Self-billing with a foreign partner

In addition to Hungarian domestic VAT transactions, self-billing is a common method for cross-border transactions. In these cases, the foreign buyer issues the invoice for the Hungarian purchase on behalf of its supplier. According to the rules on online invoice data reporting in force from 4 January 2021, from that date onwards both Community supplies and export invoices are subject to the reporting obligation (in addition to sales to private individuals). We discussed this earlier.

What is the challenge?

According to the relevant rules, it is essentially the taxpayer in the other country who is required to fulfil the online invoice data reporting obligation, while the partner issuing the invoice and the taxpayer assigning this task are jointly and severally liable for any failures. However, the fulfilment of this obligation and its practical implementation raise a number of issues. For example, one of the most common questions related to the online data reporting of self-billing is whether it is necessary to implement any IT development in the foreign partner’s invoicing software so that it can provide data on the invoice to the Hungarian tax authority, or do the supply chain and invoicing procedure have to be completely reconsidered?

Temporary grace period for penalties

The Hungarian authority recognised the complexity of the issue related to self-billing, and as a result, the Ministry of Finance extended the moratorium until 30 June for cases where the invoice is issued by the buyer on behalf of the distributor, by agreement with the buyer of the product, provided that the buyer of the product is not established in Hungary for economic purposes, while it does not, and does not need to, have a Hungarian tax number. Up to now, the Hungarian tax authority has therefore refrained from imposing any default penalties if the taxpayer obliged to provide the invoice data has not, or not properly, complied with the online reporting obligation. Both the legislator and the taxpayers and their partners involved in self-billing were given some time to work out a solution.

What has changed with this amendment?

The solution was finally reached by the end of June. According to the legislative amendment that entered into force on 26 June, if a taxpayer fulfils its invoicing obligation with the help of a proxy, and this proxy is a customer who is not established in Hungary and is not registered for VAT purposes in Hungary in relation to the transaction underlying the invoice, then the online data reporting obligation does not have to be fulfilled from the customer’s invoicing software. The data reporting obligation may also be fulfilled from another computer system, provided that it is carried out electronically via a machine-to-machine connection. The data must be provided within six days following the issue of the invoice or document qualifying as an invoice.

If you want to know how your company will be affected by the changes in the online data reporting of proxy invoicing, including self-billing, please contact the tax experts at WTS Klient Hungary.

A Good news for those who opt for self-billing! bejegyzés először WTS Klient Hungary | tax | accounting | payroll | advisory | HR services | digital solutions | state aid-én jelent meg.

So what are we talking about here exactly? As we previously discussed in detail, online invoice data reporting was introduced in Hungary in July 2018, which meant the automatic online reporting by invoicing software, without human intervention, of data on invoices issued by taxpayers to other taxpayers, and the recording of handwritten invoices in the same system. However, there are currently thresholds to the reporting obligation: the rule only applies to invoices that include VAT of at least HUF 100,000 (roughly EUR 290).

We have also reported in detail about the already implemented and planned changes regarding invoice data reporting, such as the XSD structure used by invoicing software programmes which changed from 1 April, and how the system will change from 1 July and from 1 January 2021. In this article we would like to remind you of the main changes taking effect from 1 July.

Invoice data reporting threshold 

From 1 July the afore-mentioned threshold will drop from HUF 100,000 to 0, which essentially means that after 30 June, all invoices issued to domestic taxpayers (on products/services with Hungarian place of supply) must be reported to the National Tax and Customs Administration (NAV), even if the transaction is subject to the reverse-charge mechanism in Hungary or is VAT exempt.

While this only means setting the HUF 100,000 threshold to zero in the invoicing software for most companies, there will be many entities for whom the VAT on their issued invoices fell short of the threshold so far, or their activity meant that they did not have to issue VAT invoices. (For example, companies trading in agricultural goods, most of whom issue invoices under the reverse-charge mechanism.) These companies generally used handwritten invoices (printed block of invoices) if from time to time they had to issue their taxpaying customers with invoices that had VAT in excess of HUF 100,000. In their case, abolishing the threshold brings a significant change, and what is more, they have to register in the NAV’s system for this and learn phrases such as replacement key, signature key or technical ID. They also have to check whether the invoicing software they use is capable of handling the changes. Companies that only invoice private individuals (not taxpayers) are getting a little more time as they only have to ensure compliance with the invoice data reporting obligation from 1 January 2021. 

