From 1st July 2020 all tax-identities in Hungary are required to report invoices, and the limit from which invoices had to be reported to the Hungarian tax office, NAV, (namely above 100.000HUF VAT content) was eliminated. Due to the pandemic situation NAV is providing a transition period, between 1st July 2020 and 30th September 2020, during which there will be no penalties and sanctions from non-compliance. The data provision of invoices will be complete from 1st January 2021, from which date all invoices issued to anyone should be reported.
How should we issue invoices from 1st July 2020?
The change of legislation affects mainly small enterprises, businesses without VAT registration and businesses registered to „KATA” taxation. In their case the old ways of invoicing have to be changed. An important question is what shall we change to?
This summary shows how the rules of issuing invoices and receipts change from 1st July 2020. What invoicing solutions and programs/software can be applied? What happens if someone stays with hand-issued invoicing? How to connect the invoicing program to the NAV data provision system? We will also introduce a couple of the most popular invoicing programs, with its advantages and disadvantages.
We would also like to draw your attention to the fact that this summary contains the main points and might not cover all businesses. If you are unsure about what applies to your specific business, please contact your accountant! We are also here to advise you if you have any questions!
Requirements of using invoicing booklet and invoicing programs/software
The legal requirements of using invoicing booklets and invoicing programs is determined by act 23/2014 (VI.30) issued by the Ministry of Economy. This is what we call the „invoicing act”.
The last changes were issued on 1st July 2018, and it becomes officially effective from 1st July 2020. Currently there are no other regulations. which are waiting to become effective, and also changes might happen in the future.
Requirements of using paper-based invoicing (invoicing booklets)
- The invoicing booklet has to be produced by printing, between a determined number range, with using numbers in continuous sequence. Invoicing booklets available in stationary shops fulfill comply with this rule.
- You should have an invoice for the purchase of the invoicing booklet with the following information: tax number of the purchaser of the invoicing booklet, type of document (in this case invoicing booklet), and the numbering range of the invoices, showing the first and last numbers in the booklet.
- Invoices are considered to be documents of strict accounting. It means that you have to include it in your registry of strict accounting documents. This registry includes:
- a) number range of the invoicing booklet, stating the first and last number of the invoices,
b) the invoice number of the invoice you received when you purchased the invoicing booklet,
c) date of purchase of invoicing booklet,
d) the period during which you used the invoicing booklet (first and last date invoicing date),
e) scrapping date of the invoicing booklet.
It is allowed to use invoicing booklets after 1st July 2020, but you have to comply with the above rules. From 1st July 2020 those who will continue using hand-written invoices (and issued invoices with less than 100.000HUF VAT content) will have 1 more obligation to fulfill. You have to report manually the issued the invoice in the NAV online system within 4 days after issuing the invoice. If your issued invoice has VAT content above 500.000HUF, you have to report the invoice 1 day after issuing.
Requirements of using invoicing programs
The invoicing act regulates what is accepted as invoicing program: any computer software, program modules, function and online invoicing systems which is able to issue invoices (2.§/2/).
- numbering sequence
The program has to be able to issue invoices in a continuous number sequence without omission or repetition of numbers. For more details please refer to the Act (8. § /2/-/4/ section.)
- NAV reporting
You have to report to the tax office the use of any type of invoicing program within 30 days of the 1st date of usage. It can be submitted and reported through „NAV ÁNYK” system using document called SZAMLAZO. If you change your invoicing method/program, it also has to be reported within 30 days of the change, by using the same document. If you use NAV1s own invoicing system, it also has to be reported – in this case you use NAV’s central tax number.
- „Tax authority data provision control” function
The invoicing program used should have a built-in „Tax authority data provision control” function.
- Ability to provide invoice data online
Invoicing program should be able to provide invoice data online to NAV. All related regulations are detailed in the Invoicing Act 13/A-B.§ paragraphs. This regulation is valid from 1st July 2018.
- User documentation
The users of the invoicing programs should have the user manual, and seller must hand over the manual and the name and ID number of the program to the use. This documentation also must contain a detailed description of how the program works. The program should be able to carry out the functions detailed in the maul. Should any changes be made to the program, seller must update and modify the manual.
If a business changes its invoicing program, the manual of the old program should be kept.
All the above rules apply to self-developed program as well. If documentation is available in Hungarian, English, German, French or English, it is acceptable. Any other languages should be translated to Hungarian and seller must take care of Hungarian version.
Invoicing and receipts from 1st July 2020
Tax number on the invoice
It is compulsory to include the tax number of the buyer on the invoice, regardless of whether the seller is VAT registered or not. (ref: VAT law 169. dc).
Deadlines for issuing invoices
From 1st July 2020 invoices should be issued after 8 days of fulfillment the latest. If payment is made by bank card or cash, invoices should be issued immediately – this rules is unchanged. Details can be found in the VAT law 163.§.
Online data provision from the invoice
Invoice data must be provided from all invoices issued to all tax entities, so the previous 100.000HUF VAT content limit was eliminated. Details can be found in VAT law, appendix X. Data provision must take place through the electronic platform, provided by NAV, https://onlineszamla.nav.gov.hu
All the above rules apply to KATA businesses, and other businesses as well which are not VAT registered (except for sales within EU, according to VAT law 89.§).
- These could be typical invoicing practices from 1st July 2020:
when using an invoicing booklet for cash payments invoices should be issued immediately and should be manually reported to NAV within 4 days (if VAT content is above 500.000HUF, invoices should be reported 1 days after issue, the latest).
