CbC reporting (CBCR) requirements in Hungary


CbC reporting (CBCR) requirements in Hungary

Japanese newsletter - 21 August 2017

For the Japanese version please click here.

Hungary has adopted OECD BEPS Action 13 under which multinational groups would be required to prepare country-by-country reports (“CBCR”) if the group's consolidated revenue exceeds EUR 750 million. As a general rule, the CBCR must be prepared by the ultimate parent company of the group and must be filed with the tax authority of the state of which it is a tax resident, however, in certain cases the Hungarian group member may also be obliged to the reporting.

The Hungarian members of the group – in all cases – need to submit a notification form to the Hungarian Tax Authority. Failure to comply with the reporting and/or notification obligation may result in a default penalty of up to HUF 20 million (approx. EUR 64,500).

Reporting obligation

As part of the reporting several financial data are to be provided in an aggregated form for each country where the multinational group has legal entity. The CBCR submitted by the multinational groups are shared with the tax authorities of other countries joined the exchange of information agreement. On the basis of the CBCR tax audits can be initiated.

A Hungarian tax resident entity of a multinational enterprise may file a CBCR in Hungary if it is the ultimate parent entity of the group, or it is appointed to file the CBCR within the group by the ultimate parent. Furthermore, the Hungarian entity is also obliged to file the CBCR if no CBCR obligation at the country of the ultimate parent; or for any reason there is no exchange of information between Hungary and the residence jurisdictions of the ultimate parent. Please note that currently Hungary has an exchange of information with the members of the European Union and Gibraltar, therefore companies with e.g. US or Japanese headquarter may need to investigate the potential CBCR obligation of the Hungarian subsidiary.

The CBCR should be submitted within 12 months following the end of the respective financial year (e.g. financial year ended on 31 March 2017 the deadline is 31 March, 2018).

Notification requirement

Hungarian group entities has to notify the Hungarian Tax Authority of the name and tax jurisdiction of the entity having the obligation to submit the CBCR.

As a main rule, the notification deadline is the last day of the given financial year. In the case of the first financial year, started on or after 1 January 2016 there is a deadline extended by 12 months considering the new law.

Should you have any questions regarding the above, please contact our experts.

Japanese transcript

OECDの税源浸食と利益移転(Base Erosion and Profit Shifting: BEPS)行動計画13がハンガリーで採択され、グループ会社の連結売上高が7億5千万ユーロを超える場合、多国籍企業は国別報告書(「Country-by-Country:CbC」)作成を義務づけられることとなりました。CbC報告書は原則としてグループ会社の親会社によって作成され、その親会社管轄区の税務当局への提出が要請されるものですが、ハンガリー国内のグループ会社からの提出が必須となる場合もあります。さらに、グループのメンバーのハンガリー国内企業はすべて、ハンガリー税務当局に通告書を提出する必要があります。報告義務および、または通告義務を遵守しなかった場合、規定の罰金は2千万ハンガリー・フォリント(約6.45万ユーロ)に及ぶ可能性があります。









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