Time for issuing invoices 

The time earmarked for issuing invoices from the date of performance will fall from 15 days to 8 days from 1 July. However, this amendment will apply for the first time to invoices with a performance date of after 30 June 2020.

Inclusion of tax number 

From 1 July, invoices must also include the tax number of the domestic taxpayer buying the product or service, more precisely: the invoice must contain the first 8 digits of the taxpaying customer’s tax number – regardless of the amount of output VAT on the invoice. Consequently, the provision of the VAT Act that relates to the mandatory content of invoices has also changed.

Again, this amendment will only apply for invoices with a performance date of after 30 June 2020. If, after 1 July, you accept an invoice subject to the rules on ordinary taxation that does not include the first 8 digits of your tax number, then you can deduct the tax, but only if the performance date is prior to 1 July and the amount of output VAT does not exceed HUF 100,000.

It is important to note that for reverse-charge invoices the entire tax number (11 digits) must be stated on the invoice.

Expansion of invoice-issuing obligation 

From 1 July the following tax-exempt activities will no longer be exempt from issuing invoices:

• other education,
• health-care services not performed as a public service,
• activities performed by dentists and dental technicians,
• services of cooperating groups,
• real estate sales.

New NAV development 

Keeping with the times, or perhaps even getting ahead of the times, the NAV has developed a mobile telephone application for invoice issuing, which could complement the NAV Online Invoice system if invoices are not issued using own invoicing software. This application is already available for downloading, it is completely free and has various functions, such as issuing, modifying and invalidating invoices and prepayment invoices, the automatic performance of invoice data reporting, electronic invoicing, handling partner and product master data, as well as querying outgoing and incoming invoices. Hopefully this will do away with the need for handwritten invoices in many cases, along with the extra administration associated with this.

For companies struggling with this topic we recommend the services of WTS Business Automation Kft. This business line of ours offers support for invoicing software that does not yet have the required data reporting function ensuring compliance with Hungarian laws and regulations, and for developing and operating other solutions related to invoice data reporting. Feel free to contact us.

A Invoice data reporting still to be expanded from 1 July – no deferment! bejegyzés először WTS Klient Hungary | tax | accounting | payroll | advisory | HR services | digital solutions | state aid-én jelent meg.

Mandatory data on invoices

Regardless whether issued by invoicing software, or filled out manually from a printed invoice book, or as an e-invoice, invoices must always comply with the provisions of the VAT Act. The mandatory data content of invoices based on the effective provisions of the Hungarian VAT Act is as follows:

• date of issue of invoice
• date of performance, if different from the issue date
• invoice number
• issuer’s name, address and tax number
• customer’s name, address
• customer’s tax number (for reverse charge transactions, tax-exempt intra-community transactions and for invoices issued for resident taxpayers if the VAT reaches or exceeds HUF 100,000 – roughly EUR 308)
• description and amount of goods / services supplied
• net unit price (without tax) of goods / services supplied
• net value of invoice
• percentage and amount of VAT

Optional data:

• classification of goods / services supplied (customs tariff codes, SZJ, TESZOR codes)
• payment method
• payment deadline

Provisions on data content of invoices in particular cases

In special cases, such as invoices issued in foreign currencies, reverse charge transactions, tax-exempt intra-community transactions, cash accounting or self-billing, the provisions of the Hungarian VAT Act prescribe other mandatory data as well:

