Based on information published by the Ministry of Finance, the government intends to maintain the current invoice-level reporting requirements that form part of the Hungarian VAT return, namely the submission of the so-called M sheet (Domestic Purchase Listing), after 1 July 2026.
Pursuant to Act LXXXIII of 2025, the M-sheet reporting rules applicable to incoming invoices were expected to become more stringent from 1 July 2026. Under the amended rules, taxpayers would have been required to report not only the amount of VAT charged on each invoice, but also the amount of deductible VAT claimed. The amended reporting requirements would have applied to VAT returns for reporting periods commencing on or after 1 July 2026. However, based on information subsequently published by the Ministry of Finance, these changes are no longer expected to take effect, and the current M-sheet reporting requirements are expected to remain in force.
Although the entry into force of the relevant provisions can no longer be prevented, the Ministry of Finance has stated that the government intends to submit a bill to Parliament to ensure that the stricter reporting requirements do not need to be applied in practice in respect of any VAT return period. As a result, businesses are expected to be able to continue fulfilling their M-sheet reporting obligations in accordance with the current rules after 1 July 2026. Accordingly, taxpayers may no longer be required to transition to the previously announced stricter M-sheet reporting requirements, and any related process and system changes may also be reconsidered.
While the application of the stricter reporting requirements is expected to be postponed or ultimately avoided, businesses should continue to monitor the legislative process, in particular the government's proposed amendment and its adoption by Parliament.
In parallel, businesses should continue to monitor developments relating to the eVAT system, as VAT returns are expected to become subject to mandatory submission through the eVAT platform from 1 January 2027.
KPMG’s professionals would be pleased to assist you with any questions regarding the expected changes, the digitalization of VAT return processes, or the transition to the eVAT system. Contact us to discuss the implications for your business and the steps you can take to prepare for these changes in a timely manner.
