The Hungarian Chamber of Auditors sent a letter to all companies that deposited their financial statements by 31 August 2025 without the auditor’s report, despite being subject to statutory audit under the Hungarian Accounting Act.

Which companies are subject to statutory audit?

A failure to conduct a statutory audit may pose a serious issue for any company keeping double-entry bookkeeping in Hungary, as these entities are generally required to undergo a statutory audit under the applicable Accounting Act. The obligation for statutory audit is determined based on two core criteria:

• Threshold-based criteria: the company’s net sales revenue exceeds HUF 600 million on average over the two previous financial years, and the average number of employees exceeds 50 over the same period.
  
• Other criteria: the legal form of the entity (e.g. branch office in Hungary of a company registered in a non-EU country, joint-stock company), the nature of its activities (e.g. credit institution, listed company), or other factors (e.g. entity included in a consolidation) may also trigger statutory audit requirements.

It is important to note that the HUF 600 million threshold may only be applied for financial years beginning on or after 1 January 2025, due to the amendment of the Hungarian Accounting Act at the end of 2024. For the period examined by the Chamber (typically the financial year 2024), the previous HUF 300 million net sales revenue threshold must still be used when determining the statutory audit obligation.

What should companies do in case of failure to conduct a statutory audit?

Companies that have missed their statutory audit have until 30 June 2026 to carry out the audit retroactively and have the auditor’s report prepared. The financial statements audited in this manner do not need to be republished; the auditor will report the fact of the audit to the Chamber. However, it is advisable to notify the Chamber via email that the omission has been rectified.

They must elect an auditor and specify that the appointment covers the audit of the 2024 financial year (as well). A mandate agreement must also be concluded. If the company is no longer subject to statutory audit in 2025, the auditor does not need to be appointed for at least one full year; both the appointment and termination may occur in 2026. A permanent auditor must be a registered auditor or audit firm listed in the Hungarian auditor registry. If an audit firm performs the statutory audit, it must designate the individual auditor responsible for completing the audit.

The company’s corporate documents must be amended to include the appointed auditor, and the auditor’s details must be filed with the Hungarian Court of Registration.

Other cases of non-compliance

If the company has an auditor’s report but simply forgot to submit it, the omission can now be remedied by filing it with the Chamber within 15 days. The same 15‑day deadline applies to companies that are not subject to statutory audit but still received a notice. They must submit a justification to the Chamber explaining why they were not required to undergo audit.

Legal consequences of failure to conduct a statutory audit

If the company fails to remedy the missed statutory audit, meaning it does not have the auditor’s report by the given deadline, the Chamber will initiate a legal compliance procedure before the Hungarian Court of Registration. This procedure may even lead to the dissolution of the company.

In the event of failure to conduct a statutory audit, the non-compliant company may still avoid the legal consequences – such as the default penalty or a cancelled tax number – if the management takes the necessary steps in time. The accountants at WTS Klient Hungary have helped prepare and publish countless financial statements in the nearly 25-year history of the company, and have in-depth experience with statutory audit obligations. Feel free to contact us if you have a question on this topic, or would like to entrust us with your company’s accounting.

This article provides general information and does not constitute advice.

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Obligation to issue an invoice

The taxable person is required – unless the Hungarian VAT Act provides otherwise – to issue an invoice for the supply of goods or services as defined in the relevant sections of the Act, provided that the recipient is another person or entity different from the taxable person.

An invoice is any document that meets the requirements set out in Chapter 10 of the Hungarian VAT Act. Our previous articles provide more detailed information on the mandatory data content of invoices and the rules on issuing invoices.

However, certain facts or circumstances may come to light only after the invoice has been issued, making its modification necessary. Administrative errors may also occur, requiring correction. If an error is detected in a received invoice, it does not always need to be returned: the correction may be performed by issuing a document qualifying as an invoice, a term defined in Hungarian VAT Act.

What is considered a document qualifying as an invoice?

A document qualifying as an invoice is any document other than the original invoice that meets the statutory requirements and clearly refers to the specific invoice while modifying its data content. It is essentially a collective term for documents that adjust an invoice. A document qualifying as an invoice may be a cancellation invoice (reversal note) or a modifying invoice (correcting invoice with negative or positive amount, or a correcting invoice which does not affect the amount), provided that it meets the legal requirements.

The original invoice and the modifying document qualifying as an invoice are jointly valid and together form the documentation of the transaction.

Another accepted method is the so‑called two‑step modification, in which a cancellation invoice and a new invoice with correct data content are issued. In this case, both the cancellation invoice and the new invoice must refer to the original invoice; the three documents together constitute the valid documentation of the transaction. However, this method is not recommended when the tax base and/or VAT amount change, as it is more difficult to ensure correct electronic data reporting (i.e., Hungary’s online invoice reporting) and compliance in the VAT return.

It is also accepted practice that a supplier modifies the data content of multiple invoices with a single document qualifying as an invoice. In such cases, the document must include:

• references to all invoices whose data it modifies,
• the specific data elements of each invoice affected by the modification,
• the nature of the modification, and
• its numerical impact, if any.

All of these details must be presented clearly and transparently for every modified invoice. It is important to note that this solution can only be used for modifications affecting the tax base and/or VAT amount if all affected invoices must be reflected in the same VAT return period. In practice, this method may be difficult to apply, as not all invoicing systems are capable of generating such documents or ensuring compliant electronic reporting. Therefore, it must be applied with due caution.

When do we issue a document qualifying as an invoice?