• for invoices issued in foreign currencies, the amount of VAT in Hungarian forints
• for reverse charge transactions, i.e. if the buyer of the goods/user of the services is the one liable for the VAT payment, the expression “fordított adózás” (reverse charge) shall be added
• for tax-exempt intra-community transactions, a clear reference to the fact that the supply of the goods / services is exempt from tax
• indicating the phrase “pénzforgalmi elszámolás” (cash accounting) if the taxpayer opted for cash accounting
• indicating the phrase “önszámlázás” (self-billing) if the invoice is issued not by the seller/provider (supplier) of the goods/services, but by the customer/user (buyer) of the goods/services
• in the case of newly-acquired means of transport supplied in the EU without charging VAT, the technical specifications of the vehicle
• indicating the phrase “különbözet szerinti szabályozás – utazási irodák” (margin scheme – tour operators) for the supply of travel organisation services
• indicating the phrase “különbözet szerinti szabályozás – használt cikkek” (margin scheme – second-hand goods) for the supply of second-hand movables
• indicating the phrase “különbözet szerinti szabályozás – műalkotások” (margin scheme – works of art) for the supply of works of art
• indicating the phrase “különbözet szerinti szabályozás – és régiségek” (margin scheme – collectors’ items and antiques) for the supply of collectors’ items and antiques
• if using a fiscal representative, the fiscal representative’s name, address and tax number

Deadline for issuing invoices

In general, invoices have to be issued within 15 days of performance (in the case of advance payments, the day the amount is credited qualifies as the performance date). If payment is made in cash or with non-cash payment instruments, however, the invoice has to be issued immediately. In the case of tax-exempt goods supplied within the community, and services where the user of the service is liable for the VAT, the invoice must be issued no later than by the 15^th day of the month following the performance.

Online data reporting

The online data reporting obligation was introduced in Hungary as of 1 July 2018. The issuer of the invoices is liable for reporting the data in the case of invoices issued to resident taxpayers with a VAT content equal to or more than HUF 100,000 (roughly EUR 308).

If the invoice is issued by invoicing software, the software must have a built-in function to fulfil the immediate data reporting obligation prescribed.

If invoices are issued manually from a printed invoice book, the data must be reported by the issuer of the invoice – generally within five calendar days. If the VAT content of an invoice issued manually exceeds HUF 500,000 (roughly EUR 1,538), the data must be reported the day after the invoice is issued.

Upon failing to comply with the data reporting obligation outlined above, or submitting reports that are incomplete, include mistakes or have false data, a default penalty of HUF 200,000 (roughly EUR 615) per affected invoice may be levied on private individuals, and HUF 500,000 (roughly EUR 1,538) per affected invoice on other taxpayers.

The accountants at WTS Klient Hungary have more than 20 years’ experience in helping the most varied types of client in accounting their invoices, and are as prepared as they can be to handle the challenges of online data reporting. We look forward to hearing from you should you need a reliable team of accountants to provide solutions specifically tailored to your and your company’s needs.

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

Definition of electronic invoices

An invoice can be issued on paper or electronically. Based on the definition set out in the VAT Act an invoice qualifies as electronic if it contains the data prescribed in the Hungarian VAT Act and was issued and accepted electronically. (According to the information booklet on invoices issued by the Hungarian Tax and Customs Administration (NAV), an invoice is only considered electronic if it was sent to the recipient in an email, regardless whether the document is attached to the email via invoicing software or as the scanned version of a paper-based document.)

These invoices do not need to be sent by post, however, there are technical conditions for the entity purchasing the product / using the service with regard to receiving electronic invoices and in relation to the taxpayer’s obligation set forth in the VAT Act in respect of authenticity of origin, integrity of data and readability of the invoice. Consequently, cooperation between the parties is vital for electronic invoicing. As prerequisites for electronic invoices the Hungarian VAT Act prescribes the recipient’s approval (which doesn’t just have to be formal, i.e. it can be implied by payment of the amount on the invoice as well), and a preliminary written agreement between the parties about the use of the EDI (electronic data interchange) system.

Ensuring authenticity, integrity and readability

As we have already mentioned, according to the legislation governing such invoices, the authenticity of origin, the integrity of data and the readability of electronic invoices must be guaranteed. The Hungarian VAT Act provides two ways to comply with these rules:

• the invoice is issued with a qualified electronic signature, or
• it is created and transmitted within the EDI system. There are only two entities in the electronic data interchange system, which means that the authenticity and integrity of the invoice data is ensured by the closed system, which does not allow for unauthorised persons to access data. Electronic signatures are not a basic requirement of the EDI system, however, the parties must agree in advance on the exact format used and the technological background required for this.

When issuing invoices through the electronic data interchange system, prior, written agreement on the application and use of the system is obligatory.

