Hungary changes rules for tax invoicing

Tamas Vekasi from Ernst & Young mentioned in this post that the Hungarian Minister for the National Economy has published a decree changing the rules for tax invoices and cash receipts and the rules related to tax authority audits of invoices stored in electronic format. Although the decree came into force on 1 July 2014, certain provisions apply with effect from 1 October 2014 or from 1 July 2015.

According to Tamas Vekasi, the most substantive change under the decree is that enterprises now have an obligation to provide information to the tax authority about the software they use for issuing tax invoices and that this obligation extends to taxpayers who use online invoicing systems.

In its article, he summarize the changes to the rules on the identification of invoices and cash receipts, which affect a large number of businesses operating in Hungary:

  • Invoicing software may be sold only to registered taxpayers.
  • The user of the invoicing software should possess detailed documentation about the software
  • The invoicing software should perform only functions that are detailed in the user documentation.
  • Software users have report to the tax authority when they begin and cease to use invoicing software (and provide other data, as set out in the decree). The decree prescribes different data content requirements for invoicing software and for online invoicing systems.
  • The definition of computer-generated cash receipts applies equally to receipts issued electronically and in paper format.
  • A taxpayer who is required to comply with its invoicing obligations by using a cash register may not issue computer generated cash receipts instead.
  • If the parties to a transaction intend to create and forward electronic invoices using the EDI system, they can comply with the obligation to have a prior written agreement — as set out in the relevant provisions of the VAT Act regarding the application and usage of EDI — by concluding a contract as prescribed in Annex 1 of the decree.




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