The publications below help navigate our clients through a series of taxation issues by providing the right answers to meet their needs, as well as an overview of expert views on current tax issues.
For specific queries or advice regarding any of the topics covered, please contact our tax professionals who will be happy to assist you. Click on one of the following links for more details about any specific publication.- Ernst & Young Tax News
- Special Editions
- Special Editions: Tax Law Amendments
- Special Editions: Recent Developments in Local Business Tax
- Transfer Pricing Series
- Human Capital Flyer
- EU Tax News
- Other publications
Ernst & Young Tax News
“Ernst & Young Tax News” provides up-to-date information on Hungarian, EU and other international tax issues. If you have any questions regarding the topics covered in the newsletters, or any other taxation matters, please contact our tax professionals who will be happy to assist you.
Please sign here if you would like to receive the latest issue, as well as future editions of our tax newsletter.
April - May 2008 Issue (
471 kB)
Since May is the deadline for the filing of several different tax returns (e.g. corporate income tax, solidarity surtax, local business tax, innovation contribution, personal income tax), in our current newsletter we present some of the topics which should be taken into account when preparing your tax returns.
March 2008 Issue ( 411 kB)
Just two months after the tax law changes entered into force, due to problems of practical application of certain rules, it became necessary again to amend some of the
tax laws. The tax package (passed by the Parliament on 10 March 2008) primarily concerns the new VAT Act, but also features certain provisions of the Act on Tax Procedure and the Act on Local Taxes. The most important changes to tax legislation are summarized below.
January-February 2008 Issue ( 409 kB)
Supreme Court decision on VAT-deduction ban relating to state aid Pursuant to the Hungarian legislation in force until 31 December 2005, input VAT on asset investments or activities financed from state aid were not fully deductible.
December 2007 Issue ( 420 kB)
May we kindly remind our clients that taxable persons who pay according to the calendar year must top-up the taxes below (i.e. pay the difference between the tax advance paid and the expected amount of tax for 2007) by 20 December 2007: corporate income tax, solidarity surtax of corporations, local communal and business tax, bank surtax. Also by the above date, taxpayers must file a tax return reporting the amount of corporate income tax top-up obligation they have been required to make.
October 2007 Issue ( 577 kB)
On 28 September 2007, the Government submitted a bill Parliament amending the tax legislation. The most significant change relates to the creation of the new VAT Act.
June 2007 Issue ( 454 kB)
In this addition of the newsletter, we go into detail with respect to developments in the Hungarian Local Business Tax case. The case has become a hot topic yet again, as the European Court of Justice (ECJ) sets the date for the hearing of the preliminary ruling request of the Zala County Court and the Supreme Court of Hungary on 28 June 2007.
April-May 2007 Issue ( 470 kB)
Since May is the deadline for the filing of several different tax returns (e.g. corporate income tax, solidarity surtax, local business tax, innovation contribution, personal income tax), we present some of the topics which should be taken into account when preparing your tax returns.
March 2007 Issue ( 483kB)
The top tax news of March 2007 was the official investigation initiated by the European Commission on 21 March 2007 regarding the state aid compatibility of the Hungarian intra-group interest taxation regime. We also report on the situation of Hungarian minimum tax after the annulling resolution of the Constitution Court, as well as we discuss a number of interesting tax authority guidelines. Our current edition again presents the latest news concerning government cash grant programmes.
January-February 2007 Issue ( 623 kB)
Our January - February 2007 newsletter outlines regulations pertaining to the determination of arm’s length pricing by the Tax Authority (“advance pricing agreement”), effective as of 1 January 2007. In addition, we highlight two guidelines published recently by the Tax Authority and we provide an account of the recent decisions of the Constitutional Court in relation to the tax law package adopted last summer. The newsletter also presents the latest developments concerning government cash grants and EU tenders. The international tax news section focuses on the ECOFIN Agreement, relating to VAT and excise tax, and a change in German legislation that may affect Hungarian companies organizing fairs, exhibitions and conferences in Germany.
December 2006 Issue ( 367 kB)
The main focus of the December 2006 issue is the “mini tax law package” adopted by Parliament on 18 December 2006. Contrary to expectations the bill contains not only clarification of the legislation passed in the summer, but also entails some substantial changes. We also give you a summary of the recent resolutions of the Constitutional Court concerning tax legislation. The third part of the newsletter includes a year-end reminder of tasks to be done and of important changes.
