures taken due to the COVID-19 pandemic, numerous questions have risen regarding the social security liability and personal income tax liability of expats.

Employees working in a different country to that where the registered office of their employer is located raises several taxation issues.

Hungary provided its taxpayers a four-month extension of their transfer pricing documentation and furthermore accepts a re-evaluation of the profit-loss model, due to the impact of COVID-19.

An insights on VAT purposes and compliances for non-residents in Hugary.

From 1 July 2020, data reporting at invoice level must cover each invoice issued on domestic transactions to taxpayers registered in Hungary regardless of the VAT amount of the invoice issued

Hungary introduced its online invoice reporting system on July 1, 2018 for invoices issued to another Hungarian taxpayer with a VAT amount reaching or exceeding HUF 100,000. More than a year has elapsed so it is worth taking a look at what the experiences with the system have been and what developments will follow.

What data should an invoice contain and when is it obligatory to report this to the Hungarian Tax and Customs Administration?

Pre-application and new electronic forms have been introduced

The review can be launched at the district government office, and is subject to a fee

New rule in the VAT Act

What they entail in practice and what rules apply

Simplification conditions to become stricter from 1 January

Now only the local business tax base should be aligned with the corporate tax base

Who makes the decision and what conditions need to be met?

Effective as of 1 January 2019 a group taxation model for corporate income tax purposes has been introduced

What do you need to pay if you are not insured?

It is important to review and treat each posting individually

The Hungarian deadline at the end of May is drawing near

Sorainen Latvia collected the main conclusions

Interest deduction limitation based on EBITDA instead of thin capitalisation

Summary of all the rules pertaining to losses that can currently be used

Overview of changes

Overview of what benefits and allowances parents are entitled to in 2019, and what compulsory or optional benefits companies may offer to their employees with children

Key cornerstones of a carve-out

The General Data Protection Regulation (GDPR) sets out obligations for controllers on keeping records of data processing activities

New reporting system seemed to be the most challenging amendment introduced in recent years

Several new procedures have been introduced

Changes in legislation in respect of corporate income tax will come into force on 1 January 2019

100% advance an option if residential property not completed by end of 2019

Overview of  most frequently taxation situations of Hungarian employers in case of official foreign postings to EU Member States

Centre of Competence Tax and Technology - Research centre of WTS and DFKI - developed 5 software types

Transfer tax exemption in property sales in Hungary

Overview of the main characteristics and some novelties of the new decree

Different methods for business valuations and where they can be used

Expertise of WTS Global partner firms from 10 different countries

Judgment details which transactions VAT exemption must be applied for in the case of chain transactions, and whether incorrectly charged input VAT can be deducted

Basic principle: the laws of the country where the employee is in gainful employment must be applied

New features in Act CL of 2017 on Rules of Taxation for the year 2018

GDPR: Summary of the most important rules on checking email accounts used for business purposes, which also involves personal data management

Tasks related to accounting and taxation obligations are highly important - failure to meet these obligations can result in a default penalty from the authorities

How to reclaim money from the NAV: the benefits of health fund membership

Changes: mandatory joint documentation (master file & local file ) - subsequent correction of errors is now enabled

From July 2018: Invoices containing a high amount of VAT and issued to another registered taxpayer must be reported online

What is the connection between the construction boom and the VAT on new apartments?

Tax authority is responsible for companies with international relations and obligations

Taxation rules pertaining to other benefits in the fringe benefit system have undergone favourable changes in Hungary

The General Data Protection Regulation (GDPR) of the EU shall be mandatory and directly applicable in all Member States, including Hungary, from 25 May 2018

Look at the major tax changes for 2018 and considering what this year has in stall for your business

Strategic, tax, legal and accounting aspects of a comprehensive tax inspection

Increasing administration when deducting input VAT 

View report

Service provider obligation to forward data in respect of beneficial owner information

With the help of the tax strategy proposals, the investment mood would improve, the economy and consumption would grow, and this would lead to a rise in tax and contribution revenues.