Menu
  • Locations
  • About Us
  • Services
  • Experts
  • News & Knowledge
  • Hot Topics
  • Culture & Career
  • Locations
  • Search
  • Press
  • Events & Webinars
  • CI Guide
  • Contact
  • Albania
  • Angola
  • Argentina
  • Armenia
  • Australia
  • Austria
  • Bangladesh
  • Belarus
  • Belgium
  • Benin
  • Bolivia
  • Bosnia & Herzegovina
  • Brazil
  • Bulgaria
  • Burkina Faso
  • Burundi
  • Cambodia
  • Cameroon
  • Canada
  • Chile
  • China
  • Colombia
  • Costa Rica
  • Croatia
  • Cyprus
  • Czech Republic
  • Denmark
  • Dominican Republic
  • Ecuador
  • Egypt
  • El Salvador
  • Estonia
  • Finland
  • France
  • Georgia
  • Germany
  • Ghana
  • Gibraltar
  • Greece
  • Guatemala
  • Guinea
  • Honduras
  • Hong Kong
  • Hungary
  • Iceland
  • India
  • Indonesia
  • Iran
  • Iraq
  • Ireland
  • Israel
  • Italy
  • Ivory Coast
  • Japan
  • Kazakhstan
  • Kenya
  • Korea
  • Kyrgyzstan
  • Laos
  • Latvia
  • Lithuania
  • Luxembourg
  • Macao
  • Macedonia
  • Madagascar
  • Malaysia
  • Mali
  • Malta
  • Mauritius
  • Mexico
  • Moldova
  • Mongolia
  • Montenegro
  • Morocco
  • Mozambique
  • Myanmar
  • Namibia
  • Nepal
  • Netherlands
  • New Zealand
  • Niger
  • Nigeria
  • Norway
  • Pakistan
  • Panama
  • Paraguay
  • Peru
  • Philippines
  • Poland
  • Portugal
  • Puerto Rico
  • Romania
  • Russia
  • Rwanda
  • Saudi Arabia
  • Senegal
  • Serbia
  • Seychelles
  • Singapore
  • Slovakia
  • Slovenia
  • South Africa
  • Spain
  • Sri Lanka
  • Sweden
  • Switzerland
  • Taiwan
  • Tanzania
  • Thailand
  • Togo
  • Trinidad and Tobago
  • Tunisia
  • Turkey
  • Turkmenistan
  • Uganda
  • Ukraine
  • United Arab Emirates
  • United Kingdom
  • Uruguay
  • USA
  • Uzbekistan
  • Venezuela
  • Vietnam
  • Zambia
  • About Us
  • Our CEO
  • Our Board
  • Our Global Executive Team
  • Quality, Process & Risk Management
  • Corporate Tax
  • Customs
  • Financial Services
  • Global Mobility
  • Indirect Tax
  • International Corporate Tax
  • Mergers & Acquisitions (M&A)
  • Private Clients & Family Office
  • Sustainability & ESG in Taxation
  • Tax Certainty & Controversy
  • Tax Technology
  • Transfer Pricing & Valuation
  • Real Estate
  • Digital Tax Law
  • European Tax Law
  • Latest News
  • Brochures
  • Newsletters
  • Newsletter Subscription
  • Surveys & Studies
  • Pillar Two
  • Climate Protection, Green Tax & Energy
  • Sustainability & ESG in Taxation
  • Culture and Leadership
  • Diversity
  • WTS Global Academy
  • Career
  • Your Development
  • Jobs
  • Pillar Two Team
  • Pillar Two - Implementation Status Wordwide
  • Press
  • Events & Webinars
  • CI Guide
  • Contact
WTS worldwide
  • Albania
  • Algeria
  • Angola
  • Argentina
  • Armenia
  • Australia
  • Austria
  • Bangladesh
  • Belarus
  • Belgium
  • Benin
  • Bolivia
  • Bosnia & Herzegovina
  • Botswana
  • Brazil
  • Bulgaria
  • Burkina Faso
  • Burundi
  • Cambodia
  • Cameroon
  • Canada
  • Cape Verde
  • Chile
  • China
  • Colombia
  • Congo Brazzaville
  • Costa Rica
  • Croatia
  • Cyprus
  • Czech Republic
  • Democratic Republic of Congo
  • Denmark
  • Dominican Republic
  • Ecuador
  • Egypt
  • El Salvador
  • Equatorial Guinea
  • Estonia
  • Ethiopia
  • Finland
  • France
  • Gabon
  • Gambia
  • Georgia
  • Germany
  • Ghana
  • Gibraltar
  • Greece
  • Guatemala
  • Guinea
  • Honduras
  • Hong Kong
  • Hungary
  • Iceland
  • India
  • Indonesia
  • Iran
  • Iraq
  • Ireland
  • Israel
  • Italy
  • Ivory Coast
  • Japan
  • Kazakhstan
  • Kenya
  • Korea
  • Kyrgyzstan
  • Laos
  • Latvia
  • Libya
  • Lithuania
  • Luxembourg
  • Macao
  • Macedonia
  • Madagascar
  • Malawi
  • Malaysia
  • Mali
  • Malta
  • Mauritius
  • Mexico
  • Moldova
  • Mongolia
  • Montenegro
  • Morocco
  • Mozambique
  • Myanmar
  • Namibia
  • Nepal
  • Netherlands
  • New Zealand
  • Niger
  • Nigeria
  • Norway
  • Pakistan
  • Panama
  • Paraguay
  • Peru
  • Philippines
  • Poland
  • Portugal
  • Puerto Rico
  • Romania
  • Russia
  • Rwanda
  • São Tomé and Príncipe
  • Saudi Arabia
  • Senegal
  • Serbia
  • Singapore
  • Slovakia
  • Slovenia
  • Somalia
  • South Africa
  • South Sudan
  • Spain
  • Sri Lanka
  • Sudan
  • Sweden
  • Switzerland
  • Taiwan
  • Tanzania
  • Thailand
  • Togo
  • Trinidad and Tobago
  • Tunisia
  • Turkey
  • Turkmenistan
  • Uganda
  • Ukraine
  • United Arab Emirates
  • United Kingdom
  • Uruguay
  • USA
  • Uzbekistan
  • Venezuela
  • Vietnam
  • Zambia
  • About Us
    About Us

