Tax Alert
Tax Alert
Our regular newsletter provides you with updates on the latest changes of tax and accounting regulations as soon as a new rule is being approved.
Our regular newsletter provides you with updates on the latest changes of tax regulations.
2022
Availability of online cash register data via the NAV Online Invoice System
2022-10-21 – The National Tax and Customs Administration (NAV) has made it possible to query the data of invoices issued by the online cash register from the NAV Online Invoice System. The new service is now available for testing.
The National Tax and Customs Administration (NAV) has reconsidered the concept of the eVAT system
2022-10-20 – The National Tax and Customs Administration (NAV) has reconsidered the concept of the eVAT system, which was intended to be introduced in a similar way to the eSZJA. More details of the revised concept, called "M2M", were revealed during recent face-to-face consultations at NAV.
Financial transaction tax extended to cross-border payment services in Hungary
2022-07-05 – On 4 June 2022, Government Decree 197/2022. (VI. 4.) on extra profit surtaxes was published in the Hungarian Gazette.
Government Decree 197/2022. (VI. 4.) on extra profit surtaxes
2022-06-08 – Government Decree 197/2022. (VI. 4.) on extra profit surtaxes was published in the Hungarian Gazette
2021
The introduction of the E-VAT system has been postponed
2021-11-22 – The Government postponed the introduction of the E-VAT system until the end of the state of emergency.
Starting date of VAT return proposals prepared by Tax Authority to be postponed
2021-07-28 – The Government adopted a new decree concerning the VAT return proposals prepared by the Tax Authority and the respective detailed rules.
2021-07-23 – As a part of the Hungarian Government’s package of measures aimed at more widespread checks of construction products, some construction goods are now subject to the EKAER notification process, which creates more administration for taxable persons.
Favourable amendments in relation to VIP cash grants
2021-07-16 – In order to reboot the Hungarian economy, the below favourable amendments have been enacted.
Facilitations concerning the real-time reporting obligations in the case of self-billing
2021-07-05 – According to a previous communication of the Ministry of Finance, there was a sanction-free period until 30 June 2021 for non- or inadequate compliance with real-time reporting obligations, if the customer issued the invoices through self-billing and the customer has not been established in Hungary and does not have (and should not have) a Hungarian VAT registration.
2021-06-15 – As a result of legislation adopted by the EU to reduce pollution, the environmental protection fee (‘green tax’) rates applicable to plastic shopping bags will increase significantly and the distribution of certain plastic products will be banned with effect from 1 July 2021.
Real-time invoice reporting obligation related to self-billing invoices
2021-04-08 – The Ministry of Finance has extended the grace period applicable to the real-time reporting obligation related to certain self-billing invoices.
Statute of limitation for tax base reduction right on bad debts
2021-03-30 – According to a recent order of the Court of Justice of the European Union, the statute of limitation for tax base reduction on bad debts should be considered from the moment when the irrecoverable nature of the debts has been established, instead of from the date of supply of the transactions on which the bad debt relief is intended to be applied.
Application of reverse charge VAT for staff (employee) leasing services significantly reduced
2021-03-17 – As of 1 April, reverse charge VAT for staff (employee) leasing services shall be applied only to those which are construction works-related.
Changes to EKAER and invoice reporting regulations form 2021
2021-01-14 – As anticipated in our previous Tax Alerts, the extent of obligations in regards of EKAER, the Electronic Trade and Transport Control System, starting from the beginning of the year have been reduced. Meanwhile, almost all invoices issued under a Hungarian VAT number trigger a real-time reporting obligation.
2020
2020-11-18 – On 27 October 2020, the Hungarian Government introduced a bill covering amendments to tax and duty law as a part of its new family care action plan. For socio-political reasons, a 5% tax rate will be applicable on the sale of new residential units – the bill introduces changes in the VAT Act accordingly. The Act on Duties will be amended as well: in order to help with their housing, families with children will be exempted from duty when purchasing either new or used residential properties.
