From 1 January 2027, businesses in Slovakia will be required to issue electronic invoices for domestic B2B transactions via the Peppol network. Electronic invoicing will also entail the direct transmission of invoice data to the Slovak tax authority. A significant number of Hungarian companies have Slovak subsidiaries, related entities or Slovak fixed establishment. As such, these changes will directly affect Hungarian corporate groups. These measures are intended to give the tax authority detailed, near real-time visibility of transactions and to support preparations for the implementation of ViDA.
What is changing in Slovakia?
Under the new system, electronic invoices will be mandatory for domestic transactions between Slovak taxable persons. Paper invoices and “simple PDF” invoices will no longer be sufficient on their own. Invoices will have to be issued in a structured, machine‑readable format compliant with European standard EN 16931, meaning ERP systems and invoicing software will require adaptation. The issuance and receipt of invoices must take place via the Peppol network. In practice, this means that both issuing and recipient businesses must either have an accessible Peppol endpoint or connect to a Peppol service provider to ensure technical connectivity. In addition, invoice data will need to be reported to the Slovak tax authority.
Which Hungarian companies will be affected?
The new Slovak e-invoicing obligation may affect any structure involving a Slovak-registered subsidiary or related company, or a Slovak fixed establishment of a Hungarian company, where invoices are issued to Slovak taxable persons.
In such cases, Slovak legal entities will need to ensure their ability to send and receive invoices via Peppol, and group-level ERP and invoicing system configurations will also need to be adjusted accordingly. Hungarian central tax, finance, and IT teams may also play an important role in planning and managing compliance.
Expected legal consequences and risks
The planned Slovak e-invoicing system may give rise to legal consequences on several levels. While detailed penalty rules are still under development, the current direction suggests that the following risks should be considered. The Slovak tax authority may impose fines of up to EUR 10,000, for example, where an invoice is not issued as an e-invoice or is not transmitted via the Peppol network where required; where invoice data is not transmitted, is transmitted incompletely or is submitted late to the tax authority; or where a business persistently or repeatedly fails to comply with e-invoicing requirements. In cases of systematic or repeated non-compliance, fines may increase to up to EUR 100,000.
The e‑invoice will become the default form of a “valid invoice” for domestic B2B transactions. Accordingly, if an invoice does not meet the mandatory formal and content requirements (e.g. it is not a structured e‑invoice, has an incorrect format, missing mandatory fields or does not follow the Peppol route), there is a risk that the tax authority will not treat it as a document entitling the recipient to deduct input VAT. This may result in additional VAT liabilities, late‑payment interest and tax penalties.
As previously mentioned, the purpose of e‑invoicing and real‑time reporting is to enable the tax authority to have detailed and near real‑time visibility over transactions. Consequently, businesses that regularly submit incorrect or incomplete data may be more likely to be selected for targeted tax audits or, based on the frequency and nature of errors, classified by the tax authority as higher risk.
Technical or legal non-compliance may also result in business consequences. For example, customer payments may be delayed if e‑invoices are not sent or are transmitted incorrectly. Customers may reject e‑invoices that are incorrect or non‑compliant, leading to additional administrative workload, or, in the case of a poorly managed implementation, companies may experience temporary invoicing downtime, manual workarounds and increased internal operational risks.
Key tasks for affected corporate groups
To prepare for the above changes and to manage the financial and operational implications of the new system, affected businesses should focus on the following areas:
- assessing legal and tax compliance, including the identification of affected Slovak entities and the interpretation of expected legal requirements in the context of the company’s specific processes
- process and system assessment, including the identification of relevant invoicing systems and the review of invoice issuance and archiving processes
- IT and integrations, including the selection of a Peppol-capable solution, the definition of integration requirements between the ERP system and the Peppol solution, and the incorporation of the Slovak tax authority’s technical data reporting requirements
- controlling and reporting, including the establishment of new control points, the handling of rejected invoices, and status monitoring
KPMG’s specialists are ready to help assess how the new rules may impact your processes and to support the interpretation and implementation of legal and technical requirements, as well as process design and technology readiness.