    Here you will find more information on our organization’s structure, experts and global reach.

    Read more
    About Us Our CEO Our Board Our Global Executive Team Quality, Process & Risk Management
  • Services
    Services

    Learn more about our network partners and their services.

    Read more
    Corporate Tax Customs Financial Services Global Mobility Indirect Tax
    International Corporate Tax Mergers & Acquisitions (M&A) Private Clients & Family Office Sustainability & ESG in Taxation Tax Certainty & Controversy
    Tax Technology Transfer Pricing & Valuation Real Estate Digital Tax Law European Tax Law
  • Experts
    Experts

    With a representation in over 100 countries, our team offers local expertise on a global scale. Learn more about our experts.

    Read more
  • News & Knowledge
    News & Knowledge

    Welcome to WTS Global Insights. Here you will find news and updates from our worldwide network.

    Read more
    Latest News Brochures Newsletters Newsletter Subscription Surveys & Studies
  • Hot Topics
    Hot Topics

    Overview of the current "Hot Topics" in the tax industry and how we can support with individual questions.

    Read more
    Pillar Two Climate Protection, Green Tax & Energy Sustainability & ESG in Taxation
  • Culture & Career
    Culture & Career
    Read more
    Culture and Leadership Diversity WTS Global Academy Career Your Development
    Jobs
  • Locations
  • Search
11.06.2018

Hungary: Brand new TP Decree

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

Author
Tamás Gyányi
Senior Partner
WTS Global Transfer Pricing Eastern Europe Sub-Regional Leader
Hungary
View Profile

In accordance with the BEPS Action plan and the international trends, the Minister of Finance Decree of 2009 was replaced by a new transfer pricing decree, effective as of 2018. The decree’s provisions must be applied for the first time in relation to documentation for liabilities for fiscal years beginning in 2018. The main characteristics and some novelties of the new decree are as follows:

Self-revision

The new rule clearly states that making changes is allowed even if an error is detected affecting taxes or arm’s length prices in a completed document. The relevance of this rule is that although a final TP document does not have to be submitted to the Hungarian tax authority, it has to be prepared by the submission date of the corporate income tax return. Now, subsequent changes in the document can be made by law without triggering a default penalty.