Changes in real-time invoice reporting obligation from 2021
2020-09-09 – As of 1 January 2021, the real-time invoice reporting obligation will be extended to cover all invoices issued in Hungary, i.e. all outgoing invoices should be reported online to the Hungarian Tax Authority. In accordance with this change, as of the next year a new XSD schema for reporting means will be released as version 3.0, which will enable reporting under the new requirements of real-time invoice reporting regulations. Norbert Izer, State Secretary for Taxes, announced some new details on the upcoming changes of the regulations applicable as of 1 January 2021, as well as on a grace period, which will be effective until 31 March 2021.
2020-08-18 – A tax law amendment (“the Amendment”) accepted by Parliament for the establishment of the 2021 Hungarian central budget was published on 14 July 2020. Below, we summarize the most important changes to the tax legislation based on the T/10856 Amendment, which has been ratified.
2020-06-16 – Act XLV on Retail tax (“Retail tax Act”) has been enacted and published on 9 June, according to which Governmental Decree No. 109/2020 (“Decree”) has been abolished.
Grace period regarding new requirements for online reporting
2020-06-09 – According to the changes effective from 1 July 2020 on, all invoices issued to domestic taxpayers must be reported online to the Tax Authority, thus the current reporting threshold of HUF 100,000 will cease..
2020-05-07 – This dispatch will outline the main provisions of draft acts No. T/10314 and T/10315, which were submitted by the government on 28 April 2020.
2020-04-28 – This dispatch will outline the main provisions of the 140/2020. (IV. 21.) Government Decree.
Small and medium-sized enterprises may expect VAT refund earlier than the norm
2020-04-21 – According to a communication on the Hungarian Ministry of Finance website, as an economic protection measure in relation to the coronavirus, the Ministry has requested that the Hungarian Tax Authorities (NAV) accelerate the refunding of VAT amounts reclaimed by small and medium-sized enterprises (SMEs).
2020-04-15 – The Hungarian government has introduced its latest regulation to address the consequences of the global coronavirus pandemic upon the national economy. We hereby summarize the most relevant regulations and changes impacting individuals' daily work.
2020-04-15 – As indicated previously, in order to access government funding of economic measures taken in the current epidemic situation, it was announced that new surtaxes would be levied on the retail sector and on credit institutions.
‘New Regulation’ on the changes to social security legislation – expanded list of services
2020-03-31 – On 26 March 2020 the Hungarian government introduced its latest regulation to address the consequences of the global coronavirus pandemic to the national economy. The list of activities for special social security and rehabilitation contribution rules determined by the regulation published on 23 March 2020 has been expanded.
2020-03-30 – In the current pandemic situation, issuing electronic invoices, which do not require postal delivery nor physical contact in contrast to paper-based invoices, could have a significant value, as e-invoices can effectively facilitate payment processing.
‘New Regulation’ on the changes to personal income tax and social security legislation
2020-03-26 – The Hungarian government has introduced its latest regulation to address the consequences of the global coronavirus pandemic to the national economy. The new regulation provides full details on the tax and social security amendments published on 18 March 2020. Below, we summarize the most important of the changes to personal income tax and social security legislation.
Consideration of payment relief requests by the Hungarian Tax Authority
2020-03-24 – Economic operators are facing numerous new challenges in the wake of the COVID-19 pandemic. If payment difficulties emerge at a company, it is worth considering filing a payment relief request with the Hungarian Tax Authority, in particular for deferred payment, payment by instalments or, for private individuals, payment reductions, or in exceptional cases requesting for a release of liabilities.
Covid-19 update and important information from an immigration perspective
2020-03-23 – Given the current situation caused by the COVID-19 virus pandemic we would like to give you an update on the Hungarian government provisions in that regard and, in this context, the current situation in Hungary from an immigration perspective.
