VAT/EPF/EKAER treatment of purchases and supplies

If you operate a complex business model in Hungary (such as toll manufacturing, supplies subject to installation or assembly, chain transactions, subcontractors, multiple scenario business, etc.) you may wish to understand better VAT/EKAER/EPF treatment of each of your purchases or supplies and potentially seek advice on reorganization/supply chain optimalisation.

For example, if you purchase goods from various locations in Hungary/ other EU countries/ non EU countries to Hungary, refurbish them locally while relying on one or more local or regional subcontractors, then supply the refurbished goods either locally or across border from Hungary or elsewhere, you may face multiple VAT organizational questions such as:

• Do my local or regional subcontractors need to charge VAT to me?
• Can I recover VAT charged to me by my subcontractors?
• How PE/FE status can impact the VAT treatment of my purchases/supplies?
• Should I charge VAT on my supplies?
• Do I have to register in other jurisdictions too?
• How logistical arrangements of my operations (such as “ship from” and “ship to” locations impact the VAT/EKAER treatment of my supplies and purchases?
• How INCOTERMS and other business terms can impact VAT/EKAER treatment of my supplies and purchases?
• What supporting documents do I need keep to satisfy VAT zero-rating conditions?
• How can I simplify my processes and increase my level of VAT compliance?

RSM Hungary can help you to determine VAT/EPF/EKAER treatment of each of your transactions (detailed tax footprint mapping),identify risks and provide recommendations for improvement and potentially simplification of your VAT operations in Hungary and in the region.