On 1 January 2018 a new governmental decree (‘Decree’) came into force (465/2017. (XII.28.) on the details of the tax administration procedures. The provisions of the Decree have to be used in new as well as in repeated procedures.
The Decree contains exact procedural rules referred by the new Act on the Rules of Taxation (‘Art.’) and it was expected to clarify some open questions.
Although some questions still remained, the provisions of the Decree should be taken into account in the case of tax authority procedures. Apart from the exact rules of tax administration procedures, in several respects commonly used regulations were also transferred to the Decree from the old Art. The Decree should be used together with the regulations of the new Art. and of the new Tax Administration Act (‘Air.’) and – in some cases – with the relevant tax laws and other governmental decrees as well.
Hereby we summarize some important regulations.
The Decree provides the way of submitting permanent authorizations. These authorizations should be converted to authentic electronic documents and must be submitted to the Tax Authority (‘Tax Authority’ or ‘NAV’) with the authentic electronic signature of the taxpayer (or other document authentication service which substitutes the electronic signature) via an electronic document made available by the NAV. As a result, the option of the paper-based submission may be ceased in the near future.
According to the Decree the Tax Authority continuously publishes on its website the data format in which the taxpayer should provide its data (stored electronically) during a tax audit. Taking into account that the electronic data transfer has increasing significance and that there has been a lot of problems relating to it (for example there were some cases when during a Tax Authority audit the taxpayers had to provide data in a format that some taxpayers were not able to fulfil). Hopefully the integrated data format will terminate these kind of problems.
The Art. containts the main rules of binding ruling requests, but the relating 39/2006. Ministry of Finance (‘PM’) Decree (used so-far) was expired on 1 January 2018. These rules (with some changes) are now included in the new Decree. In connection with this, we have to mention that the details of the data providing obligation (which is in force from 2017) are also regulated in the Decree: in this regard, the binding rulings are sent automatically to the foreign tax authorities if the reviewed transactions may also affect foreign taxpayers.
In addition, the Decree contains the rights and obligations of the Tax Authority in audit procedures (the rights and obligations of the taxpayers are contained in Art.), and, among others, the detailed rules of related inquiry (‘kapcsolódó vizsgálat’ in Hungarian) and of the involvement of foreign tax authorities.
Furthermore, the Decree contains many other regulations as well, for example tax capacity, database on companies without public debt, tax payment guarantee, EFER (electronic payment system), estimation of tax base etc.