Read more about Reverse Charge and “Call-off stock” in Hungary in our comprehensive guide.
There is a registration requirement for sales of call-off stock that entail the transit of items into Hungary just as there is for consignment stock. Since January 1, 2020, EU-registered call-off stock providers may avoid registration in Hungary by using the EU “Quick Fix” simplification program. Before that date, a different simplification approach was in place.
Call-off stock arrangements are standardized throughout the EU on or after January 1, 2020, under one of the “Quick Fixes” provided by Article 17a of the EU VAT Directive, which is incorporated into Hungarian legislation by Articles 12/A and 22 of the Hungarian VAT Act.
Certain restrictions apply if a supplier moves goods to a warehouse in another EU Member State to make a later delivery to a known purchaser. The transfer to the warehouse is not a taxable event under the simplification rule. Instead, the following transfer of ownership of the items to the receiver is a taxable event. The taxable transfer is recognized as an intra-Community supply of goods from the supplier to the recipient (which is exempt with the right of deduction) and an intra-Community purchase by the recipient in the Member State of acquisition. This approach removes the supplier’s need to register for VAT in the Member State of destination.
Import of goods means the entry of goods into the Community from a third country. Liability for Hungarian VAT is based on where supplies of goods or services are made, not on where a supplier may be located. VAT is payable on all purchases of goods bought from outside Hungary, at the point of importation, at the same rate that would apply to the goods or services if supplied in Hungary. When services are purchased from a supplier established outside Hungary, place of supply rules or a “reverse charge” mechanism reach an equivalent result.
For VAT purposes, goods are treated as imported when:
Technically, the arrival of products in Hungary from another EU Member State is referred to as an “intra-Community acquisition” rather than an import. At the same time, the cross-border supply of services is excluded from the import system.
When products from outside the EU are imported into Hungary, the importer is normally required to pay VAT on the commodities (as well as customs and excise duties, if applicable). In this context, the term “importer” refers to a business that makes sales in Hungary and is, therefore, most likely required to register as a VAT payer.
However, suppose the importer is not registered for VAT. In that case, the Hungarian receiver of the products is required to pay import VAT in addition to customs excise taxes upon receipt of the items.
On or after July 1, 2021, international suppliers from third countries may opt to use the Import One Stop Shop (IOSS) to simplify VAT payment on low-value items imported into Hungary.
Last Updated: 21/06/2022
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