VAT Hungary 2024 – everything you need to know about VAT in Hungary

VAT in Hungary - 27% standard rate

As mentioned earlier, it’s crucial to recognise that Hungarian VAT boasts the highest rate among EU member states.

Hungary’s standard VAT rate stands at 27%, and it applies to nearly all services and products that do not qualify for reduced VAT rates. To illustrate, here are some examples:

• Food and beverages,
• Electronics, audiovisual, and home appliances,
• Cosmetic and hygiene products,
• Clothing and footwear,
• Furniture and home furnishings,
• Hotel and gastronomy services,
• Services related to culture and entertainment,
• Construction and renovation services,
• Legal and accounting services.

First reduced VAT rate in Hungary - 18%

18% VAT in Hungary applies to a small number of products and services. These include:

• selected types of milk,
• selected dairy products,
• cereal products,
• flour,
• starch,
• services enabling access to music and dance events.

Second reduced VAT rate in Hungary - 5%

Another reduced VAT rate in Hungary stands at 5%, and its application extends to a much wider array of services and goods compared to the ones covered by the 18% rate. The 5% VAT rate in Hungary applies to:

• new residential properties,
• selected pharmaceutical products,
• audiobooks,
• printed books and newspapers,
• selected products from the animal sector: eggs, poultry, sheep, etc.,
• internet access services,
• local gastronomic services.

0% VAT in Hungary

0% VAT in Hungary applies to:

• passenger transport services and intra-community and international transport,
• work related to goods that have been purchased or imported into the country and then exported outside the EU,
• financial and insurance services,
• medical, cultural, and sports services provided as public services.

When are foreign companies required to register for VAT in Hungary?

Hungary, being an EU Member State, mandates VAT registration in specific scenarios.

The first situation necessitating VAT registration is when you store goods within Hungary, whether for providing fulfilment services or for owning warehouses. In such instances, VAT registration in Hungary is mandatory.

The second scenario involves the obligation to settle VAT in Hungary when a company exceeds the threshold of total sales to EU countries under the CTSO, which is EUR 10,000. If, after surpassing this limit, sales are made to a Hungarian recipient, VAT must be settled there.

For this option, VAT settlement can be carried out either through the Hungarian Tax Office or by utilising the VAT OSS procedure. The VAT OSS procedure simplifies VAT settlement for e-commerce companies across all EU member states in one consolidated process.

Apart from the situations mentioned earlier, VAT registration in Hungary is also required in the following cases:

• when the company carries out intra-Community supplies,
• when the company’s business activity involves organising events in Hungary,
• when the company supplies goods to EU countries through Hungary.

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VAT registration in Hungary

VAT registration in Hungary occurs at the regional tax office, resulting in the issuance of a Hungarian VAT number upon successful completion of the registration process.

It’s important to highlight that non-EU resident taxpayers must appoint a tax representative, whereas entities within the European Union have the choice to do so or not.

The data and documents required for VAT registration

In Hungary, for a successful VAT registration, the entrepreneur needs to provide the necessary documentation. These include:

• A copy of the VAT certificate in Hungarian, confirming that the company is registered for VAT in another EU country,
• Articles of association,
• Extract from the national register,
• Statement regarding the area of business operations relevant to the company, in Hungarian,
• The signature of the company’s representative,
• Power of attorney, in case the services of a tax representative are employed.

Deadlines for filing VAT returns and paying VAT in Hungary

The deadline for submitting VAT returns in Hungary is on the 20th of the month following the conclusion of the accounting period. This timeline applies to both quarterly and monthly VAT returns.

In contrast, taxpayers are required to file annual returns by the 25th of February.

Intrastat in Hungary

In Hungary, you’re required to file an Intrastat declaration when the total value of your sales of goods and services within intra-Community transactions exceeds 170,000,000 forints (approximately €460,000) for imports and 100,000,000 forints (approximately €270,000) for exports.

Additionally, check out the Intrastat thresholds for the year 2024 in other EU Member States.

Address of the NVA

In Hungary, you initiate VAT registration by applying to the Directorate of Priority Taxpayers, which can be found at the following address:

Kiemelt Adózók Igazgatósága,
Dob utca 75-81, 1077 Budapest.

Support with VAT registration and accounting in Hungary

As specialists in VAT Compliance, we provide comprehensive assistance for all aspects of VAT registration, declarations, and settlements across Europe. Whether you’re considering entering the Hungarian market or already have a presence there and need VAT-related support, we invite you to schedule a free consultation with our team.

Additionally, if you’re eager to expand your knowledge, you can check out our articles covering various subjects on Belgium, Bulgaria or Romania, as well as the applicable VAT rates in EU countries for 2024 or Incoterms 2020. Read also about VAT registrations in Belgium, France, Germany, Spain, Ireland, Italy, the Netherlands, Sweden and the UK or check out some other topics:

• What is the split payment mechanism?;
• Multichannel and omnichannel strategies in e-commerce;
• How to obtain an EU VAT number?;
• What is Amazon Brand Registry?;
• 6 benefits of cooperating with a VAT Compliance specialist.