Archiving electronic invoices

Electronic invoices (including those accepted and those issued by the taxpayer) must be stored in electronic format. Stored electronic invoice data might have to be presented during a tax authority inspection. If the storage is carried out pursuant to the rules of digital archiving, a copy of the invoice generated by invoicing software and printed on paper may be retained as electronic data at the issuer.

Invoices issued by invoicing software entail a reporting obligation with regard to the software. Any newly acquired invoicing software must be reported to the Hungarian tax authority within 30 days of the usage on the designated form (“Szamlazo”).

Storing and archiving electronic invoices is governed by the decree on the rules of digital archiving. In line with this decree, the entity subject to safekeeping invoices must ensure the integrity of the electronic document during the storage and make sure it is not damaged, subsequently modified, deleted or prematurely erased.

During their work the accountants of WTS Klient Hungary also prefer to forward and store documents electronically since bearing the requirements of digitalisation in mind we constantly strive to develop modern solutions to enhance the efficiency of work processes and provide data as quickly as possible. We look forward to hearing from you should you need a reliable team with expertise in electronic invoicing.

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

Online data reporting for invoicing was launched in Hungary on 2 July, though we may still see some technical problems in the course of the reporting. WTS Klient Hungary believes it would be useful if the penalty grace period of 1 month, i.e. until 31 July, were somewhat longer, given the processes at companies working with non-Hungarian invoicing systems.

Practical experience with online data reporting for invoicing

Parallel to the system that went live from 2 July, the test system for online data reporting for invoicing is also available, so special-case invoicing can still be run through the test system first to see whether the taxpayer receives a positive or negative response. (Don’t forget that providing incorrect data can leave taxpayers facing substantial default penalties.

Initially there were differences between the invoicing software programmes developed by Hungarian software developers. Most of the developers were successful in their endeavours, and the online data reporting for invoicing worked well right from the outset; others experienced problems with communications in the first weeks. And in some cases it is not easy to identify where the problem is. We feel it is important to note that the law only requires reporting on the data content of invoices, which means the obligation does not relate to other documents, pro forma invoices and receipts produced by accounting systems.

[/et_pb_text][/et_pb_column][/et_pb_row][et_pb_row custom_padding=”0|0px|0|0px” _builder_version=”3.0.47″ background_size=”initial” background_position=”top_left” background_repeat=”repeat”][et_pb_column type=”1_2″][et_pb_button button_url=”https://onlineszamla.nav.gov.hu/login” url_new_window=”on” button_text=”Login link for live system” button_alignment=”left” _builder_version=”3.0.106″ custom_button=”on” button_text_size=”12″ button_text_color=”#ffffff” button_bg_color=”#cc0033″ button_border_color=”#cc0033″ saved_tabs=”all”]
[/et_pb_button][/et_pb_column][et_pb_column type=”1_2″][et_pb_button button_url=”https://onlineszamla-test.nav.gov.hu/login” url_new_window=”on” button_text=”Login link for test system” button_alignment=”left” _builder_version=”3.0.106″ custom_button=”on” button_text_size=”12″ button_text_color=”#ffffff” button_bg_color=”#cc0033″ button_border_color=”#cc0033″ saved_tabs=”all”]
[/et_pb_button][/et_pb_column][/et_pb_row][et_pb_row custom_padding=”9px|0px|22px|0px” _builder_version=”3.0.47″ background_size=”initial” background_position=”top_left” background_repeat=”repeat”][et_pb_column type=”4_4″][et_pb_text _builder_version=”3.15″]

Technical and secondary registrations

The online data reporting for invoicing system resembles the EKÁER system in that here too it is the company’s representative or authorised representative who can set up the primary registration, and they can configure the technical registration as well, which is a prerequisite for M2M communication. Separate technical registration is also recommended for self-billing and in the case of all self-billing structures, while requesting separate technical registrations is advisable too when using various invoicing programmes at the same time. Two types of authorisation can be set during a technical registration:

1. invoice management and invoice queries, or
2. invoice management and own invoice queries

The primary user can also give access to secondary users, and can define the activities that these secondary users can perform.

