CIT calculation and preparation of corporate income tax returns

CIT calculation and preparation of corporate income tax returns - Legal compliance through CIT specialists

In the course of tax advisory, we prepare and check the CIT calculations necessary for preparing corporate income tax returns in accordance with the CIT Act (Act LXXXI of 1996 on Corporate Tax and Dividend Tax). In calculating corporate income tax, we pay special attention to identifying and exploiting opportunities such as meeting the conditions for CIT support.

If you would like to enlist the help of CIT experts to address questions such as

• How are corporate income tax and after-tax profit calculated?
• What items increase and decrease CIT?
• How does the use and creation of development reserves affect the corporate income tax base?
• Who is eligible for support? What are the precise conditions for support?
• What tax benefits are available to your company that you may consider when submitting your annual tax return? What are the conditions for claiming them?

then contact RSM's dedicated tax advisory team. With decades of experience as a member of the RSM Global international network, our CIT specialists are ready to help you with any technical question.

RSM CIT ADVISORY - I'M INTERESTED

Corporate income tax returns in 2024 - How our CIT advisory services can benefit you this year

One of the biggest technical challenges for companies in the course of year-end closing is the preparation of the corporate tax return. The use of development reserves, the taxation of bad debts and extraordinary depreciation are all issues which have a significant impact on the calculation of corporate income tax.

There are several reasons why exploring these and other similar opportunities and obligations should be left to tax advisors.

In particular, we recommend our CIT advisory services to companies that

• wish to pay particular attention to ensuring that their corporate income tax return is filed on the basis of accurate calculations, 
• wish to prepare their corporate income tax return with all of the opportunities for tax planning and tax benefits provided by the CIT Act taken into account, 
• wish to have their corporate income tax returns reviewed or even prepared and filed by a tax expert with the necessary knowledge and experience,
• seek to avoid any findings being made by the tax authority and possible penalties being imposed by the National Tax and Customs Administration.

Key benefits of having CIT returns prepared by experts

• In order to potentially reduce the amount of CIT, we will identify and examine in detail any items decreasing the tax base that the company would be entitled to claim.
• As part of our work, we pay special attention to identifying costs and expenses not incurred in the course of business operations as items increasing the tax base.
• In checking individual CIT calculations, we will draw attention to any available tax benefits.
• If CIT benefits are claimed (e.g. sponsorship of spectator team sports, development tax benefits and tax benefits for investments serving energy efficiency purposes),we will examine the relevant eligibility criteria.
• If you did not pledge your tax advances up to the available amount when the monthly or quarterly corporate income tax advances became due, we will check the amount that you could still pledge.
• If required, we can assist you not only in finalising your CIT calculations, but also in filling out the related tax returns.
• As part of our review, we will check whether the company is required to submit a transfer pricing report and will review or prepare the calculation of the arm's length prices of related parties.
• If necessary, we are also ready to take over the preparation of your CIT calculation in its entirety, which can also include filling out the corporate income tax return and, based on a power of attorney, the submission of the tax return to the National Tax and Customs Administration.
• During the consultation, further tax-related issues may be raised, if required.

CORPORATE INCOME TAX CALCULATION AND ADVISORY - REQUEST AN OFFER

What does RSM Hungary's CIT consultation involve?

• We will review the corporate income tax calculations made available to us. As part of our review of the CIT return, the provided trial balances and the provided subledger records and source documents supporting the various tax base adjustment items are reviewed and verified, mostly by random sampling based on a risk analysis and partly on an item-by-item basis.

In particular, our review involves taking into account and reviewing the use of losses carried forward from previous years in light of previously filed CIT returns and requests.

• If the company is required to prepare a transfer pricing report, we will also review its form or even its content, and will review or prepare the calculation of the arm's length prices of related parties.
• We will prepare a short summary of the results of our review of the corporate income tax return, on the basis of which we will consult our client.
• Any company may face temporary capacity issues from time to time, which is why we are also ready to take over the process of corporate income tax calculation in its entirety, including the preparation of the corporate income tax return, as required. Based on a power of attorney, we can also submit the CIT return on behalf of the company.
• If there are obstacles to collecting and sending the necessary data and information, our experts can retrieve the data required for the preparation of the CIT return through online access, even directly from the company's ERP system, provided that our client's system allows this.

As part of our IFRS accounting and tax advisory services, we

• develop reporting systems and processes that are in line with the International Financial Reporting Standards (IFRS),
• provide assistance during conversion and transition, and also in preparing financial statements and tax returns, and
• assist in the interpretation of accounting and tax standards and in developing good practices.

If you would like to learn more about the key rules for IFRS transition, read our blog post on the topic.