October-November 2006 Issue ( 638 kB)
The October-November 2006 issue provides a detailed overview of the smaller tax law amendment bill (submitted by the Government on 8 November), aimed at clarifying the legislation passed in the summer. In addition, our newsletter deals with the decision of the Constitutional Court concerning Petty cash tax, the new developments in telephone tax, and the new grant and procedural regulations relating to development tax allowance. In our regular "EU and International Tax News" section, we focus on the decision of the European Court of Justice (ECJ) which includes a condemnation of Hungary with regard to registration tax. We also provide an update concerning key issues such as the impending double tax treaty between Germany and Hungary and the planned tax rewards for energy-efficient consumption; in addition, we offer information on the new combined nomenclature.
September 2006 Issue ( 380 kB)
The newsletter continues to analyze the most important tax law changes and gives you an update on the recent developments and practical information. We also highlight some of the less known details of the tax law changes, such as changes in the customs and the and excise legislation.
July-August 2006 issue ( 315 kB)
The main focus of the July-August 2006 issue is the preparation for the practical implications of the tax law changes which were enacted in July 2006 and take effect from 1 September 2006. In addition, the newsletter gives a detailed overview of the special focus areas of Tax Authority audits. The publication also features hot topics such as the constitutional and EC law aspects of the tax law amendments, as well as the latest developments concerning the local business tax (LBT), among others.
Issue 6 (April-May 2006 265 kB)
The sixth issue provides information on the launch of the electronic tax and contribution returns effective 12 May 2006. In addition, the publication also reports on the following Hungarian tax news:
- Tax Authority’s interpretation concerning the classification of companies for innovation contribution purposes
- New rules related to liquidation
- Obstacles in the tax implications of factoring
Issue 5 (February-March 2006 321 kB)
The fifth issue provides information on the auditing tasks of the Tax Authority for the year 2006. In addition, the publication also reports on the following Hungarian tax news:
- Annulled provisions in the budget act of year 2005
- Local business tax developments in the EU and in Hungary
- VAT deduction relating to state subsidies
- Replacement of lost invoices
- Handling of payment in Euro with cash-registers
Issue 4 (January 2006 521 kB)
The fourth issue provides information on the guideline on qualifying contracts forming the basis of employment. In addition, the publication also reports on the following Hungarian tax news:
- Practical issues raised with respect to the VAT-rate cut
- Accepted changes related to the monthly tax return filing obligation of employers and employees
- Elimination of the retroactive VAT registration
- Application of VAT-exempt import titles
- Expected customs audits of certain consumables’ distributors
- Hungarian tax laws not in line with EU-directives
- December 2005 amendment of the Act on CIT
Under "EU and International Tax News" you will find the latest information on the European Court of Justice’s (ECJ) second oral hearing in the IRAP case, reduced EU VAT rates and the Home State Taxation Proposal announced by the EU. The publication also provides an overview of measurements in Spain following the ECJ’s decision on VAT-deduction related to state subsidies.
Issue 3 (December 2005 352 kB)
The third issue provides information on the new tax return obligation for employers and disbursers, which is only expected to enter into force from 1 April 2006. In addition, the publication also reports on the following Hungarian tax news:
- Increased tax authority scrutiny
- Two Hungarian regulations that contradict EU Directives
- Bill regulating fourth pillar of the pension system
- Electronic invoicing
- Double tax treaties
- Expected changes in relation to state grants based on individual government decisions.
