THE VALUE ADDED TAX

We would like to give you an overview about the most important amendments to Hungarian law concerning the Value Added Tax, relevant for 2025.

Change of itemized reporting rules

Although from 2025 the amount rounded to one thousand forints will still have to be indicated on the main lines of the so-called M report, the exact amount in HUF for each item need to be reported on the itemized parts.

VAT deduction right

From 2025, domestic taxpayers will also be able to use the right to deduct VAT on goods and services supplied abroad if the transaction would give rise to a right of deduction in the case of domestic supply. 

Individual tax exemption

The personal tax exemption became available for international transactions and distance sales. For the activation of the scheme, a separate declaration must be submitted to the Hungarian Tax Authority. It is conditioned among other things, that the taxpayer's sales must not exceed the EU threshold (EUR 100,000) and the domestic threshold valid for the given country (varying per country, HUF 12 million (approx. EUR 29,300) in Hungary). 

Right to deduct VAT in respect of goods imported through an indirect customs representative

Rules for VAT deduction through customs representative will be strengthened. If the importer is not qualified as being risky taxpayer by the Hungarian Tax Authority and is subject to a monthly declaration, the right to deduct input VAT may be exercised by its indirect customs representative on the imported goods (if the importer is not a reliable taxpayer, only after partner verification). If the importer holds a licence for delayed import VAT assessment and the customs agent is a reliable taxpayer, this procedure may be applied irrespective of the former conditions. The indirect customs representative shall declare the details of the goods per import.

Value added tax on real estate

The reduced VAT rate of 5% for the sale of new residential properties is extended with additional 2 years until December 31, 2026. Moreover, the transitional rules also grant such advantage until December 31, 2030, for construction projects, if the building permit will become final no later than December 31, 2026, on constructions that has been notified by September 30, 2024, on the basis of a simple notification, or it has been acknowledged under the Architecture Act by December 31, 2026.

Further changes

From 2025, the supply of gas by a taxable trader through the natural gas system connected in the territory of the EU will also be subject to reverse charge, i.e. including domestic sellers. From July 1, 2025, rebates granted after completion (e.g. discount, rebate, etc.) may be applied even if only a receipt has been issued for the transaction. Tax base reduction requires an amendment to the receipt. The taxable person shall also have the right to reduce the taxable amount where the refund is not made directly to the final consumer of the goods but to an intermediary. The introduction of the eReceipt system has been postponed by half year to 1 July 2025.