Access to the Hungarian government portal is not required for secondary registrations, which means, for example, a foreign finance director or foreign experts at international companies can also view the system, check the data reporting, query the list of invoices issued for their company, and authorise their invalidation if mistakes have to be corrected.

Correcting errors

If an original invoice has been issued incorrectly, for example the wrong tax number, VAT rate or net amount, etc. is stated, then in line with Hungarian invoicing regulations a correction document must be issued that refers to the number of the original invoice for the transaction. The system has to record the data content of the original invoice and the correction invoice.

What is important is that errors can be corrected in cases that deviate from the above as well. For example, if the data reporting cannot be processed or if a technical error slips in to the online data reporting for invoicing, then the mistake must be corrected. First of all, the data reporting must be repeated electronically in that the correction must be approved online either by the primary user or by a secondary user authorised for such tasks (i.e. the error can only be corrected [technical invalidation] after a manual step). If the developer cannot resolve the problem within 3 working days for whatever reason, then the data can be reported manually. Do not forget that the manual data reporting also has to take place on the https://onlineszamla.nav.gov.hu/ website in Hungary if the taxpayer uses a printed invoice book to issue invoices instead of invoicing software.

Grace period for penalties

According to information from the Hungarian Ministry of Finance the NAV will not impose penalties until 31 July if taxpayers register themselves in the system for online data reporting for invoicing before issuing their first invoice, and then subsequently load the invoices in by 31 July. The penalties are not to be sneezed at since at any given taxpayer they can total up to HUF 500,000 (roughly EUR 1,500) per incomplete or failed data transfer or invoice.

We will keep our readers updated of the initial lessons learned from the roll-out of the online invoicing system. Please feel free to contact us if you have any questions or comments. Together with our developers we will work on finding solutions for even the most challenging of situations.

[/et_pb_text][et_pb_text _builder_version=”3.0.106″]

RELATED ARTICLES:

Online invoicing in Hungary: you can register in the live system from 18 June

Online data reporting: only 2 months to go!

New draft decree on live invoicing, or online data reporting

[/et_pb_text][/et_pb_column][/et_pb_row][/et_pb_section]

A Online data reporting for invoicing bejegyzés először WTS Klient Hungary | tax | accounting | payroll | advisory | HR services | digital solutions | state aid-én jelent meg.

It looks like the live system of online data reporting will finally be introduced in Hungary from 1 July 2018. Any further extension to the deadline seems quite unlikely, especially given that the EU has accepted the system too. Therefore the documentation available on the NAV’s online test page is not expected to change, and the applicable government decree will soon be announced as well.

What can be expected?

Things will pick up pace in the next few months. This period will be important for developers as well as taxpayers, and we are confident we will only find out how prepared everyone is once the live data reporting system is turned on. We can safely assume it will not be 100% perfect.

Right now the specifications and the XSD scheme are considered final, but they can be altered slightly based on the information coming from taxpayers and testing. All the amendments to the specifications and the system will be announced by the NAV. (Hopefully this will not mean multiple notifications per year).

The online testing system will not be usable as the live system and for the purposes of obligatory data transmission, but it will still be available for taxpayers if they wish to test the system. Registration (primary, secondary and technical) in the live system will probably be available earlier than 1 July. Ideally, you will be able to register in the live system at least 30 or 15 days in advance to avoid the possibility of the first data reporting failing on 1 July due to registration problems. Data may only be uploaded to the live system from 1 July.

[/et_pb_text][et_pb_text _builder_version=”3.0.106″ background_layout=”light”]

[box]Registration of users

The natural persons performing the data disclosure on the platform on behalf of the taxpayer liable to data disclosure are the so-called primary and secondary users, the whole data necessary for the application of the machine-to-machine interface in case of data disclosure performed from the billing software is the so called technical user. It is common for each user that they shall be “created” in the online interface., i.e. users should also be registered, for them – depending on the types – different user rights (privileges) can (and should) be provided. The secondary users and the so-called technical user can be created by the primary user on the interface.

Source: https://onlineszamla-test.nav.gov.hu/tajekoztatas_a_regisztraciorol

[/box]

[/et_pb_text][et_pb_text _builder_version=”3.0.106″ background_layout=”light”]

How prepared are we?

