Hungarian Tax Authority prepares draft VAT returns starting from November 2021

From 12.11.2021, the Hungarian Tax Authority (hereinafter: HTA) will launch its first service to help domestic economic operators to prepare and submit VAT returns (so-called: eVAT). In cooperation with the HTA Central Management, we have had the opportunity to look behind the scenes before the launch of the system, so we would like to provide you with the most important information on the new eVAT return.

The first draft VAT return will be sent out to the taxpayers on 12.11.2021 for the VAT return submission period October 2021. It is important to note that this will be a draft version, which means that, as before, the VAT return will retain its self-declaration format. So, unlike the ePIT (Personal Income Tax) system, the VAT return will have to be completed by submission of the taxpayer. This means that companies will still be able to prepare and submit their VAT returns within the same program and process as before. However, it will be worth keeping track of the information available to the HTA, as it will now be possible to submit VAT returns also via the eVAT system.

The HTA has also confirmed that for the time being this option will be primarily useful for smaller taxpayers, businesses with few invoices, or those with a simple transaction structure. In the future, however, an interface connection will also be set up to enable the draft return to be consulted, so that the VAT analytics held by the companies can be compared with the draft VAT return of the HTA, furthermore, other functions are also planned to help the taxpayers.

Data will be fed into the returns from three currently running Hungarian systems: Real-Time Invoice Reporting system, Online Cash Register data, and the Customs Office database known as CDPS. Therefore, in the future, the data we provide to the Tax Authority will be of high importance, as it will be the basis for the draft VAT return. The HTA has already indicated that in the event of major discrepancies between the eVAT system and the submitted VAT return, the Authority will contact taxpayers for data reconciliation.

It is therefore advisable to be prepared and to make a comparison between the already existing real-time data system, the supplier data in the system, and the own VAT analysis that companies are currently preparing. VGD Hungary is already preparing such automated comparisons as part of its Digitalisation Solutions and IT Consulting service, the results of which will be evaluated by our experts and practical recommendations will be made on possible discrepancies.

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VGD Hungary's team of experts is at your disposal for any questions you may have regarding eVAT returns and related automation and IT possibilities.