Deadline to reclaim unpaid VAT on bad debts: 22 April 2020
2020-03-19 – In the context of the current extraordinary coronavirus pandemic, taxpayers’ primary focus is to temporarily restructure their business processes in a way that minimizes disruptions, yet they are also striving to comply with restrictive social measures to curb the spread of the disease. However, taxpayers who have incurred bad debts should be aware of an important deadline for reclaiming unpaid VAT.
2020-03-18 – On 18 March, the Hungarian Government introduced amendments to tax and social security law as a response to the economic effects of the coronavirus outbreak. This bulletin summarizes the most important of those changes.
The Court of Justice of the European Union made its judgements regarding Hungarian taxation
2020-03-03 – The Court of Justice of the European Union (hereinafter: ‘CJEU’) has issued judgements in relation to three Hungarian cases. In our Tax Alert we highlight their key points.
2019
“SAF-T” - Hungarian Tax Authority launches a project in connection with a new data provision.
2019-12-10 – The National Tax and Customs Authority (NAV) has launched a pilot project for introduction of the Standard Audit File (“SAF-T”) in order to support data provision to facilitate more efficient tax audits and the automated processing of data.
Consequences of EU Court ruling on VAT case in Hungary
2019-10-28 – The Court of Justice of the European Union (“CJEU”) recently delivered a judgement concerning Hungary (case no. C-189/18 “Glencore”) – a ruling that could change the Tax Authority’s approach during tax audit- and related appeal procedures.
Tax legislation amendments
2019-10-15 – New rules on “Quick Fixes” related to VAT set to take effect – draft explanatory notes from Commission now available
Further information on deductibility of input VAT related to car rental published
2019-10-07 – Supplementary information has been published by the Tax Authority regarding the deductibility of the input VAT related to the rental of cars which are used for both business and private purposes. In many cases the previous practice might be affected by this supplementary information.
Real-time Reporting 2.0 in Hungary: increasing requirements
2019-09-19 – More than one year has passed since the introduction of the Real-time Reporting Obligation in Hungary in 2018. Version 2.0 of the Real-time Reporting System, which will take effect from 1 April 2020, represents the first major upgrade rolled out by the Tax Authority. New requirements are being introduced regarding both the format of communication with the servers of the Tax Authority and the format and content of reportable invoice data.
General Court on the Hungarian advertisement tax
2019-07-03 – General Court to annul European Commission's decision finding Hungarian advertisement tax incompatible with EU State aid rules.
Tax legislation amendments
2019-06-24 – After 1 July, for the purposes of identifying goods and services invoices must contain tariff headings as valid from 1 January 2018 and TESZOR’15 numbers (if the taxable person decides to contain such data). The new classifications will also be applicable in terms of determining goods and services which fall under the scope of restriction of VAT deduction, reduced rates or reverse charge, etc.
Tax legislation amendments
2019-06-07 – Hungary's Ministry of Finance has submitted draft tax law amendments to Hungary's parliament for the current and forthcoming year (No. T/6349. and T/6351.) on 4 June 2019. This bulletin summarizes the most important changes to tax legislation in Hungary.
CJEU ruling on incorrect application of reverse charge VAT
2019-05-08 – According to the judgements of CJEU delivered related to Hungarian VAT cases, it is not in contravention of EU law if the tax authority makes an assessment regarding the incorrect application of the reverse charge mechanism against a taxpayer, even if the State Treasury suffered no shortage in relation to the transaction. Besides, the Tax Authority is not obliged to investigate the ability of the supplier to revise the VAT treatment of the transaction.
Legislative changes
2019-02-15 – As per legislative changes adopted this summer, companies qualifying as micro- or small-size enterprises will continue to be exempt from the innovation contribution. Nevertheless, as from 1 January 2019, whether SMEs qualify for innovation contribution purposes or not will not be based solely upon the financials of the individual company, but also through consideration of the financial figures of so-called partner and related companies (as defined by the law) as well, and the resultant aggregated figures should be compared to the respective thresholds for qualifying as an SME.
2018
Expected amendments to Hungary's tax legislation
2018-06-27 – A draft of interim and tax law amendments for next year was submitted to Hungary's Parliament on 19 June 2018. Below, we summarize the most significant changes anticipated according to draft Law No. T/625.