A document qualifying as an invoice is required, among others, in the following cases:

If the originally issued invoice contains:

• an incorrect tax base or VAT amount,
• an incorrect VAT rate,
• an advance payment exceeding the total amount of the final invoice,
• a misspelled product or service description,
• an incorrect performance date,
• an incorrect buyer name, address, or tax number,
• or any missing supplementary data.

What requirements apply to such a modifying document?

The minimum data content of such a document is the following:

• the date of issuance,
• a unique serial number enabling unambiguous identification,
• a reference to the invoice whose data the document modifies,
• the specific invoice data being modified, as well as the nature of the modification and its numerical impact, if any.

The Hungarian VAT Act specifies only the minimum data content; any additional information considered relevant by the issuer may also be included.

Furthermore, the provisions applicable to invoices must also be applied to these documents. Therefore, from the date of issuance until the end of the statutory retention period, the following must be ensured:

• authenticity of origin,
• integrity of content and readability,
• and suitability for tax administration identification.

This also means that a document qualifying as an invoice may be issued using invoicing software or pre‑printed forms produced by a printing company.

Key points to keep in mind

Without aiming for completeness, the following aspects should be considered when issuing a modifying document :

• Electronic data reporting with the appropriate content is required even for documents qualifying as an invoice.

• It must be examined in which VAT return period the document should be included.

• Exchange rates may also cause issues; therefore, the exchange rate displayed by the invoicing software should always be verified.

• The performance date of the document qualifying as an invoice has to be the same as the performance date of the original invoice to be modified, unless the performance date itself is being modified.

• As a result of the invoice modification – taking into account both the original invoice and the modifying document – the tax base or VAT amount cannot become negative.

This article focuses primarily on invoices and documents qualifying as an invoice issued through invoicing software. It does not cover cases involving pre‑printed, manually completed invoices or documents qualifying as an invoice. Should you have any questions regarding the issuance of an invoice or a document qualifying as an invoice in Hungary, our highly experienced experts are happy to assist you.

This article provides general information and does not constitute advice.

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Although an interim closing is advisable even when not compulsory, there are cases where it is not optional for the company. The preparation of an interim closing and an interim balance sheet may be prescribed by law. In such cases – unless otherwise provided by law – the interim balance sheet must be prepared for the date determined by the company, taking into account all economic events since the last financial statement.

How to prepare an interim balance sheet?

The interim balance sheet must be compiled in accordance with the rules applicable to the annual financial statements, based on analytical and general ledger records, supported by inventory, and in a way that allows subsequent verification. It must include year-end valuation adjustments (such as depreciation, impairment, provisions, accruals). The key difference between year-end and interim closing is that in the latter case, analytical and general ledger records cannot be closed; they must be maintained continuously.

For the purpose of substantiating equity, the interim balance sheet can be taken into account for up to six months following the balance sheet date.

Mandatory cases for interim balance sheet

As we indicated in our previous article, an interim closing is required if the company must prepare an interim financial statement or if an interim audit takes place.

An interim balance sheet must be prepared in the following cases if there is no annual financial statement prepared within six months:

• Payment of dividend advances: dividend advance can only be paid from retained earnings supplemented by the after-tax profit shown in the interim balance sheet, provided that the amount of equity – reduced by tied-up reserves and positive valuation reserves – does not fall below the registered capital even after considering the interim dividend amount.

• Repurchase of own shares / capital increase: The repurchase (acquisition) of own shares, partnership shares, or redeemable shares is subject to the condition that the last available or the interim balance sheet shows sufficient coverage from retained earnings supplemented by after-tax profit, excluding amounts considered for interim dividend.

• Company restructuring (merger, dissolution): In case of restructuring, companies must prepare draft statements of assets and liabilities and inventories of assets and liabilities, followed by their final versions, instead of the normal annual financial statement.

• Voluntary liquidation or winding up: At the start of voluntary liquidation, an activity closing financial statement must be prepared, and upon completion, a final liquidation closing statement must be drawn up.

• Trusts: During trust asset management, asset distribution can only occur up to the amount of the initial capital. For interim asset distribution, data from the interim balance sheet are required.

Audit of interim financial statements

If the company is subject to statutory audit, the financial statement containing the interim balance sheet must also be audited.

Preparing an interim balance sheet and financial statement is not merely an administrative task; in certain situations, it is a legal obligation under Hungarian law. Knowing and complying with these requirements is essential for lawful operation and sound financial decision-making. It is therefore advisable to prepare in advance and seek expert assistance when necessary. The accounting experts at WTS Klient Hungary are ready to support you in this matter!

This article provides general information and does not constitute advice.

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Why is interim closing important?

An interim closing is necessary if:

• the company is required to prepare interim financial statements (we will cover this case in detail in an upcoming article), or
• an interim audit is to be performed.

However, it is worth considering even when not mandatory, simply to make the annual closing easier. An interim closing not only supports year-end closig but also improves financial planning and management decision-making.

Interim closing: Key tasks and benefits

By performing an interim closing, accountants can bring forward many tasks that are otherwise only required – and common – as part of the annual closing. This gives the company a timely and clearer picture for making business decisions affecting the next year. Below are the main tasks to review.

Reconciliation of general accounting and legal principles

It is worth considering the need to update accounting policies during the year, especially in the event of new activities or regulatory changes.

