New trade registration system in effect in Hungary
According to the laws on tax- and electronic public road trade control system, products from 1st January 2015 may only be distributed after the product is reported to Hungarian Tax Authority before transportation.
According to the EKAER system, reporting obligation related to goods transported by motor vehicles on public road shall be fulfilled via the electronic system operated by the Hungarian tax authority (NAV). The goal of the system is the prevention of VAT fraud.
The system oversees the fulfilment of tax obligation related to goods transported on public road from another EU Member State to the territory of Hungary, or from the territory of Hungary to another EU Member State, or within the territory of Hungary.
The laws shall be applied to road transportation of goods,if the transportation is performed by vehicles subject to road toll payment (vehicles exceeding 3.5 tons of maximum permissible gross weight).
1. The report shall be done via EKAER system to the tax authority:
acquisitions of goods from another EU Member State to the territory of Hungary or acquisitions for other purposes – in such case the report shall be done by the recipient in Hungary – until the commencement of transportation of goods
supplies of goods from the territory of Hungary to another EU Member State or supplies for other purposes – in such case the report shall be done by the consignor in Hungary – until the commencement of loading of the goods to the vehicle
first supplies of goods subject to taxation in domestic trade, to other than end users – in such case the report shall be done by the consignor – until the commencement of loading of the goods to the vehicle
The above mentioned activities may only be pursued by taxpayers having a valid EKAER number from 1st January 2015.
Thus the report shall be done either by the consignor or – in case of international transport – by the recipient towards the Hungarian tax authority.
In case the own product will be transported exclusively within Hungary, then there is no report obligation in principle: as a general rule the obligation of reporting is applicable in case acquisition of goods or import for other purposes from other member states of the EU to the territory of Hungary, the sale of goods or export for other purposes from the territory of Hungary to other member states of the EU as well as taxable first domestic sale to non end-users.
The loading shall not be commenced until the report has been submitted. Nevertheless, according to our experience, the critical aspect of the procedure that at border-control, administration should be impeccable.
The EKAER number shall be made available for the carrier or the organizer by the person required to submit the report.
2. Procedure of reporting
- First, a user name and password is required at the Hungarian online administrative interface called the Client portal. Having obtained the registration one may proceed with the administration.
Either the tax payer or its representative may be entitled to require EKAER number on the EKAER’s system electronic interface. Our Law Office is eligible and able to act on the basis of a power-of-attorney.
The report may be submitted online following that the Hungarian tax authority will issue the EKAER number.
The EKAER number shall be applied for each transport. The EKAER number will be valid for 15 days and may identify only a single unit of product. The procedure of application is free of costs.
The submission of the transportation vehicle’s registration number also required in order to issue an EKAER number, therefore it is advisable to know which vehicle will transport the particular product. An EKAER number may be requested without the vehicle’s registration number but it must be provided not later than initiation of transportation. Additionally, the following data shall be reported including inter alia: the recipient’s details (name, tax identification number); exact location of the unloading; in case of transporting hazardous product the data of the owner location of unloading (name, tax identification number); If the property owner is not recipient: the product tariff heading, name, mass; the reason for the transport (product sales, acquisitions or subcontracting); the date of loading.
3. Products posing risk
In particular cases product which will not be transported by vehicles subject to road toll (not exceeding 3,5 tons) may also be reported for transportation.
The so-called risky category of food includes for example oil and sugar. The complete list of products are included in the relevant regulation.
In cases of acquiring goods which are posing risks inside the EU and following the first domestic taxable sale of goods, the tax payer must provide insurance. The value of insurance is a minimum of 15% based on the previous 60 days of EKAER transaction fees. Without handing over proper insurance the tax payer may not receive an EKAER number. The insurance may be provided in a form of deposit or bank guarantee. Those inside the database of certified taxpayers and included in the database of taxpayers operating since at least 2 years without any arrears of tax may be exempted from providing insurance.
Inspectors of the Hungarian tax authority may inspect the transport of products reaching commercial quantities.
The person carrying out the transport might be called on for a statement to present the document certifying the origin of the transported product (bill of lading, invoice).
Within the scope of inspection, the transporter may have to make a statement regarding the identity of the owner. According to this statement, the Hungarian tax authority may seek out the owner the named person in order to obtain data about the transportation. In case the Hungarian tax authority identifies any risk factor – such as the statement provided by the transporter and the owner is controversial –, the authority may use official seal (package or storage lock) until the situation will be clarified.
The Hungarian tax authority may impose a default payment up to 40% of the value of the undeclared product. The transported product might be seized to extent of the fine imposed.
Feel free to contact us, in case your company
obtains or for other purposes imports products from the territory of the EU to Hungary, or
sells or for other purposes exports products from Hungary to the territory of EU, or
performs first taxable domestic sale with transport vehicles subject to road toll payment,
and you have any questions regarding the applicable regulations, the operation, use as well as the registration of EKAER system and report, or in case you require reliable assistance during the procedure of registration and report, our Law Office will gladly be at your disposal .
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