2017
New decree on transfer pricing documentation obligations
2017-12-14 – New issues have emerged regarding Hungary’s country-by-countryreporting obligation. Specifically, several practical questions have arisenin respect of filling in notification sheet 17T201T. In order to clarify theseissues, KPMG’s Tax practice contacted the Hungarian Tax Authority (“theAuthority”), and provides this need-to-know update on country-bycountryreporting.
New decree on transfer pricing documentation obligations
2017-11-03 – On 18 October 2017, the Ministry of National Economy (“NGM”) issued its decree on the documentation obligations for the determination of arm’s length price (“NGM Decree”), which shall enter into force on the 30th day following its promulgation. The new decree contains several changes to the provisions of the former Decree 22/2009. (X. 16.) of the Ministry of Finance on the documentation obligations in connection with the determination of arm’s length price (“Decree 22/2009”).
16CBC form available
2017-10-26 – The Hungarian Tax Authority(’HTA’) has published on its website the 16CBC form to be applied with regards to the obligation of country by country reporting (‘CBCR’), which came into force on 31 May 2017.
Hungary to Adopt Country-by-Country Reporting
2017-06-02 – On 15 May 2017, an amendment to the Act on Certain Regulations on International Administrative Cooperation in Field of Taxes and Other Charges was accepted by the Hungarian Parliament, entering into force on 31 May 2017. Our newsletter summarizes the most crucial aspects of this regulation.
2016
New Transatlantic Privacy Shield
2016-09-16 – The new framework regulating the transfer of personal data between the EU and the U.S. has been available as of 1 August 2016.
USA-Hungary Totalization Agreement – in force as of 1 September
2016-09-02 – Almost 17 months after its domestic publication, the totalization agreement between the United States and Hungary entered into force on 1 September 2016.
EU Commission: Ireland gave illegal State aid to Apple of up to €13 billion
2016-09-01 – EU Commission claims in its decision of 30 August that Ireland granted illegal state aid in its transfer pricing rulings to Apple. The state aid which is estimated by the Commission at up to €13 billion has now been determined to be incompatible with the internal market, and must be recovered (with interest) by the Irish authorities from the Apple group. It is expected that the decision will be appealed. Please read the opinion of the experts of KPMG EU Tax Centre.
New reporting obligation of foreign employees
2016-08-26 – New provisions for the Hungarian Act on Labor Code and the Act on Labor Inspection came into force in order to introduce the provisions of Directive 2014/67/EU of the European Parliament and of the Council on the enforcement of Directive 96/71/EC into Hungarian legislation; this concerning the posting (assignment) of workers who provide services. Based on the implementation of the Directive, additional administrative obligations arise in Hungary regarding the foreign individuals who perform work activities in Hungary.
Brexit: The tax consequences of the UK referendum
2016-06-24 – The Brexit will potentially have a radical impact on the UK tax system, as European law impacts UK tax law both as regards direct and indirect taxation. Please read the opinion of the experts of KPMG EU Tax Centre.
European Union steps forward in the field of direct taxation
2016-06-23 – KPMG’s EU Tax Centre in Amsterdam has published it’s latest news on EU direct tax matters. According to this, on its meeting of June 17, 2016 the Economic and Financial Affairs Council (ECOFIN) of the EU has reached political agreement on the proposal for an anti tax avoidance directive. The ECOFIN also approved Conclusions on the work of the Code of Conduct Group during the Netherlands Presidency and held a short discussion regarding the status of the proposal for a Directive on a Financial Transaction Tax.
Amendments to the Tax Legislation in line with Law No. T/10537
2016-06-10 – The Government has published its latest tax proposal in May, which was approved by the Parliament recently and now it is waiting for the signature of the President. The Parliament accepted almost all of the previous and later modifying proposals.
Expected amendments to the tax legislation in line with draft Law No. T/10537
2016-05-10 – As you may be aware, the Government has published its latest tax proposal, according to which several changes may be expected to the current Hungarian tax legislation.