It is essential to review thresholds that may affect the format of financial statements or the need for new obligations. What needs to be reviewed:

• Audit obligation: If the company has recently become subject to statutory audit and this was not verified after the previous closing, an interim closing helps identify this. This allows the company’s management to prepare for the year-end audit and select the independent auditor with whom it wishes to work in a timely manner.
  
  
• Format of financial statements: If the company previously prepared simplified financial statements but is now required to prepare full annual statements, it is better to be aware of this during the year.
  
  
• Tax obligations exceeding specified limits: A company becomes liable to declare certain tax obligations if it exceeds certain business size or other indicators, so it is also crucial to examine these at the latest during the interim closing.

Reviewing contracts and agreements related to new business activities allows for prior consultation on appropriate accounting treatment – especially important if the new activity requires special accounting practices.

Balance sheet reconciliation

As part of the interim closing, it is advisable to review the general ledger, identify incorrect entries, and reconcile transactions that differ significantly from previous years.

Capitalization and classification of tangible assets, setting useful life, accounting for advances on investments, and documenting disposals and sales (e.g., disposal reports, invoices) are also areas that are handled by the accountant during the year, but it may be crucial to review their completeness as part of the interim closing.

Particular attention must be paid to checking employee advances, customer and supplier balances, advances, and invoice completeness and accuracy. Special attention should be paid to checking the existence and accuracy of invoices issued in the online invoice system of the Hungarian tax authority, as validation requirements have tightened significantly since September 2025. With regard to invoices, it is particularly important to review the VAT rules applied and to identify special items, such as project-based services.

Among the company’s transactions, it is essential to reconcile new credit and loan agreements and related interest, and to verify new related-party transactions with transfer pricing experts, including the report of IC (intercompany) partners.

It is advisable to compare equity and reserves with company registry and resolutions. If there have been any changes, these must be followed up in the accounts on the basis of the relevant documents, as must the balance of the development reserve and any changes thereto. It is also worth examining the need to accrue provisions. If a prior-year provision is no longer justified, its release at year-end should be discussed.

Income statement reconciliation

Companies need up-to-date profit&loss figures in their accounting, aligned with payroll and tax accounts. During interim closing, the following tasks help ensure accuracy and speed up and make the year-end closing more efficient:

• Payroll and accounting alignment: Verify that payroll data matches the general ledger and track any adjustments.

• Tax account review: Regular checking of the tax account, control of VAT reconciliation, and monitoring of quarterly tax payments are essential to ensure that all tax obligations are declared and paid on time and that the general ledger balances match the tax account.

• Accruals management: Review prior-year accrual releases and identify current-year items affecting multiple periods contributes to the preparation of an accurate income statement.

• Monitoring expenses: Ensure monthly and quarterly expenses are properly recorded and identify missing invoices for complete cost accounting.

Benefits of interim general ledger review

An interim closing and general ledger review not only make the accountant’s job easier but also provide significant benefits for the company. It enables faster response to financial changes, greater transparency for management and owners, and give a true picture of the company’s financial, asset and income position during the year. This significantly reduces year-end risks, making interim closing the key to a smooth and efficient annual closing.

For more than 25 years, the accounting experts of WTS Klient Hungary have supported clients in making the most optimal business decisions. Contact us if you need a thorough, experienced accounting team that not only performs mandatory tasks but also offers solutions to help achieve your business goals – such as an interim closing. Our accounting professionals are ready to assist you!

This article provides general information and does not constitute advice.

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• to reduce administrative burden,
• to clarify legal conditions, and
• to implement guidelines of international legal sources

in several tax types. In this article, we summarise the most important changes.

Value added tax

VAT groups

• Creation of VAT groups: The Hungarian 2025 autumn tax package would simplify the process of creating VAT groups. In the future, a statement by the member that its registration system is capable of clearly separating internal and external transactions would be sufficient, so it would no longer be necessary to demonstrate this.

• VAT group representative: In case of termination of a VAT group representative, if the group does not appoint and register a new representative within 15 days, the Hungarian tax authority would automatically appoint the member with the highest tax performance to this role. The group representative would cease to be such if the member in question were to be subject to liquidation or involuntary deregistration proceeding.

Data reporting obligation

Based on the proposal, it will be mandatory to indicate the actual amount of VAT to be deducted at the invoice level in the VAT return summary report, not just the tax base and the VAT transferred. This provision would apply to the main pages, the pages containing amendment and cancellation invoices, and the data reporting relating to advance invoices. The amendment would enter into force in July 2026.

VAT rate change

From 1 January 2026, the VAT rate payable on the sale of beef and related offal would be reduced from the current 27% to 5%.

Global minimum tax

• New definitions: In connection with the application of the transitional CbCR safe harbour rules, the definitions of simplified covered tax, recognised CbCR, qualified financial statements, and simplified effective tax rate would be introduced.

• Clarification of transitional tax rates: With regard to the transitional relief for substance based income exclusion, it would be clarified which transitional tax rate would have to be paid in which year.

Personal income tax

Mothers raising two or more children

The Hungarian 2025 autumn tax package would also simplify the tax advance declaration process in connection with the tax allowance for mothers raising two or more children.

• No separate declaration required: From 1 January 2026, mothers of three children could indicate on their family allowance declaration form if they wish to claim the allowance for mothers raising three children. Mothers of two children who gradually become eligible will also be able to take advantage of this option.

• Continuity: The mother concerned may also declare to her employer that her declaration should be considered a continuous tax advance declaration. This declaration would be valid until a new declaration is submitted.

• Tax exemption for mothers raising or having raised two children: This will be introduced gradually over four years, until 2029, depending on age.

