{"id":1847,"date":"2021-01-04T13:29:44","date_gmt":"2021-01-04T13:29:44","guid":{"rendered":"http:\/\/gerey.hu\/EU\/?p=1847"},"modified":"2021-02-05T13:32:03","modified_gmt":"2021-02-05T13:32:03","slug":"%ef%bb%bfsummary-of-amendments-of-tax-legislation-of-the-year-2021","status":"publish","type":"post","link":"http:\/\/gerey.hu\/EU\/%ef%bb%bfsummary-of-amendments-of-tax-legislation-of-the-year-2021\/","title":{"rendered":"\ufeffSUMMARY OF AMENDMENTS OF TAX LEGISLATION OF THE YEAR 2021"},"content":{"rendered":"\n


<\/p>\n\n\n\n

The following is a summary of relevant\namendments\/innovations in 2021, with regards to (1) value added tax and\ncorporate income tax, (2) small business tax and simplified entrepreneurial\ntax, (3) <\/a>local business tax and (4) electronic\npublic road trade control system.<\/em>This summary only contains\nthe major lines of the most significant modifications, <\/em>due to the numerous detailed rules<\/em>. The analysis of the details\ngoes beyond the scope of this newsletter, however at your request we gladly\ngive further information about their essential contents.<\/em><\/em><\/p>\n\n\n\n

\"\"<\/figure>\n\n\n\n

1. VALUE ADDED TAX\nAND CORPORATE INCOME TAX<\/strong><\/strong><\/p>\n\n\n\n

As of 1st<\/sup> January\n2021, the system of online invoice data reporting also applies to invoices\nissued to private individuals and foreigners. The tax authority will also\nprepare the draft of the VAT return for companies, which the taxpayer can\nmodify. <\/p>\n\n\n\n

From January, the scope of\npossibilities for reducing or reclaiming the tax base in relation to\nirrecoverable claims is also extended to claims against private individuals. As\na transitional measure, VAT reclaiming will be possible retroactively back\nuntil 31 December 2015.<\/p>\n\n\n\n

As of 1st<\/sup> July 2021,\nas a general rule, distance sales in the European Union will be taxed based on\nthe VAT rate of the country of destination of the product (the state of\nestablishment of the end-user). In order to lighten administrative burdens, for\nsales not exceeding the value threshold of EUR 10,000 the state of\nestablishment is deemed as the place of performance, though the taxpayer can\nalso opt for taxation under the general rule below the value threshold too.<\/p>\n\n\n\n

In 2020, the corporate tax rate\ncould already be reduced by the amount carried over from the profit reserve to\nthe reserve, but only up to the amount of the profit before taxes. The upper\nlimit of the allowance was HUF 10 billion, which upper limit was abolished as\nof 1st<\/sup> January 2021.<\/p>\n\n\n\n

2. SMALL BUSINESS\nTAX AND SIMPLIFIED ENTREPRENEURIAL TAX <\/strong><\/strong><\/p>\n\n\n\n

The rate of the small business tax (\u201cKIVA\u201d) is reduced to\n11%, while the value limit of KIVA taxpayer status for revenue and the balance\nsheet total is increased to HUF 3 billion, and the value limit for exiting KIVA\ntaxpayer status is increased to HUF 6 billion in 2021. The value limits shall\nbe applied with consideration to the aggregated turnover of the affiliated\ncompanies.<\/p>\n\n\n\n

The most significant change in KATA (simplified\nentrepreneurial tax) taxation is that as of 1st<\/sup> January 2021, if a\ncustomer pays a given KATA-subject enterprise more than HUF 3 million in a\nyear, this customer shall declare and pay tax at a rate of 40% for the amount\nin excess of HUF 3 million. Having regard to this, when engaging sole trader or\ncorporate service providers providing various services to companies (e.g.\ntranslator, interpreter, IT professional, certain marketing services, coaching,\ntrainer, etc.) who (which) are KATA taxpayers, special attention has to be paid\nduring the year to the fact that payments made to such KATA taxpayers are\nsubject to the aforementioned 40% extra tax above the HUF 3 million limit. In\nconnection with this, we recommend a review of the expenses of recent years in\norder so that such expenses can be identified and planned beforehand.<\/p>\n\n\n\n

The above value limit can only be observed if the customer\ncompany (principal) is aware that the contractual partner is a KATA taxpayer.\nFor this purpose, the legislation requires that KATA-payer businesses notify\ntheir business partner regarding their KATA taxpayer status in writing at the\ntime of conclusion of the contract, or in the case of an already existing\ncontractual relationship, until 15 January 2021. This notification may be made\nby any written means (email, postal letter, personal handover of declaration).<\/p>\n\n\n\n

3.  LOCAL BUSINESS TAX<\/strong><\/strong><\/p>\n\n\n\n

Administrative\nburdens related to local business tax will be lightened in 2021 for businesses\nhaving more than one premise in a way that it will be sufficient to send one\nlocal business tax return to the National Tax and Customs Administration (NAV),\nand the municipalities will not need to be notified separately. Further, having\nregard to the economic challenges posed by the coronavirus pandemic, for the\nyear 2021, the rate of the local business tax will be cut by 50% for micro,\nsmall and medium enterprises having a balance sheet total or net revenue under\nHUF 4 billion.<\/p>\n\n\n\n

4. ELECTRONIC PUBLIC\nROAD TRADE CONTROL SYSTEM (EK\u00c1ER)<\/strong><\/strong><\/p>\n\n\n\n

The reporting obligation\nwill fully cease for products that are not risky with respect to EK\u00c1ER, and\nonly so-called \u201crisky products\u201d \u2013 based on the value or weight limit \u2013 will be\nsubject to the EK\u00c1ER. <\/em><\/p>\n\n\n\n

*<\/p>\n\n\n\n

This summary is intended to\nraise awareness and does not constitute legal advice.<\/em><\/strong><\/p>\n\n\n\n

If\nyou have any questions or need further information, please do not hesitate to\ncontact us.<\/em><\/strong><\/em><\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"

The following is a summary of relevant amendments\/innovations in 2021, with regards to (1) value added tax and corporate income tax, (2) small business tax and simplified entrepreneurial tax, (3) local business tax and (4) electronic public road trade control system.<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[],"class_list":["post-1847","post","type-post","status-publish","format-standard","hentry","category-egyeb"],"_links":{"self":[{"href":"http:\/\/gerey.hu\/EU\/wp-json\/wp\/v2\/posts\/1847"}],"collection":[{"href":"http:\/\/gerey.hu\/EU\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"http:\/\/gerey.hu\/EU\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"http:\/\/gerey.hu\/EU\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"http:\/\/gerey.hu\/EU\/wp-json\/wp\/v2\/comments?post=1847"}],"version-history":[{"count":1,"href":"http:\/\/gerey.hu\/EU\/wp-json\/wp\/v2\/posts\/1847\/revisions"}],"predecessor-version":[{"id":1849,"href":"http:\/\/gerey.hu\/EU\/wp-json\/wp\/v2\/posts\/1847\/revisions\/1849"}],"wp:attachment":[{"href":"http:\/\/gerey.hu\/EU\/wp-json\/wp\/v2\/media?parent=1847"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"http:\/\/gerey.hu\/EU\/wp-json\/wp\/v2\/categories?post=1847"},{"taxonomy":"post_tag","embeddable":true,"href":"http:\/\/gerey.hu\/EU\/wp-json\/wp\/v2\/tags?post=1847"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}