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Changes to Hungarian VAT legislation in 2015 | Meridian

Changes to Hungarian VAT legislation in 2015 | Meridian.

The Ministry for National Economy submitted the proposed changes to tax laws and related legislation to the Hungarian Parliament. The proposal may change until the final voting which is expected to be made in December. The following is a summary of the most important proposed changes to the VAT legislation applicable from 1 January 2015.

Companies newly registered for VAT will be required to file monthly VAT returns in the year of registration and in the following year.

The VAT on motor fuels will be deductible if the purchased motor fuel is taken as material cost in the VAT base of the performed supply of goods.

A VAT rate of 5% will apply to the sale of large live animals (cattle, sheep and goat) and abattoir processed animal products.

The domestic reverse charge will also be applicable for the sale of certain metal products.

Norwegian taxable persons will have a right to submit VAT refund claims. They may reclaim the VAT on their 2013 acquisitions as well and the deadline for filing the VAT refund claims for 2013 will be 30 September 2015.

The VAT number of the customer will need to be included on the invoice if the VAT reaches or exceeds HUF 1 million.

The threshold for the amount of VAT on invoices which must be reported in the Communication of  the data sheet of the VAT return will be decreased to HUF 1 million instead of the current threshold of HUF 2 million.

Foreign taxable persons will not be required to register for VAT in case they acquire goods within a tax warehouse and transport these goods out of Hungary as an intra-community supply of goods. The transaction will need to be declared by the operator of the tax warehouse instead of the foreign taxable person, provided that the operator is authorized to do so by the foreign taxable person.

Reporting obligations concerning road transportation

  •  Electronic road transportation control system (EKAER) will be launched allowing the VAT Authority to track goods transported in Hungary. The purpose of the regulation is to curb chain VAT fraud.

  •  As of 1 January 2015, the transport in the case of intra-community acquisitions of goods, intra-community supplies of goods and first taxable domestic supplies of goods to non-final customers can only be performed by taxpayers which have an identification number (EKAER number) issued by the Electronic Control System of Circulation of Commodities on Public Roads (EKAER).

  •  For the purpose of receiving an EKAER number, the taxpayer (which may be the sender or the consignee depending on the type of transport) will have to report online the data of the transport to the EKAER system operated by the VAT Authority.

  •  The EKAER number is connected to one transport and valid for 15 days from the issuing date.

  •  There is no need to request an EKAER number and report the data of the transport in the case of transports where the vehicle is not subject to the road toll i.e. when the total weight of vehicle is less than 3.5 tons.

  •  The following data of the transport will have to be reported online to the EKAER system in order to have the EKAER number of the transport:

 1. Name and VAT number of the sender

 2. Address where the carrier takes over the goods

 3. Name and VAT number of the consignee

 4. Delivery address of goods

 5. In the case of intra-community acquisitions of so-called ‘hazardous goods’: the name and VAT number        of the recipient if not the consignee takes over the goods from the carrier

 6. In case of intra-community acquisitions of goods: phone number and e-mail address of the person who        is authorized to report the date of arrival of the goods

 7.In case of intra-community supplies of goods: phone number and e-mail address of the person who is         authorized to report the date of dispatching of the goods

 8. Description, commodity code and gross weight of goods

 9. Reason of the transport e.g. supply of goods, acquisitions of goods, moving of own goods, etc.

10. Net value of goods

11. Registration number of the transport vehicle

12. Date of arrival to the delivery address in case of intra-community acquisitions of goods and first taxable domestic supplies of goods to non-final customers

13.  Date when the carrier takes over the goods in case of intra-community supplies of goods

  •  The following rules will be applicable in the case of intra-community acquisitions of goods, including moving of own goods to Hungary.

– The consignee is required to obtain an EKAER number and report the 1-11 data of the transport before starting the transport.

– The consignee is required to provide the carrier with the EKAER number before starting the transport.

– The date of arrival to the delivery address (point 12.) is required to be reported within 15 days from the issuing date of the EKAER number by the consignee or by the person who receives the goods from the carrier.

  •  The following rules will be applicable in the case of intra-community supplies of goods, including moving of own goods out of Hungary.

–  The sender is required to obtain an EKAER number and report the 1-11 data of the transport before starting the transport.

–  The sender is required to provide the carrier with the EKAER number before starting the transport.

–  The date when the carrier takes over the goods (point 13.) is required to be reported within 15 days from      the issuing date of the EKAER number by the sender or by that person which gives the goods to the          carrier.

  •  The following rules will be applicable in case of first taxable domestic supplies of goods to non-final customers (B2B transports within Hungary).

-The sender is required to obtain an EKAER number and report the 1-11 data of the transport before starting  the transport.

– The sender is required to provide the carrier with the EKAER number before starting the transport.

– The date of arrival to the delivery address (point 12.) is required to be reported within 15 days from the         issuing date of the EKAER number by the consignee.

  •  The following rules will be applicable in case of hazardous foodstuffs and other hazardous products.

– Hazardous foodstuffs and other hazardous products will be listed in a separate regulation later this year.

– In case of hazardous foodstuffs, the EKAER number will only be issued to taxable persons who are           registered for the relevant list and deposited the required amount to secure the tax obligations.

– In case of other hazardous products, the EKAER number will only be issued to taxable persons who           deposited the required amount to secure the tax obligations.

– Deposit is not required from the taxable persons listed on the qualified taxpayers’ lists.

– EKAER number and report the data of the transport is required even if the vehicle is not subject to road       toll i.e. when the total weight of vehicle is less than 3.5 tons in case of transports of hazardous foodstuffs of over 200 kg or net value of HUF 250,000.

– EKAER number and report the data of the transport is required even if the vehicle is not subject to road       toll i.e. when the total weight of vehicle is less than 3.5 tons in case of transports of other hazardous           products of over 500 kg or net value of HUF 1,000,000.

  • If the taxpayer did not comply with the reporting obligations concerning road transportation, the transported products could be deemed as goods of unverified origin and as such would trigger a default penalty at a rate capped at 40% based on its value, and a proportion of those goods could be seized up to the amount of the default penalty due.

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