Crypto transactions

In the case of crypto transactions, the time limit for tax equalisation would be eliminated. This means that not only losses from the previous two years, but also earlier losses not yet included in tax adjustments could be offset against trading profits in the current year. For the purposes of tax adjustment, records must be kept that clearly show the amount of losses not yet utilised in tax adjustments. This option would already be available in the 2025 personal income tax return, but it is a condition that losses older than two years must have been reported in previous years’ returns.

Compensation from credit institutions in the event of data theft

In the case of bank customers who have fallen victim to data theft, the amount reimbursed by the bank out of fairness would be considered tax-free income. The tax exemption applies to compensation not exceeding the amount of the loss; for amounts exceeding this, the general rules apply. This rule would take effect on the day following the adoption of the bill.

Social security and social contribution tax

From 1 January 2026, permanent contract work would be introduced. In this relationship, social security contributions and social contribution tax would have to be paid on the contractual fee, but at least 30% of the minimum wage. The principal may declare the permanent nature of the contract work, thereby ensuring the continuity of the insurance relationship until the end of the legal relationship and reducing subsequent administration.

Social security registration system

According to the Hungarian 2025 autumn tax package, the development of a complex IT system would help individuals access data related to health insurance benefits and pension contributions on a single platform, thereby facilitating administrative processes.

Accounting

The bill clarifies related parties‘ transactions with each other where they have agreed on the subsequent settlement of differences arising from market prices. The clarification would allow taxpayers to apply a market price determined within the market price range agreed upon by the parties, even if it differs from the median, in their accounting records, as opposed to the median tax base adjustment in the case of subsequent accounting price adjustments. According to the Hungarian 2025 autumn tax package, the amendment will apply to the 2026 financial year, but it will also be possible to opt for its application for 2025.

Corporate tax

Support for spectator team sports

The Hungarian 2025 autumn tax package clarifies the conditions for the disposal of tangible assets acquired from the support of spectator team sports, especially in the case of free transfer.

Tax relief for R&D activities

• Upper limit of tax allowances: According to the proposal, the legislator would set the maximum tax allowance for R&D projects carried out jointly with research institutes, higher education institutions, and the Hungarian Academy of Sciences at 10% of R&D costs, with an annual upper limit of HUF 500 million. The proposal is expected to enter into force on the day following its promulgation.

• Time limit: The time limit for choosing the R&D tax allowance will also change: taxpayers will now be able to change the method of claiming the tax allowance from the fifth year following the first tax year chosen, instead of the previous sixth year.

Small business tax

The Hungarian 2025 autumn tax package would remove electronic funds from the concept of cash from 1 January 2026, so they would not have to be taken into account when determining tax base adjustment items.

Duties

• Forgiving loan: Forgiving shareholder’s loan would become duty-free. An exception to this would be if the liquidation does not end with the deletion of the company from the company register. In the latter case, the duty amount must be paid with a late payment surcharge.

• Property rights related to home ownership: The duty assessment provisions relating to the acquisition of home ownership by private individuals would be extended to the acquisition of property rights related to home ownership.

• Leaseholder rights: From 1 January 2025, not only the fact of financial leasing can be indicated in the real estate register, but also the leaseholder’s right to transfer ownership. This option is currently provided for in the Hungarian Land Registry Act, but the Hungarian 2025 autumn tax package would transpose this change into the Hungarian law on duties as well.

Local taxes

• Lessee’s right: In addition to the duty law, from 1 January 2026, the law on local taxes would also include the lessee’s right and the right related to the retention of ownership in the definition of property rights.

• Municipal tax: Under the Hungarian 2025 autumn tax package, local governments would not be able to levy municipal tax on forests and related property rights.

Tax administration

The Hungarian 2025 autumn tax package would introduce automatic decision-making in tax matters, allowing the Hungarian tax authority to make decisions automatically if all the necessary data is available.

In this article, we have tried to provide a thorough summary of the most important parts of the draft Hungarian autumn tax package 2025 that affect companies’ decision makers. If you have any questions about the changes detailed here, please contact the tax consulting team of WTS Klient Hungary who are always at your disposal.

This article provides general information and does not constitute advice.

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In what cases can companies decide to initiate a voluntary liquidation?

The voluntary liquidation procedure can be initiated for several reasons, provided that the company is not insolvent. Typically, changed market conditions, cost optimisation in the case of companies with an international background, or changes in legislation prompt owners to terminate their companies through voluntary liquidation.

Voluntary liquidation cannot be decided, and voluntary liquidation that has already begun cannot be completed if the court, prosecutor’s office, or investigating authority conducting criminal proceedings notifies the company or the commercial court that criminal proceedings may be brought against the company.

Voluntary liquidation in Hungary is one of the possible forms of termination without a legal successor, the accounting tasks of which are set out in Hungarian Government Decree 72/2006. (IV. 3.), but in matters not regulated by the government decree, the provisions of the Hungarian Act on Accounting shall continue to apply.

Planning the voluntary liquidation

During the voluntary liquidation procedure, the company will have several tax and accounting obligations that differ in terms of timing and content from those fulfilled during standard operations. It is advisable to consider these before deciding on voluntary liquidation and to plan the tasks and obligations to be performed.

8 aspects to consider before deciding on voluntary liquidation

1. One of the most important questions is whether the owner wishes to terminate the company through standard voluntary liquidation or so-called simplified voluntary liquidation. The latter option is available to companies that are not subject to an audit and can complete the voluntary liquidation within 150 days.

