In my earlier articles in this series on VAT registration, I outlined the theoretical background to the topic: I explored financial representation, then in my most recent article I gave a brief overview of the typical cases when VAT registration in Hungary is indispensable for a foreign company. This article focuses on a significant practical issue: what information on a foreign company subject to registration is required to be able to submit a VAT registration form, i.e. which documents must be attached for a successful registration?
Who should be appointed as an authorised representative?
As I explained in my article on how to appoint a representative for issues concerning the Hungarian tax authority (NAV), foreign companies are better off appointing a Hungarian expert to ensure more efficient administration, someone who can represent the foreign company directly at the NAV in the course of the registration process. Experience shows that, to this end, foreign companies generally authorise a tax adviser, tax expert or an employee of a company authorised to provide tax advisory and accounting services in Hungary.
When registering as a VAT taxpayer, a foreign company generally appoints its future Hungarian representative to act on its behalf at the tax authority and in place of the company’s usual representatives with one-off authorisation.
To facilitate the smooth administration of any subsequent tax-related issues, and apart from the one-off authorisation mentioned above, the foreign company may also appoint a permanent authorised representative, who can represent the company fully in connection with all its tax-related issues – in person, on paper, electronically and by phone. Naturally, such authorised representatives must also be reported to the NAV using the Uniform Representation Form, commonly known as the EGYKE form.
What information is required to complete the VAT registration form?
The VAT registration form, also known as the T201 VAT and change registration form, can be downloaded in Hungarian language from the tax authority website and completed with the help of the program for filling out general forms (ÁNyK). To complete this form properly, the following information is needed: exact name of the company to be registered, the address of its registered office/permanent establishment in Hungary, its core activity and activity code (TEÁOR), and the company data of the foreign company. It is also on the VAT registration form that we have to report the company’s representative or representatives (in the case of joint representation) as stated in the certificate of incorporation. Likewise, here we have to indicate which one of the exchange rates offered by law the company wants to apply to convert its tax base expressed in a foreign currency to Hungarian forints (HUF).
The certificate of incorporation containing the effective company data recorded in the company register must be attached to the registration form. In addition, specimen signatures identifying the signatures of those representing the company are also necessary, as well as a certificate issued by the foreign tax authority on the foreign company’s taxpayer status. These documents should not be older than 30 days, but in our experience the NAV is relatively tolerant in this respect.
If the above-mentioned documents of the company to be registered are available in languages other than English, German or French, then translations of the documents should also be submitted (it does not necessarily have to be a certified translation). If the documents are available in one of the afore-mentioned languages then no translation is needed.
Submitting the VAT registration form
The VAT registration form can be submitted in paper form based on one-off authorisation. Please note that the NAV requests the original signed and stamped copies of these documents, so make sure to have them available when starting the registration process.
The NAV generally issues a tax number in Hungary within two weeks of the submission, but if every relevant document has been submitted then tax numbers are normally issued within just a week. You can check whether your tax number exists by looking on the NAV website, in the taxpayer database (available in Hungarian).