Hungarian VAT rates and VAT compliance
Hungarian VAT rates
It is important that the correct Hungarian VAT rates are used in accounting records and on invoices as companies are held directly liable for any errors. The European Union does set the framework for the use of VAT rates, but countries are still free to set their own headline rates.
The current Hungarian VAT rates are:
Hungarian VAT rates
|Rate||Type||Which goods or services|
|27%||Standard||All other taxable goods and services.|
|18%||Reduced||Certain foodstuffs; some take away food; admission to certain open-air concerts; hotel accommodation.|
|5%||Reduced||Certain foodstuffs; pharmaceutical products (intended for human use); some medical equipment for disabled persons (excluding repair); books (excluding e-books); newspapers and periodicals; some social housing; district heating; some supplies of new buildings; restaurant and catering services (food prepared on site and non-alcoholic beverages); internet access services; certain writers and composers services.|
|0%||Zero||Intra-community and international transport.|
Hungarian VAT compliance
Once in possession of a Hungarian VAT number, there are compliance rules which must followed on accounting and VAT rates. These includes:
When providing local supplies under a Hungarian VAT number, companies are required to follow local accounting and tax rate rules. These include:
- Detailing information about the supplier and customers, and transactions costs etc on all invoices
- Issuing full invoices in accordance with the Hungarian VAT Act
- Issuing invoicing for goods or services in accordance with the Hungarian time of supply rules.
- Processes and control issues for the use of electronic invoices
- Maintenance of book, which must be retained for at least eight years.
- Treatment of credit notes, correcting VAT returns etc.
- Translation rates for foreign currency invoices
What is the tax point for Hungarian VAT
The tax point (time of supply) rules in Hungary Republic determine when the VAT is due. It is then payable to the tax authorities 20 days after the VAT reporting period end (monthly or quarterly).
For most goods, it is the time of delivery or passage of title. For services, it is the completion of the service.
Latest Hungarian news
January 25, 2019
The European Commission (EC) has proposed switching from unanimous to majority voting on EU VAT and other tax policies. The aim is to progress fiscal reforms which face immovable opposition from just a limited number of member states.
January 09, 2019
The EU VAT Directive has been updated from 1 January 2019 to introduce a voluntary generalised reverse charge measure on domestic transactions in member states.
December 28, 2018
Following agreement by EU member states to permit cutting the VAT rate on e-books and online journals to match the reduced/zero rating permitted on their paper-based equivalents, the following countries have already announced reductions...
- Czech Republic
- United Kingdom