2. The resolution must specify the start date of the voluntary liquidation and, in the case of standard voluntary liquidation, the liquidator. From the start date of the voluntary liquidation, the managing director’s mandate ceases and from then on, the liquidator represents the company.

3. In the case of simplified voluntary liquidation, it is not necessary to appoint a liquidator, as the senior executive of the company performs this role.

4. It is advisable to set the start date of the voluntary liquidation as the first day of the financial year, so that the company does not have to prepare an additional accounting close due to the start of the voluntary liquidation, and the financial statements can be the financial statements ending the activity as well. If the start date of the voluntary liquidation is not the first day of the usual financial year, the financial year of the voluntary liquidation is 12 calendar months from the start date of the voluntary liquidation.

5. Simplified voluntary liquidation may involve less and faster administration and, in some cases, even lower costs, as it is not necessary to have a lawyer prepare the legal documents to be submitted to the Hungarian Court of Registration.

6. Before starting the voluntary liquidation procedure, it is advisable to review the company’s books in detail. The composition of assets and liabilities and the amount of outstanding receivables and liabilities must be examined. This is necessary because during voluntary liquidation, the company must settle all receivables and liabilities it has towards third parties.

7. During voluntary liquidation, it is advisable to submit a request for a reduction in tax advances payable to the Hungarian tax authority and local authorities if, based on calculations, the planned tax will be less than the tax advances payable. This will also reduce the amount of any subsequent overpayment.

8. If the voluntary liquidation is also subject to an audit obligation, it is advisable to consult with the auditor before starting the procedure in order to comply with the deadlines.

Stages of the voluntary liquidation procedure

1. Commencement of voluntary liquidation

Within 30 days of the start of the procedure, the company must prepare a final financial statement with the day preceding the start of the procedure as the balance sheet date, which must also be audited in the case of a company subject to audit. In addition, the preparation and approval of the resolution accepting the financial statement must also be planned within the 30-day deadline.

In addition to the financial statement, the liquidator is also responsible for preparing the final tax returns (VAT, corporate tax, contributions, and local business tax) and data reporting:

• notification to the local authority within 15 days of the start date of the voluntary liquidation,
• in the case of simplified voluntary liquidation, notification to the Hungarian tax authority using form T201T, which must also be completed within 15 days. (In the case of standard voluntary liquidation, lawyers fulfill this notification obligation to the Hungarian Court of Registration.)

2. Tasks to be performed during the voluntary liquidation period

Creditors may submit their lender demands within 40 days of the announcement of the commencement of voluntary liquidation, which the liquidator shall record in a register and forward to the Hungarian Court of Registration. If there is a discrepancy between the receivables reported and the values shown in the company’s books, the liquidator must prepare a corrected opening balance sheet for the voluntary liquidation as of the start date.

Tasks of the liquidator

• termination of the company’s activities
• collecting receivables
• satisfying creditor claims
• terminating existing contracts
• terminating employment contacts
• ensuring the preservation of tax and accounting documents and records for the period prescribed by law, including for the period following the voluntary liquidation
• selling assets, if necessary
• distribution of remaining assets among the owners

This period lasts from the start date of the voluntary liquidation until its completion, during which time the company must comply with the tax and contribution returns that are customary in the standard course of business.

3. Completion of the voluntary liquidation procedure

Standard voluntary liquidation may take up to three years. During this period, the company must complete standard year-end closings for each financial year. (In the case of simplified voluntary liquidation, this may take up to 150 days.) If standard voluntary liquidation is not completed within three years, involuntary deregistration will be conducted.

A decision by the owner is sufficient to complete the voluntary liquidation; no separate members’ resolution is required.

The company is subject to a reporting obligation also towards the local authority, which must be fulfilled within 15 days of the closing date of the voluntary liquidation.

Upon completion of the voluntary liquidation procedure, the liquidator is required to ensure that the following documents are prepared:

• final tax returns
• financial statement concluding the voluntary liquidation
• proposal for the distribution of remaining assets
• resolution of the members’ meeting

In the case of standard voluntary liquidation, the above documents must be submitted simultaneously within 60 days of the closing date of the voluntary liquidation.

Companies opting for simplified voluntary liquidation have a total of 150 days to complete the voluntary liquidation and submit the above documents, which must be prepared based on predefined document templates. These are available on the website of the Hungarian government website (available in Hungarian).

Tax authority must also be involved

In the case of simplified voluntary liquidation, an additional task is to provide the tax office with information on the closing date of the voluntary liquidation on the T201T form. If the simplified voluntary liquidation is completed with the decision to continue the company’s operations, this must also be reported on this form.

If the company is unable to complete the simplified voluntary liquidation within 150 days, it must switch to standard voluntary liquidation under the general rules.

During the voluntary liquidation procedure, it is important to complete all tax returns and data reporting by the deadline, as failure to do so may result in the Hungarian tax authority imposing a penalty on the liquidator.

After the above obligations have been fulfilled, the Hungarian tax authority has the option of initiating a retrospective tax audit. The company can only be dissolved if the tax authority issues a certificate to the Hungarian Court of Registration stating that it has no debts or open tax cases. The Hungarian tax authority has a maximum of 90 days to issue this certificate in the case of standard voluntary liquidation and 30 days in the case of simplified voluntary liquidation.

After the certificate has been issued, the company registry court will delete the company from the company register. After deregistration, the company’s bank accounts can be closed and, at the same time, the assets specified in the asset distribution proposal can be paid out to the owners.