The NAV has been highlighting this new obligation on several platforms in Hungary, but the results of the survey conducted by WTS Klient Hungary at the beginning of this year clearly showed that many taxpayers are still not familiar with all the elements of the system. This obligation is nothing new for chief accountants, tax consultants and employees working in the financial field, but the decision-makers at tax-paying entities do not always know which elements will be obligatory in the final system.

It is a common misunderstanding that data must be reported within 24 hours in the case of invoices issued by a software programme. Hungarian legislation prescribes immediate data reporting with no human intervention. There were several companies in our survey who understood data reporting to be just the online forwarding of the amount on the invoice, whereas in actual fact, all the obligatory invoicing details must be forwarded to the NAV.

The situation is exacerbated at companies where more than one invoicing software programme is used, possibly alongside handwritten invoices as well. For handwritten invoices the invoice data needs to be entered into the online platform within 5 days (in the case of invoices with VAT of HUF 500,000 (roughly EUR 1,600) or more: on the day after the issuance of the invoice). Relief may come for those working with Hungarian accounting software in that the software will likely handle online data reporting by default.

Numerous respondents of the survey indicated that they use invoicing software integrated with their foreign parent company and are only users with no higher-level technical rights. In these cases compliance with online data reporting must be resolved in other ways as the system is expected to be launched, and taxpayers may face a default penalty of up to HUF 500,000 (roughly EUR 1,600) per invoice in the case of inadequate data reporting.

Moreover, the tax consultancy team at WTS Klient Hungary has found that the data exporting function of invoicing software programmes, which has long been obligatory, is often not fully operational either. According to tax consultants, perhaps the greatest problem and challenge is how warning and error messages received during individual cases of incorrect data reporting can be processed and managed.

Our advice on online data reporting

Taxpayers who use foreign accounting software need to find a solution for real-time data transmission to the NAV. Internal and external developments might be necessary to ensure the data reporting functions perfectly, which can be time-consuming, taking up to several weeks. This is why you need to find the right service provider in time.

We strongly recommend testing the online platform since this will be where you will need to make the primary registration for the live system as the managing director or representative of the taxpayer. Primary users will be responsible for registering secondary users and handling the technical registrations as well. In the case of self-billing, suppliers must also be prepared for the upcoming tasks, such as the technical registration.

Appropriate plans and programmes need to be compiled for managing warning messages received during data reporting.

One important prerequisite of successful online data reporting in Hungary is preparing your systems for the change in good time, with joint assistance from IT and tax consultants. Our expert team will gladly help you check your invoicing software.

[/et_pb_text][et_pb_button button_url=”http://wtsklient.klient.hu/en/offer/” url_new_window=”on” button_text=”Online offer” button_alignment=”left” background_layout=”light” custom_button=”on” button_icon_placement=”right” button_text_size=”12″ button_bg_color=”#cc0033″ button_border_color=”#cc0033″ button_text_color=”#ffffff” _builder_version=”3.0.106″ saved_tabs=”all” /][et_pb_text _builder_version=”3.0.106″ background_layout=”light”]

You can download the summary in PDF format here:
WTS Klient Newsflash 04.05.2018. – Online data reporting (PDF)

RELATED ARTICLES:

New draft decree on live invoicing, or online data reporting

Online invoicing from 1 July 2018 Electronic data reporting

[/et_pb_text][/et_pb_column][/et_pb_row][/et_pb_section]

A Online data reporting: only 2 months to go! bejegyzés először WTS Klient Hungary | tax | accounting | payroll | advisory | HR services | digital solutions | state aid-én jelent meg.

The draft legislation on invoicing software has finally been published. Below we provide you with the information you need on this new administrative obligation in an easy to understand Q&A format.

What do you need to report data on?

Electronic data reporting at least covers the mandatory data under the VAT Act, but taxpayers may also provide additional data on invoices, credit notes and correction invoices.

Following the issuance of invoices, what is the deadline for data reporting?

Data must be sent electronically to the state tax and customs authority (“NAV”) immediately, but within 24 hours at the latest. 

Is automatic data reporting possible?

The draft includes the xsd data structure that has to be used when reporting the data on invoices issued by invoicing software. This could facilitate automatic data reporting too.

