Changes in taxation deadlines – Measurements of the Hungarian government to eliminate economic damages IV.

New decrees of the Hungarian Government have been published on the 21st of April 2020 including further measurements to eliminate economic damages of coronavirus. The orders contain among others the postponement of different tax returns and tax payment deadlines to 30th of September, 2020, changes in the beneficial taxation limit of Szép-card benefits, changes in regulations of unpaid leave and further details of tax payment relief.

We have collected the most important regulations.

Changes in performing tax liabilities – New deadline: 30. September, 2020.

Taxpayers subject to corporate income tax has the possibility to perform the yearly or extraordinary tax calculation, tax return and tax payment liabilities due between 22. of April, 2020 and 30. of September, 2020, and the corporate income tax advance calculation included in the yearly tax return until 30. of September, 2020.

Taxpayers subject to small business taxation can perform yearly or extraordinary calculation of small business tax, tax return and payment liabilities due between the effective date of the government decree and 30. of September, 2020 until 30. of September, 2020, moreover tax advance calculation and related tax return obligation has been postponed too until this date.

Taxpayers subject to local business tax has the possibility to perform the yearly or extraordinary tax calculation, tax return and tax payment liabilities due between 22. of April, 2020 and 30. of September, 2020, and the tax return about the next year’s advance payments until 30. of September, 2020.

Taxpayers subject to innovation contribution can perform the yearly or extraordinary tax calculation, tax return and tax payment liabilities due between 22. of April, 2020 and 30. of September, 2020, and the innovation contribution advance calculation included in the yearly tax return until 30. of September, 2020.

Corporate income tax advance, small business tax advance and innovation contribution advance payments due between the effective date of the government decree and 30. of September, 2020 shall be paid based on the last available tax return including tax – or contribution advance calculation, in the same amount, order and until the usual deadlines. The taxpayer can claim for a relief for these advances and for local business tax advance before their due date in case the expected amount of the 2020 taxes and contributions will be less than defined in the last available tax returns.

Preparation, publication, deposit and submission obligations related to financial statement due between the effective date of the government order and 30. of September, 2020 are postponed until 30. of September, 2020, also deadlines of additional accounting liabilities based on this financial statement should be calculated from this date.

SZÉP-card benefits

Increased amount can be transferred to Szép-cards as in-kind benefit. The increased limit is maximum yearly 400,000 HUF for accommodation subaccount, 265,000 HUF for hospitality subaccount and maximum yearly 135,000 HUF for leisure subaccount.

An additional relief is that if until June 30, the employer pays this amount to the employee no social contribution liability should be paid on it. This means that the tax burden of the taxpayer decreases from 32.5% to 15%. Additionally, the limit of beneficial taxation increases to 800,000 HUF yearly instead of 450,000 HUF, in case of budgetary institutions the increased limit is 450,000 HUF.

Further measurements help the tourism sector, so after guest nights spent in the period up to 31 December 2020, tourism tax is not payable by the taxable person and the person liable for collection of the tax does not have to collect and pay it. However, the amount of the calculated but not paid tax should be declared to the Tax authority, which is received as a non-refundable subsidy by the municipalities.

Reliable taxpayer

Based on classification made during and after the emergency, the reliable taxpayer status cannot be terminated due to breaching tax liabilities during the emergency or withing 30 days from the end of it by referring to the tax difference due from the taxpayer.

Nor does the classification of a risky taxpayer during an emergency consider, when examining the conditions, the tax difference charged to the taxpayer due to a breach of the tax liability during the emergency or within the next 30 days.

Payment reliefs

In addition to postponement of payment, permission of payment in instalments and automatic installment payment, the tax authority shall, at the request of the taxpayer and the person liable to pay the tax submitted until the 30th day after the end of the emergency permit free of charge the defer of the payment or payment of instalments for up to twelve months for outstanding tax liability up to HUF 5 million, if the applicant proves together with the application that the payment difficulty can be attributed to the emergency. Submission of the request is duty free and the authority decides within 15 days.

At the request submitted until the 30th day after the end of the emergency by the non-natural person taxpayer and the person liable to pay the tax, the tax authority shall reduce the tax debt once, by a maximum of twenty percent, but not more than 5 million HUF, if the payment of the tax debt would make the applicant’s business impossible for a reason attributable to the emergency. Tax release can be claimed for only one tax type. It is important to know that in case we use the possibility of the reduction, then deferral of payment or installment payment can no longer be requested for the remaining amount.

EKAER

Users of Electronic Public Road Trail Control System (Hungarian abbreviation: EKAER) will receive also reliefs according to the recently published decree. During the emergency and until the 30th day after it they are exempted from providing collateral and also, they get back the previous collateral, which is arranged by the Tax authority automatically without delay.

Maintenance of cash registers

In the case of cash registers, the software review and the service inspection do not have to be carried out during the emergency, it is sufficient to comply with this obligation within 120 days after the end of the emergency.

Unpaid leave and health insurance

During the emergency employees on unpaid leave due to this situation are entitled to health insurance. From 1st of May, 2020 the employer must calculate, declare and pay the social security contribution of these employees until the 12th day of the following month. By the request of the employer, the tax authority may permits to pay the declared amount of the contribution until the 60th day after the emergency.

Social security contribution, Special tax of small businesses, Simplified contribution to public revenues

The amount of the social security contribution will be decreased from 17.5% to 15.5% of the tax base from 1st of July, 2020.

Also, from 1st of July, 2020 the Simplified contribution to public revenues (Hungarian abbreviation: EKHO) is decreased from 17.5% to 15.5%.

The percentage of Small business tax will be decreased from 12% to 11% from 1st of January, 2021.

We hope we were able to help track and understand the changes. If you have any further questions, please contact us at [email protected].

We continue to report on any changes that come into effect, it is worth following our blog. Read our related previous articles!

Contact:

Daniela Zsigmond
MD Romania,
Partner

Rafał Nadolny
MD Poland,
Partner

Tamás Kovács
MD Hungary,
Partner

Related content