Voluntary liquidation is the closure of a company’s activities without a legal successor, which involves complex accounting and tax tasks. The owners can choose between a standard or simplified procedure, taking into account obligations, deadlines and costs. The voluntary liquidation procedure requires planning, precision, and adherence to deadlines, so it is definitely worth involving an expert. The accounting professionals at WTS Klient Hungary are at your disposal!

This article provides general information and does not constitute advice.

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Corporate tax

• Preferential transfer of assets: The Hungarian summer tax package 2025 clarifies the conditions for tax deferral. If the shareholding requirement is only partially unmet, only the corresponding part of the previously deferred gain will become taxable, proportional to the transferred participation falling outside the affiliated group. The acquiring company must calculate the tax base differently in such cases.

• Corporate spin-off: This qualifies as a preferential transfer of assets for corporate tax purposes, thus allowing deferral and exemption from duties and excluding transfer pricing obligations.

• Reported shares: Following clarification, the participation exemption rules  will also apply to cross-border transformations occurring after the promulgation. If the taxpayer became a Hungarian tax resident due to a transformation completed in 2024, the benefit still applies provided all legal conditions (e.g., notification within 75 days) are met.

• IFRS-based taxation: The tax base calculation for corporate tax under IFRS is clarified. For derecognition of  own shares or participations (including in-kind contributions), the pre-tax profit must be adjusted for related profits or losses from the current and the previous tax years.

• R&D tax relief: The HUF 50 million limit on the tax base allowance for the direct costs of research and development activities carried out jointly with higher education institutions, the Hungarian Academy of Sciences and certain other research institutions is raised to HUF 150 million.

All corporate tax-related provisions of the Hungarian summer tax package 2025 take effect the day after promulgation.

Global minimum tax

• Notification of supplementary taxpayer status: The deadline is now the last day of the second month following the tax year-end (e.g. for the calendar year 2025: 28 February 2026).

• Default penalty: Violation of GloBE data reporting obligations may result in a fine of HUF 10 million by the Hungarian tax authority.

• Passive accrual: The anticipated supplementary tax for a financial year must be accounted for as a passive accrual, to comply with the matching principle. This rule already applies to reports for financial years starting in 2025.

Value added tax

• E-cash registers: Mandatory real-time receipt data reporting is postponed from 1 July 2025 to 1 September 2026. Voluntary use of e-cash registers is permitted from 1 July 2025, and related reporting obligations already apply from that date. The package also specifies technical and procedural requirements.

• Customs representative declaration: From 1 October 2025, customs representatives must declare the tax base and VAT amount in order to exercise the right to deduct VAT transferred to them.

• Travel services: From 1 January 2026, VAT base and tax amounts need not be indicated on invoices (unless the customer is a taxable person declaring non-travel organizer use). This does not apply to online reporting.

• Natural gas sales: From 1 January 2025, reverse charge VAT applies to gas sales between domestic taxable dealers. From 20 July 2025, buyers must declare their taxable dealer status. Both parties are subject to data reporting, including MWh volume.

• Online invoice data reporting: From 1 January 2026, successor-issued invoices must include the predecessor’s tax number. For VAT groups, both the group and the participating member’s tax numbers must be reported.

• Payment service provider reporting: The opening or closure of a payment account must be reported to the Hungarian tax authority within 7 days instead of 15.

• Chain transaction audits: From promulgation, the audit period is extended where multiple taxpayers must be audited to establish VAT liability (e.g. up to 365 days for reliable taxpayers).

Personal income tax

• Mothers’ allowance: The Hungarian summer tax package 2025 includes a number of technical changes related to the allowance for mothers of two and three children.These clarify the order of applying allowances, update prepayment declarations and regulate monthly tax return data. Infant care benefit (csed) and child care benefit (gyed) become tax-exempt with this new allowance.

• Expansion of tax-free benefits: From promulgation, tax exemption for employer-provided housing (e.g. service apartments, workers’ accommodation, dormitories) extends to foreign employees housed at Hungarian branches of foreign companies, provided legal conditions are met.

• Private use of electric bicycles: From 1 January 2026, tax exemption extends to electric bicycles up to 750 W (previously 300 W) when provided for private use by the employer.

Social contribution tax

From 1 January 2026, a new tax obligation arises for employers paying income to pensioners claiming PIT allowances for dependent children. The tax applies if total income exceeds four times the average annual wage and the payer would otherwise be required to withhold advance tax. Related entities are considered a single payer.

Tax procedure rules

• Binding tax rulings: From 1 August 2025, pre-consultations may be requested online for a HUF 1 million fee. Regular rulings cost HUF 10 million, urgent ones HUF 14 million, standard contract rulings HUF 12 million, and combined urgent/contract rulings HUF 16 million.

• Procedures to determine arm’s length prices: From the 31^st day after promulgation, fees increase to HUF 10 million (unilateral) and HUF 14 million (bilateral/multilateral). Pre-consultation costs rise to HUF 1 million per session.

• Branch registration: From promulgation, taxpayers must report the name and tax number of their Hungarian branches to the tax authority.

• Delisting from negative lists: Employers may apply once a year for removal from certain public negative lists of the Hungarian tax authority if no more than five employees were unreported and the related fine is paid in time.

• Automatic payment relief: Thresholds for eligibility increase for reliable taxpayers and both natural and legal persons, regardless of taxpayer classification.

