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Regular Sales and Services in Hungary

By July 26, 2015July 10th, 2021No Comments

Hungary is going to introduce new regulations for regular sales of goods and services. The new rules must be applied for accounting, tax consulting and audit services from 1st July 2015, and for …

Hungary is going to introduce new regulations for regular sales of goods and services. The new rules must be applied for accounting, tax consulting and audit services from 1st July 2015, and for other sales of goods and services on a regular basis from 1st January 2016.

Until now the date of supply of goods and services sold for a fixed time period (e.g. month, quarter, etc.) was the payment deadline of the invoice from VAT point of view. It means that the VAT payment of domestic supplies could be postponed until the due date (but not longer than one year).

From 1st July 2016

  1. if both the date of invoice and the due date is earlier than the last day of the period in question, the date of supply is the invoice date;
  2. if the payment is due after the period in question, the date of supply is the due date but at latest the 30th day following the last day of the period;
  3. in any other case the date of supply is the last day of the period in question.

Although the new regulations have been issued after long discussions, they may be reconsidered during the test period based on the experiences of tax consulting firms.

Frequency of VAT returns in case of retroactive registration

If a foreign company is registered in Hungary from 1st January 2015, it has to file monthly VAT returns in general. However, if the registration is done with retroactive effect from 2014 (which is possible in Hungary with a special application), the first VAT return has to be filed on quarterly basis, so the old rules could be still applied when being registered retroactively.

 

Ákos Cseuz
ABT Treuhand Group