Issue 2 (September-October 2005 200 kB)
The second issue includes a special focus on the European Court of Justice’s decision on VAT deductions related to State subsidies. Our newsflash reports on the following Hungarian tax news:
- VAT-rate cut
- Proposed amendments to tax laws and the Accounting Act effective from 2006
- Mid-year amendments to the Tax Procedure Act
- Changes to crash grant programs
- New data-supply obligations with respect to interest payments to individuals
Issue 1 (August 2005 192 kB)
This first issue includes a special focus on the increase in the social security liability for fringe benefits and foreign-sourced income. In addition, our newsflash examines:
- Changes in Hungarian development tax allowance requirements
- Interpretations of penalty rules related to missing transfer pricing documentation
- Developments in the Hungarian local business tax issue
- Hungarian tax regulations in conflict with EU directives
Special Editions
Newsflash: Individual cash grants for investments exceeding EUR 10 million (February 2006)
 | As of 25 January 2006, investments in assets exceeding EUR 10 million may receive a non-refundable cash grant from the Government through individual negotiations. For more details, please read our newsflash. Download ( 166 kB)
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Special Edition: Corporate income tax base deduction for group-financing activities – EU developments (December 2005)
 | In December, some possibly misleading articles were published in the press about the corporate income tax base deduction for group-financing activities, questioning the future of this allowance. The newsflash describes its current status and explores the potential outcomes. Download ( 429 kB)
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Special Edition: Extraordinary Tax Authority Audit of Transfer Pricing Documentation (November 2005)
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| In November, the Hungarian tax authority called upon certain taxpayers with the largest tax capacity to complete a questionnaire with respect to the 2005 transfer pricing documentation. The special edition of the Ernst & Young Tax News summarizes some key points when filling out the questionnaire, as well as important issues with respect to the tax authority audit which one may need to be aware of. Download ( 310 kB)
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Special Editions: Tax Law Amendments
Ernst & Young Tax News Special Edition: Tax Law Changes as of 1 September 2006
The Special Edition of Ernst & Young’s Hungarian Tax News outlines the new tax law changes effective 1 September 2006, which were approved by the Hungarian Parliament on 10 July 2006. The publication summarizes the changes to the Act on Tax Procedure and provides an overview of tax changes in the following fields:
- Corporate Income Tax
- Solidarity Surtax
- Local Business Tax
- Value Added Tax
- Personal Income Tax
- Social Security and related contributions
- Other taxes
331 kB)Download in German (
360 kB)
Ernst & Young Tax News Special Edition: Proposal for Tax Law Changes from 1 September 2006 (June 2006)
 | A Special Edition of Ernst & Young’s Hungarian Tax News provides a summary of proposed tax law changes. On 10 June 2006, the Hungarian government submitted a bill to Parliament including a number of austerity measures that affect almost every Hungarian taxpayer, including individuals and corporations. The measures, unless otherwise stated, are planned to be implemented from 1 September 2006 or during 2007 and 2008. Download ( 438 kB)
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2006 Tax Law Amendments Adopted (November 2005)
| On 7 November 2005, Parliament accepted the 2006 tax law amendments after introducing modifications to the original proposal. The latest Special Edition of the Ernst & Young Tax News covers those changes that affect the widest group of taxpayers, as well as possible business impacts. Download ( 301 kB)
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Special Edition: Proposed Hungarian Tax Amendments (September-October 2005)
| This special edition of Ernst & Young Tax News provides a detailed overview of the fiscal law amendments package submitted to Parliament by the Hungarian government on 19 September 2005. The changes, upon approval by Parliament, will mostly take effect on 1 January 2006. Download ( 217 kB)
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Special Edition: Simplification of the Hungarian Tax System (May 2005)
 | This special edition focuses on the Hungarian government’s “simplification package,” which became law on 10 May 2005, and deals with corporate income tax, VAT and personal income tax issues, among others. Download ( 116 kB)
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Tax Laws Amendments 2005
| Ernst & Young's publication provides an overview of the most important tax law changes in 2005. The topics covered in the newsletter are dividend tax, corporate income tax, VAT, personal income tax and social security, among others. Download ( 447 kB)
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Special Editions: Recent Developments in Local Business Tax
3rd Special Edition: Recent Developments in Local Business Tax (March 2006)
 | Ernst & Young’s Newsflash provides an update on recent developments regarding the Local Business Tax (LBT) in Hungary, as well as in the EU. Download ( 264 kB)
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2nd Special Edition: Recent Developments in Local Business Tax (November 2005)
| Ernst & Young’s Newsflash provides an update on recent developments regarding the Local Business Tax (LBT) in Hungary, as well as in the EU. Download ( 139 kB)
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Special Edition: Recent Developments in Local Business Tax (July 2005)
| The Local Business Tax (LBT) is most likely to be against the EU rules and thus, since EU accession on 1 May 2004, has been illegally levied. Ernst & Young’s tax newsflash provides an update on recent developments regarding the local business tax issue in Hungary. Download ( 115 kB)
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Transfer Pricing Series
Consolidated Transfer Pricing Documentation (October 2005)
| According to the main rule, transfer pricing documentation has to be prepared for each separate contract. This represents an enormous administrative burden for the taxpayer if there are many contracts. However, in certain cases, consolidated or simplified transfer pricing documentation may be prepared, significantly reducing administrative requirements. Download (in Hungarian, 274 kB)
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Tax authority findings relating to transfer pricing 2. (July 2005)
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| The Tax Authority is paying increasing attention to prices between related parties (known as “transfer prices”). In the second article of our series on transfer prices, we would like to illustrate the audit practice of the Tax Authority with a case study. Download (in Hungarian, 260 kB)
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Tax authority findings relating to transfer pricing (July 2005)
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| Due to the implementation of the transfer pricing documentation requirements as of 1 September 2003, transfer pricing issues have a tendency to be in the spotlight during tax authority inspections. The first two articles of our transfer pricing-related series describe two specific cases in which the Tax Authority challenged the applied related-party prices. Download (in Hungarian, 242 kB)
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Human Capital Flyer
Issue 4 (January 2006)
| The January 2006 issue gives an overview of changes in the reporting of non-Hungarian assignees as of 2006, as well as tasks to be done with respect to the 2005 reporting obligation.