When will the data reporting obligation become effective?

The amendment is expected to take effect from 1 July 2018, but data may be reported earlier on a trial basis as well.

Why is this needed?

The new electronic data reporting is designed to increase the efficiency of tax inspections, and will probably reduce opportunities for tax evaders. The regulation will be binding only for invoicing software, so it follows that this tool will not be applicable for combating tax fraud involving handwritten invoices (not issued by invoicing software).

What effect will this have on everyday administration?

Data reporting may begin after the taxpayer registers, which involves registering the data reporting end point and the invoicing software too.

Based on a feasibility study of the draft, the automated process means the system should not place any extra burden on businesses aside from the one-off investment cost, and it will replace ex-post reporting at the level of invoices. One further advantage of implementing the system will most probably be that the receiving party can learn about the issuance and content of the invoice almost in real time.

One important precondition for successful online data provision is that the data-export function of the invoicing software works well and includes detailed data structure specified by the related legislation. Our expert team is on hand to check your invoicing software.

[/et_pb_text][et_pb_button button_url=”http://wtsklient.klient.hu/en/offer/” url_new_window=”on” button_text=”Ask for our online offer!” button_alignment=”left” background_layout=”light” custom_button=”on” button_icon_placement=”right” button_text_size=”12″ button_bg_color=”#cc0033″ button_border_color=”#cc0033″ button_text_color=”#ffffff” _builder_version=”3.0.86″ saved_tabs=”all” /][et_pb_text _builder_version=”3.0.86″ background_layout=”light”]

You can download the summary in PDF format here:

Electronic data reporting (PDF)

RELATED ARTICLE:

Online invoicing from 1 July 2018

[/et_pb_text][/et_pb_column][/et_pb_row][/et_pb_section]

A Electronic data reporting – draft legislation on invoicing software programmes now available! bejegyzés először WTS Klient Hungary | tax | accounting | payroll | advisory | HR services | digital solutions | state aid-én jelent meg.

Bookkeeping abroad

The software programmes of integrated systems and service centres are not always harmonised with Hungarian rules, so companies often use the services of Hungarian accountancy firms and tax advisory firms as well. Accountants and tax advisors provide assistance in getting to know Hungarian laws, the tax and accounting treatment of various transactions, and in harmonising processes performed abroad in line with Hungarian legal regulations.

Before an enterprise decides to bookkeeping abroad, the following criteria have to be taken into account:

• According to the Act on the Rules of Taxation, the place where the taxpayer’s documents, electronic accounting receipts and records are kept has to be reported to the tax authority if this location is not the taxpayer’s seat.

• Documents can be forwarded to different places for the period of the bookkeeping and processing, but they have to be presented within 3 working days if so requested by the tax authority. It is important to note that keeping the records abroad based on the taxpayers’ own decision does not exempt them from the obligation to present documents.

• Only a chartered accountant registered in Hungary can prepare the company’s accounts. If the company takes advantage of the opportunity (or, often, the obligation) as per the Act on Accounting, and prepares IFRS financial statements, only an IFRS-certified chartered accountant registered in Hungary can prepare these statements.

• If there is an obligation to conduct an audit because the company’s individual figures exceed the statutory limits, or because it is consolidated and thus automatically becomes obliged to be audited, the audit firm can also request the original documents be available for a certain period due to the need to review accounting records. It is important to mention that an audit of Hungarian companies can only be performed by audit firms or auditors registered in Hungary.

• Tax returns, annual reports and all other reports have to be prepared and submitted to the various Hungarian authorities in Hungarian, therefore these tasks are often performed by the engaged Hungarian accountant or tax advisory firm based on the information provided to them from the integrated system abroad.

• Strict rules apply to the invoicing software used by companies. The software has to be reported to the tax authority in the case of bookkeeping performed abroad as well. In order for the outgoing invoices of a company with its books kept abroad (including intercompany invoicing) to comply with all requirements, it is advisable to use certified Hungarian invoicing software, or to engage a Hungarian accountant or tax advisory firm to issue invoices – based on the invoices issued in the integrated system – that are in line with Hungarian rules and can be sent out to the customer.

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