- when using an invoicing booklet for bank transfer payments invoices should be issued 8 days after fulfillment the latest and reported to NAV within 4 days after issue date (if VAT content is above 500.000HUF, invoices should be reported 1 days after issue, the latest).
- the above rules apply to invoices issued by invoicing programs as well – here reporting is automatic as the program reports invoices.
There could be a maximum penalty of 1.000.000HUF if an invoice or receipt is not issued after the purchase or service fulfillment. (Art. 228.§)
If online data provision is not made, late or is made inappropriately, or data provided is false, the penalty is maximised in 500.000HUF/invoice for business entities, and 200.000HUF/invoice for private individuals. (Art. 229.§ 220.§)
Providing receipts from 1st July 2020
All rules for providing receipts is unchanged, previous regulations apply. Receipt should be issued to a buyer if payment is made by cash, invoice is not given and the value of the purchase/service is below 900.000HUF. (VAT law 166.§).
If a buyer is a private person and an invoice is issued, those invoices should be reported from 1st January 2021.
Registration in the NAV Online System
All businesses have to be connected and registered to NAV Online System, which can be done here: http://onlineszamla.nav.gov.hu/
The next steps should be taken for businesses, sloe traders, who have not done the NAV Online registration yet. Registration is necessary, because:
- this enables the invoicing programs to provide invoice data automatically to the NAV Online system.
- those who decide to use NAV’s own invoicing system, the NAV ONLINE Invoicing System, can report their invoices after registration to NAV Online System.
- if invoice reporting is done manually, it can only be done if there is an existing NAV Only System registration.
How to register to NAV Online?
The official announcement and instructions can be found on the website of Online Invoice:
It is important that the official representative of the business should have registered „Ügyfélkapu” (Personal Government Gateway) account.
The official representative of the business is the „primary user” in the system, who has full permission and rights. He/she can add further users and can allocate rights to others as well. If there is a change in the person of the official representative of the business, it also has to be reported here and altered in the system.
A „technical user” is the invoicing program itself – it identifies the invoicing program. It can be altered any time.
During the registration and any time later a „secondary user” can be added. It can a person who carries out the manual invoice reporting (for example an assistant, office manager, etc).
An accountant can represent many businesses. It is important that if the accountant is already a „primary user” for another business, he/can use her own user name and password to become a „secondary user” of another business. In this case the accountant can see all businesses under the same user profile.
Registration can be started from here: https://onlineszamla.nav.gov.hu/
If you need assistance for the registration, do not hesitate to contact your accountant, and we e are also here to support you – please ask for a consultation!
After successful registration the „LOGIN” window will pop up automatically.
Creating a „Technical User”
A „Technical user” has to be created after registration if you want to connect any invoicing program to NAV Online. These data are necessary for data provision.
You must be logged into NAV Online, to create a „Technical User”. These are the steps/points:
- Users (Felhasználók)
- New User (Új felhasználó)
- Adding a „Technical user” (Technikai felhasználó hozzáadása)
- Provide password (Jelszó megadása)
- Set up of authorities (Jogosultságok beállítása)
- Save (Mentés)
- Generating a key (Kulcsgenerálás)
You will need the name of the „Technical user”, password, XML signature key, and XML replacement key to identify the taxpayer.
Creating „Secondary user”
It is not compulsory. The starting steps are the same as the steps to create a „Technical user” – in Adding a User you have to choose the point „Secondary User”.
Providing data manually to NAV Online System
After registering and login to onlineszamla.nav.gov.hu, please choose menu Invoice data reporting (Számlaadat-rögzítés / Egyszerűsített rögzítés) and manually record data requested. .
Online invoicing systems
There are 2 types of invoicing programs – online and software.
The benefit of the online systems is that the service provider makes all necessary updates and legal change requirements, and you don’t have to purchase an update.
Some of the most popular online invoicing programs:
Számlázz.hu – www.szamlazz.hu
Novitax – www.novitax.hu
Számlanyilvántartó – www.szamlanyilvantarto.hu
BizXpert – www.bizxpert.hu
BillCity – www.billcity.hu
EVOLUT számlázó rendszer – www.contorg.hu
Using the NAV ONLINE INVOICING PROGRAM (https://szamlazo.nav.gov.hu/)
NAV ONLINE Invoicing Program is a free invoicing service developed and provided by the Hungarian Tax Authority. It does not mean any advantages or disadvantages, should one use the NAV Online Invoicing Program.
Both paper-based and e-invoices can be used. Partners can be saved, and they will pop-up automatically at the next invoicing. Products can be setup as well, and it can be chosen at the next invoicing.
You can use pre-set frameworks as well if you have monthly/regularly repeating invoices.
You can open more than 1 „invoicing booklet” as well if you want to differentiate, for example, between various business locations, payment methods, etc.
It is also possible to modify and cancel invoices, including those invoices which are not issued by the NAV online invoicing.
Neither the website, nor the User Manual have any information about how long the invoices are kept. It is your responsibility to keep invoices during the official 8 year period.
Choosing NAV Online Invoicing System has to be reported to NAV, through ÁNYK, using form „SZAMLAZO”.
About NAV Online Invoicing System
- It is free, and there is no limitation for invoice value and the amount if invoices.
- you can be sure that it is always up-to-date, and follows the latest legal requirements as well. It is also free, and included in the service.
- data protection is also important – we know it is subjective but the IT system of NAV provides a high-level security for your data and invoice information storage.
- The NAV Online Invoicing System includes all necessary data requirement (for example in the case of a KATA taxpayer it will invoice the for KATA taxpayer).
Overall the use of the NAV Online Invoicing System is easy, and it does not need a high-level of IT knowledge.
Source: nav.gov.hu, Önadózó