UPDATE 11/06/2019: As of 0:00 o’clock of 4 June 2019, National Tax and Customs Administration of Hungary, receives the data of the invoices only in the new format, according to XSD version 1.1. From that date, data can no longer be reported with version 1.0.
All taxpayers have to use the version 1.1 from the 4th of June onwards to supply invoice data until the introduction of version 2.0, with the following restrictions:
Version 1.1 is available in test and live environment from January 2019.
From 4th of June 2019, XSD 1.0 is no longer be used for data supply . Invoice data supplies sent through this version will be rejected without processing.
Draft Version 2.0 was published at the end of April 2019.
Official version 2.0 is expected to be published by NAV in June 2019.
NAV will provide a test environment for version 2.0 from September 2019 onwards.
Go-Live date for version 2.0 will be obligatory for all companies from January 1st 2020 onwards.
If an invoice is reported in version 1.1, the modification of the same invoice has to be in version 1.1 or higher. Modified invoice cannot be reported in version 1.0
Taxpayers must send the invoice data to the NTCA (National TAX and CUSTOMS Administration) without human intervention, via the public internet immediately, after preparation of the invoice.
The obligation affects all invoices that contain at least 100,000 HUF in VAT. This is approximately 320 euros. It will also affect foreign companies registered in Hungary for VAT purposes.
The standard used for the generation of this report will be an XML.
Connection with the Hungarian Tax Authority (NAV) will be via web service. The NAV returns a status report on each invoice sent.
Failure to comply with this law can lead to fines of up to 500,000 HUF (€1,600 per invoice).
This new system will affect the internal procedures in companies when registering and preparing the information to be sent. Carrying out these tasks for each invoice received can mean spending a large amount of human resources and time on these tasks. But there are technological solutions that can guarantee compliance with the immediacy demanded by the regulation.
How to automate the generation and sending of e-VAT?
The solution consists of automating creation of the XML file from the ERP and the subsequent sending to the tax authority through the connection required by the same.
EDICOM, as a specialized technological partner, is able to perform the entire process automatically to avoid major changes in the in-house procedures of companies. The flow would take the following steps:
Data capture: EDICOM’s solution automatically takes the invoice data required by the administration from the client’s ERP.
Generating the structured XML file.
Connection with the Hungarian Tax Authority: Automates forwarding of the previously validated file for registration and authorization by the administration.
Reception and archiving of acknowledgments and integration in the ERP.
The entire process is automatic, performed in a matter of seconds and totally transparent to the user. This means that accounting and admin departments can continue to work from their usual management systems.
In addition, the EDICOM Platform is not only ready for e-VAT returns, but also for e-Invoicing and any other business or tax communications.
Other current e-VAT systems
In Spain, on July 1, 2017, a similar system was launched, called SII. In this case, the companies have 4 days from the issuance or receipt of the invoice to declare the taxes. They do so directly to the Tax Agency’s electronic office, which returns the corresponding acknowledgments.
Lithuania has rolled out a smart tax administration system designated i.MAS. This modernization initiative is based on three areas: the e-waybill (i.VAZ), e-invoicing and VAT returns (i.SAF), and the electronic tax audit (i.SAF-T) file.
In Poland, the Ministry of Finance requires taxpayers to declare their VAT records electronically through the JPK_VAT file. The JPK_VAT file, which includes the company’s purchases and sales VAT records, must be submitted by day 25 of each month.
White Paper on e-VAT returns worldwide
In general, tax agencies around the world are moving towards electronic tax compliance. However, in a global market like today’s, each country continues to issue its own standards. This hampers the adaptation of companies that find technology both a challenge and an opportunity, in equal measures. To this end, EDICOM has published a free white paper explaining how to issue an electronic VAT return in each world region.
Our Global VAT Compliance Expert Analysis (available in English and Spanish) is a resource for companies operating in several countries or intending to do so. Through it, you can find out how the indirect tax VAT works, how it is regulated and what its implications are both for companies and tax authorities.