Duties

From the 31^st day after promulgation, property value corresponding to a solar or wind power installation is exempt from transfer duty.

Special tax on credit institutions and financial enterprises

The special tax on credit institutions and financial enterprises continues in 2026. Tax is based on the 2024 pre-tax profit, adjusted as specified. Rates: 8% up to HUF 20 billion (7% in 2025), and 20% above (18% in 2025). The allowance for increasing the stock of government bonds is still available.

Income tax for energy suppliers

The income tax rate for energy suppliers is set at 41% in 2025 and 31% in 2026.

Additional insurance tax

The additional insurance tax liability will remain for the tax year starting in 2026, but the amount of the allowance will be increased from 30% to 60% of the increase in the nominal value of the government bonds portfolio.

Accounting

The entry into force of sustainability reporting obligations is postponed by two years.

In this article, we have tried to provide a thorough summary of the most important parts of the Hungarian summer tax package 2025 that affect companies’ decision makers. If you have any questions about the changes detailed here, please contact the tax consulting team of WTS Klient Hungary who are always at your disposal.

This article provides general information and does not constitute advice.

A Hungarian summer tax package 2025 adopted bejegyzés először WTS Klient Hungary | tax | accounting | payroll | advisory | HR services | digital solutions | state aid-én jelent meg.

Why is a loss of equity dangerous?

Companies that do not take the necessary measures to fix their equity structure are putting their very existence at risk. The balance sheets in the published financial statements show immediately the structure of the company’s equity and make it possible to determine whether the company’s equity is insufficient or has become negative. In such a case, the Hungarian Court of Registration will require the representative of the company to explain what he / she has done to remedy or eliminate the equity deficit. The fact that the equity problem form has been solved must be certified by the company’s representative. Otherwise, the Hungarian Court of Registration, exercising its supervisory rights, will initiate the liquidation of the company, which cannot be reversed.

If, due to loss, the company’s equity has been reduced to half of its registered capital, the decisions of the general meeting, convened without delay, must be implemented within three months. The latter rule of the Hungarian Civil Code is applicable to limited liability companies. In case of a company limited by shares, the law provides that in the event of a reduction of the equity to two thirds of its registered capital, the general meeting must be convened within eight days and its resolutions on fixing the equity structure must be implemented within three months.

If, based on the information contained in its financial statements under the Hungarian Act on Accounting, the company, for two consecutive full financial years

• does not have an amount of equity corresponding to the registered capital required for its legal form,
• and the members (shareholders) of the company fail to provide the necessary equity within three months of the adoption of the second year’s financial statements under the Hungarian Act on Accounting,

the company must decide within 60 days of the expiry of the deadline to transform to another company form or must make provision for liquidation without legal succession.

What are the possible solutions to a loss of equity?

We have already written about ensuring capital adequacy, but it is good to review and update your knowledge every year.

Additional capital contribution

The loss of equity can be solved by paying an additional capital contribution, which must be placed in the allocated reserve at the same time as the transfer of cash or assets. In this way the loss of equity is reduced or even eliminated. An additional capital contribution may be paid by the owners if they have undertaken to do so and if such a provision is included in the articles of association. The exact amount of the additional capital contribution must be recorded in a members’ resolution.

The provisions of the Hungarian Civil Code allow for the possibility of making an additional capital contribution not only in cash but also by transferring tangible assets, materials or a member’s loan as a receivable.

Capital increase

Equity problems may also be solved by a registered capital increase combined with an increase in the capital reserve. The increase in registered capital and capital reserve must be entered in the books on the date of registration of the increase in registered capital with the Hungarian Court of Registration. This reduces or eliminates the loss of equity.

Increase in capital from a shareholder’s loan or in-kind contribution

Capital situation may be settled either by a capital increase from a shareholder’s loan or by way of an in-kind contribution. In both cases, it is also advisable to increase the capital reserve at the same time as increasing the registered capital.

Change of company form

A transformation can also be a solution to overcome a loss of equity. A limited liability company (Kft.) with loss of equity can be transformed into a limited partnership (Bt.).

Merger, fusion

The loss of equity in a group of companies with the same ownership can also be solved by a merger or fusion. This requires that the positive retained earnings of one company are larger than the negative retained earnings of the other. If the combined retained earnings of the companies remain negative, the positive retained earnings can also be secured by revaluation, by increasing the capital reserve in conjunction with an increase in registered capital, or by transferring registered capital to the retained earnings. In the transformation process, i.e. a merger, more than two companies may be involved. In this case, the retained earnings of the company resulting from the merger or fusion must be positive.

Forgiving shareholder’s loan

The capital situation can also be solved by forgiving shareholder’s loan. The amount forgiven, which is recorded as other income, is included in equity in the profit and loss account, thereby increasing the value of equity. This reduces or even eliminates the loss of equity. Forgiving a liability booked in the course of the year is included in other income until the year-end closing and is only included in the balance sheet profit or loss and thus in equity at the balance sheet date, thus reducing or eliminating the loss of equity.

However, a tax liability arises on the liability forgiven. The corporate tax base cannot be reduced by the amount recognised in the tax year because of the liability waived by the original holder. The maximum burden of the waived liability is due to the gift duty that came into force on 1 January 2008, which can be as high as 18%.

Exemptions from the gift duty are provided for in the Hungarian law on duties. Also the acquisition of a claim by way of a gift between business entities, including debt forgiveness and debt assumption. Consequently, no duty is payable on a forgiven shareholder’s loan if the forgiving owner is a company.