Download ( 180 kB)
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Issue 3 (December 2005)
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| The December 2005 issue gives an overview of, among other things, the planned changes to the Act on Labor Inspection, and reports on the new “EU card” which was introduced as of 1 November 2005.
Download ( 227 kB)
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Issue 2 (September-October 2005)
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| The September-October 2005 issue focuses on, among other things, changes in the Tax Procedure Act in relation to employers' and disbursers' tax return filing obligations. In addition, it outlines administrative rules related to changes in the taxation of foreign-sourced income.
Download ( 214 kB)
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Issue 1 (July 2005)
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| The July 2005 issue provides you with an overview of the amendments to the Hungarian social security legislation effective 1 September 2005. The changes, with illustrative examples are concerned with fringe benefits and income received from foreign sources, among others. Download ( 219 kB)
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EU Tax News
| Ernst & Young's EU Tax News is a bi-monthly review of EU tax and legal developments affecting businesses in the enlarged European Union. 
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Other Publications
Globalization Increases Complexity of Transfer Pricing
| The increase in cross-border business investment by multinational enterprises (MNEs) in Eastern Europe and Asia is presenting new transfer pricing challenges, according to Ernst & Young's „Global Transfer Pricing Trends, Practices, and Analysis," ( 1,9 MB) the second of three Ernst & Young 2005-2006 Global Transfer Pricing Surveys.
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ECJ Decision: VAT Deductible on Investments Financed from State Subsidies (October 2005)
| The VAT is deductible on investments financed from state subsidies according to the European Court of Justice’s decision made on 6 October, 2005. Learn more
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Hungary: One of the most attractive European film locations
| Hungary’s attractiveness for filmmakers is based on relatively cheap labor and hosting costs, a large pool of professional talent, and most recently, a new film-tax incentive regime, which enables film producers to save up to 20% of their production budget if it is spent in Hungary. Learn more by downloading “Tax Incentives for Films in Hungary.” Download ( 510 kB)
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Financial Services Industry Expects Increased Transfer Pricing Risks
| Transfer pricing is central to the management of tax risk in the financial services industry, according to Ernst & Young’s latest research. Tax authorities in many countries have challenged transfer pricing policies on a wide range of issues. More than 80% of Ernst & Young’s global survey respondents from financial institutions expect this trend to increase in the next two years. | ||
| More information can be found in the press release. |
Emission Trading - Hungarian Tax Developments (May 2005)
| Ernst & Young’s new publication examines Hungarian tax developments in the field of emissions trading. It includes the preferential corporate income tax treatment of emissions trading as well as the VAT treatment. Download ( 101 kB)
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Resources under pressure (June 2005)
| Ernst & Young’s latest survey ‘Resources Under Pressure – Delivering More With Less’ sets out to explore how tax departments in Europe respond to the operational issues created by major changes in the corporate environment, and to identify key emerging trends and best practices across the continent. It also makes cross-border comparisons between the attitudes exhibited within Europe and between their respective strategies designed to deliver ‘more with less’. The survey was carried out among 150 tax and finance executives at large multinationals across eight EU countries. Download ( 536 kB) |
Worldwide Corporate Tax Guide
| The 2005 edition of Ernst & Young’s flagship technical tax publication, the Worldwide Corporate Tax Guide draws on the vast knowledge and experience of our tax professionals in more than 150 countries. It provides comprehensive information about:
Download ( 193 kB)
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