Changes in the real time online invoice reporting

Dear Clients! Dear Readers!

In our current Newsletter the changes of the endorsed online invoice data reporting (SAFT) which will come into force as of 1 July 2020 and 1 January 2021 are introduced.

Pursuant to the regulations in force the obligation to provide invoice data applies to invoices issued by a resident taxpayer whose:

• VAT of an invoice exceeds HUF 100,000
• the buyer is a taxpayer who has a Hungarian tax identification number

The extension of the regulation will be carried out in two steps:

First step – as of 1 July 2020

HUF 100,000 threshold will be annulled. Thus, in the period between 1 July 2020 and 1 January 2021 one criterion will remain: data shall be served about all invoices which were issued by

• the customer who is a taxpayer with a Hungarian tax identification number.

Due to the annulled HUF 100,000 threshold VAT-exempt invoices shall also be reported, and the invoices subject to domestic reverse charge – regarding the public interest nature of the activity, the invoices issued by a VAT - exempt (previously exempt) and the exempt taxpayer will also become reportable.

During the transition period between 1 July 2020 and 1 January 2021 the invoices

• issued by private individuals
• intra-community transactions
• export invoices

shall not be reported.

So that the invoice issuer should be able to fulfil his reporting requirements, he has to know the buyer’s tax identification number. Consequently, as of 1 July 2020 the buyer’s tax identification number, independently from the VAT content of the invoice shall be indicated on each invoice.

Second step – as of 1 January 2021

As of 2021 data services will be extended to such an extent that only exceptions to the law will be specified.

All the invoices shall be reported, except:

• issued invoices about the supply of goods or provision of services where the place of performance is a different Member State of the Community, where, regarding the supply of goods or provision of services, the taxpayer’s chargeability to tax is performed according to the special rules of the Act on taxpayers who may perform services remotely in accordance with the Mini One Stop Shop rules.

Consequently, all invoices will be subject to reporting, including:

• invoices issued for private individuals (data services will not include personal data of the buyer
• invoices issued on intra-Community supply of goods and provision of services and
• invoices issued on export sales.

As of 2021 on the basis of reporting the Hungarian Tax Authority will prepare the draft of VAT returns for taxpayers.

The details of this have not been publicised by the Hungarian Tax Authority yet.

Summary statement (M sheet)

Simultaneously, the threshold of HUF 100,000 of the domestic purchase invoice report will also be annulled as of 1 July 2020. Thus, every invoice has to be included into the summary statement of the VAT return VAT. On sheet M VAT-exempt invoices shall not be shown.

The total taxable amount and VAT shown in the accepted invoice will still have to be included in the summary statement, independently from the fact if the receiver of the invoice partially exercises his right to deduct VAT.

The rules of performing data services

The rules of performing invoice data reporting will remain unchanged:

• data on the invoices issued by accounting software shall be automatically transmitted immediately after being drawn up
• if the reverse charge on the manually issued invoices exceeds HUF 500,000 within one calendar day, in other cases within four calendar days after the issuance shall the data reporting be performed.
  In case of failing to comply with reporting the penalty will not change either. The maximum default penalty for an individual entrepreneur is HUF 200,000 per invoice, HUF 500,000 per invoice is for any other taxpayer.

Due to the extension of invoice reporting, there will be more obliged taxpayers, who have not had developed their systems for performing data transmission yet, it is worth considering how to perform the new obligations.

Please, do not hesitate to contact us regarding any questions in connection with setting up or developing systems performing invoice data reporting.

Kind regards,

ABT Treuhand Group