Penalty

The size of the penalty imposed for incomplete documentation will not change in 2018, but is still very high. It can amount to HUF 2 million (approx. EUR 6,500) per incomplete or missing document, and as much as HUF 4 million (approx. EUR 13,000) in the case of a repeated failure to comply with the laws.

Structure & language

As of 2018, it is no longer possible to prepare independent documentation. This system has been replaced by one comprising two separate documents: the master file and the local file. Compared with previous years, it is clear that more detailed information is needed in the TP documentation, which requires joint efforts from tax centres and local heads of taxes and tax advisors; e.g. a complete master file cannot be prepared without the effective assistance of the tax headquarters of multinational companies. In practice, we can see that sometimes the description of a specific unique transaction (including related turnover and costs) resulting from the figures of the financial statements can be challenging.

On a positive note, the records and underlying documentation do not have to be prepared in Hungarian. Nevertheless, we still recommend that the documentation be compiled in English, German, French or Hungarian (otherwise, the tax authority may ask for the documentation to be translated, possibly resulting in undue additional expenses).

Database filtering

For companies selected as comparable, it will suffice in the future to carry out database filtering every three years (the financial data of the companies used for the comparisons should be updated every year), provided that there is no significant change in the business activity during this time.

Exemptions

There is no need to prepare documentation on product and service sales recharged without a mark-up, provided that these were transacted with an independent party. Under certain conditions, a simplified documentation for intragroup services of low added value can be prepared.

Inspection trends

In Hungary, there is a special body within the Hungarian tax authority specialising in transfer pricing questions. As of 1 November 2017, there is a so called transfer pricing inspection methodology department responsible for the education of inspectors and assistance in TP inspections. Furthermore, this team is also responsible for MAP procedures. The changes in the related TP decree and the increasing number of TP inspections shows that this field remains one of the major targets of the Hungarian tax authority in the future.

Author
Tamás Gyányi
Senior Partner
WTS Global Transfer Pricing Eastern Europe Sub-Regional Leader
Hungary
View Profile
Article published in TP Newsletter #1/2018
Transfer Pricing Newsletter: Update on the recent news and cases
View publication
Newsletter Transfer Pricing

With this newsletter, we inform multinational companies on country-specific and international legislative documents and regulations.

Subscribe now
Articles you might be interested in

US taxpayers are a subject to both foreign as well as local regulation on their worldwide income. To avoid a potential double taxation US provides a Foreign Tax Credit. Learn more about it and gain a thorough understanding of key tax provisions.

Understanding Section 905(c) and the Foreign Tax Credit
Read more

The Supreme Court has recently ruled on the application of the exemption of dividends paid by Spanish entities to their parent companies in the European Union (EU) by virtue of the provisions of Article 14.1.h) of the Law on Non-Resident Income Tax (“LIRNR”).

Spain: Burden of Proof regarding the Anti-abuse Rule of Dividend Exemption is on the tax authorities
Read more

VAT obligations of Italian PEs/FEs: recent instructions by the Revenue Agency may be critical to business practice

Italy: When an Italian FE is deemed "to intervene"?
Read more

Get in contact

If you have any questions about WTS Global or our global services, please get in touch.
We will respond to you as soon as possible.

Contact
About Us
  • About Us
  • Our CEO
  • Our Board
  • Our Global Executive Team
  • Quality, Process & Risk Management
Services
  • Corporate Tax
  • Customs
  • Financial Services
  • Global Mobility
  • Indirect Tax
  • International Corporate Tax
  • Mergers & Acquisitions (M&A)
  • Private Clients & Family Office
  • Sustainability & ESG in Taxation
  • Tax Certainty & Controversy
  • Tax Technology
  • Transfer Pricing & Valuation
Latest News
  • News & Knowledge
  • Brochures
  • Newsletters
  • Newsletter Subscription
  • Surveys & Studies
Hot Topics
  • Pillar Two
  • Digital Tax Law
  • European Tax Law
  • Climate Protection, Green Tax & Energy
  • Sustainability & ESG in Taxation
Culture & Career
  • Culture and Leadership
  • Diversity
  • WTS Global Academy
  • Career
  • Your Development
  • Jobs
Exclusive Cooperation With
© 2023 WTS Company Information Data Protection Disclaimer