Tax allowance for those supporting Hungary’s Olympic Games tender
2016-02-12 – A new draft law has been submitted to the Hungarian Parliament that, if enacted, would amend the Hungarian corporate income tax law regarding certain donations. The draft law provides that companies making donations towards the preparation of an offer to host the Olympic Games in Budapest would be able to qualify for a tax allowance.
EU: New anti-tax avoidance package focused on corporations
2016-01-28 – The European Commission today unveiled new measures to address corporation tax avoidance. The EC presented an anti-tax avoidance package that includes two legislative proposals addressing certain anti-base erosion and profit shifting (BEPS) issues and non-public country-by-country (CBC) reporting as well as a common approach to tax good governance towards third countries and recommendations to address treaty abuse.
Belgium: “Excess profit” tax advantages to be recovered from multinationals
2016-01-11 – The European Commission today announced it has concluded that selective tax advantages granted by Belgium under its "excess profit" tax regime are illegal under EU state aid rules. The EC's investigation showed that the regime derogated from normal practice under Belgian company tax rules and the "arm's length principle."
2015
EU: Draft “anti-BEPS” directive, addressing corporate tax planning and evasion
2015-12-17 – The Council of the European Union released details of a possible draft EU directive, addressing certain “anti-base erosion and profit shifting” (anti-BEPS) initiatives. The issues addressed concern certain international aspects of the proposal for an EU “common consolidated corporate tax base” (CCCTB), and reflect issues that are directly related to the OECD’s BEPS project.
EU: Directive on automatic exchange of tax rulings, APAs
2015-12-08 – The European Commission (EC) today announced that the European Council adopted a directive aimed at improving transparency on tax rulings—including advance pricing arrangements (APAs)—given by EU Member States to companies concerning how certain specific taxation issues will be addressed.
OECD: Text of BEPS final recommendations
2015-10-26 – The Organisation for Economic Cooperation and Development (OECD) today issued a final package of reports in connection with its action plan to address base erosion and profit shifting (BEPS), together with a plan for follow-up work and a timetable for implementation.
EU: “Tax rulings” in Luxembourg, Netherlands deemed illegal state aid
2015-10-21 – The European Commission today announced a decision that Luxembourg and the Netherlands granted selective tax advantages to two multinational corporate entities, and as such, these “tax advantages” are illegal under EU state aid rules. The EC concluded that the tax rulings granted by the tax authorities in Luxembourg and in the Netherlands artificially lowered the tax paid by the companies in the respective jurisdictions.
Summary: Expected changes for 2016 to the tax legislation
2015-10-20 – The Hungarian government on 13 October 2015 submitted proposals for certain tax law changes to be enacted for 2016. Among the measures proposed are changes to the rules concerning how individual taxpayers comply with their tax return filing requirements. (Previous Tax Newsletter)
EU: Automatic exchange of information, cross-border tax rulings and APAs
2015-10-06 – EU finance ministers today agreed to introduce provisions for the automatic exchange of information on cross-border tax rulings—the latest development concerning the European Commission’s initiative to address tax avoidance and harmful tax competition. Detailed provisions to be included in a directive are expected to be finalized before the end of 2015, so the exact content of the new rules will not be known until that time.
Expected changes for 2016 to the tax legislation
2015-05-18 – In the Tax Alert we summarize the expected changes to the tax legislation.
An in-depth investigation has been launched into Hungarian advertisement tax procedures
2015-03-16 – In our current newsletter we inform our clients about the in-depth investigation which has been launched into Hungarian advertisement tax procedures.
Significant changes have been introduced to the new Trade Control System (EKAER)
2015-03-06 – In our current newsletter we summarize the major changes of the new Trade Control System (EKAER).
Donations to films, sports and performing arts
2015-01-19 – From 2015, a proportion of corporate income tax is allowed to be offered to artistic performance organizations, film makers and certain sports bodies.
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