Forgiving approved dividends

The loss of equity can also be solved by forgiving approved dividend, which is paid directly to equity on the date of the waiver.

Application of upwards revaluation

When the upwards revaluation is recorded, the source of the upwards revaluation is recorded as a valuation reserve, which increases the value of equity. This may reduce or eliminate the equity deficit.

The possibility of applying an upwards revaluation can only be recorded at the balance sheet date and must be included in the accounting policy and certified by an auditor. The amount of the upwards revaluation should be determined by reference to the market value at the date of the preparation of the balance sheet as defined in the accounting policy, rather than at the balance sheet date.

Once the upwards revaluation has been entered in the books, the assets concerned are shown in the books at market value. The amount of the upwards revaluation is reviewed annually upon the preparation of the balance sheet, with the result that its value increases, decreases or may not change. This may result in a change in the value of the equity and hence impacts the volume of the loss of equity.

Decrease in registered capital

A reduction in registered capital may be made by placing it in the retained earnings in order to reduce or eliminate the loss of equity. The decrease in registered capital and the increase in the retained earnings are recorded as of the date of registration with the Court of Registration.

The reduction of the share capital shall affect the members’ shareholdings in proportion to their share in the capital unless otherwise provided in the articles of association or in the resolution of the general meeting of members deciding on the reduction of the share capital.

When the share capital is reduced by a capital withdrawal, the amount of the assets in excess of the share capital shall also be taken into account in determining the amount to which the owner is entitled, in proportion to the share capital. At the same time as the share capital is reduced, a proportionate share of the other elements of the capital, such as the retained earnings, must be paid to the owner, which may give rise to a tax liability.

Assumption of intra-group debt or aid

Between related companies, one company may assume a liability from another company, which may have an indirect effect on equity.

If we can assist you in reviewing your options for resolving the loss of equity and quantifying the potential financial impact, please contact our accounting experts!

This article provides general information and does not constitute advice.

A Loss of equity bejegyzés először WTS Klient Hungary | tax | accounting | payroll | advisory | HR services | digital solutions | state aid-én jelent meg.

Noémi Lénárt holds qualifications as a chartered accountant, tax advisor and IFRS chartered accountant. Over the past 15 years, the accounting expert has gained extensive experience in both professional and management areas at a number of renowned international consulting firms. Her client portfolio includes a wide range of service providers and commercial clients with an international background, for whom Noémi has mainly provided accounting and tax compliance services.

She graduated from the Budapest Business University and the Hungarian Chamber of Auditors, and joined VGD in 2020, where she was in senior accounting manager position until the company’s merger into WTS Klient.

In her new position, as accounting director, Noémi Lénárt’s goal is to continue to support the further development of leading accounting digitisation processes at WTS Klient which has more than 25 years of experience and one of the most recognised players in the Hungarian market, providing personalised, complex business advisory services.

You can download the press release in PDF format here:
 WTS Klient Press Release 11.02.2025 – New accounting director at WTS Klient (PDF)

A New accounting director at WTS Klient bejegyzés először WTS Klient Hungary | tax | accounting | payroll | advisory | HR services | digital solutions | state aid-én jelent meg.

An accounting firm established in 1998 by Hungarian individuals, Klient set up its tax consulting division in 2004, and joined WTS Global in 2013, one of the world’s leading tax and financial advisory networks. Prague-based financial investor, ARX Equity Partners, took a majority stake in the firm in 2022, and with this financial backing along with the 2023 acquisition of Finacont Kft., WTS Klient’s net sales revenue in 2023 exceeded HUF four billion and the number of its employees reached 300 by the end of 2024.

Founded in 2001, also by Hungarian individuals, the dynamic development of VGD Hungary has led to the emergence of a similarly successful company. In 2023, the company’s sales revenue was close to HUF 1.4 billion, and the number of its employees was over 60 by the end of 2024. 

Together with the legal services of WTS Legal, a legal attorneys association established on 1 June 2024, with a total of 370 employees and revenues of nearly HUF 7 billion, WTS provides now the full range of services of the complex business advisory market to more than a thousand clients in Hungary. With the acquisition of VGD Hungary in early July 2024, the company has embarked on a dynamic growth path that will make it the largest player in the Hungarian market after BIG4. 

“We are proud that we have recently achieved market leadership through the acquisition of two major players in the domestic accounting and tax advisory market and through our cooperation agreements. However, our development does not stop here, as we also have a clear goal to carve out the largest possible share in new business segments that will fundamentally determine our future”, said Zoltán Lambert, managing partner of WTS Klient Business Advisory Ltd.

As a clear sign of this, the Debrecen office of WTS Klient will also start its operations on 1 January 2025, providing professional support primarily to big companies investing in the area. The Debrecen office will be headed by Gábor Jankó, senior partner of WTS Klient’s HR services business line.

The merger of WTS Klient and VGD Hungary will augment the expertise of the two companies based on an international knowledge base, for both Hungarian and cross-border transactions; VGD Hungary is adding more international, primarily German-owned multinationals to the clientele at WTS Klient. The promise behind the company’s slogan, “People you can rely on”, can be further strengthened in creating joint professional value.

You can download the press release in PDF format here:
WTS Klient Press Release 02.01.2025 – WTS Klient and VGD Hungary fully merged  (PDF)

A WTS Klient and VGD Hungary fully merged bejegyzés először WTS Klient Hungary | tax | accounting | payroll | advisory | HR services | digital solutions | state aid-én jelent meg.