Wednesday, 1 June 2016

Hungary: Transfer pricing measures in tax legislative proposals

Hungary’s government published tax proposals that, if enacted, would make changes to Hungarian tax law—including changes to the transfer pricing rules.

Among the proposals in the legislation are measures relating to receivables from affiliated companies. Concerning this proposal, the “tax base decreasing items” related to receivables could be used only if the transaction were supported by “genuine business reasons.” Specifically under the transfer pricing proposals, the tax base decreasing items could only be applied if the other party to the transaction included the difference in its tax base calculation. 

For “free of charge” transfers of assets, the expenses incurred by the transferor could only be deductible if the recipient certified that the tax on the recognized revenue has been paid.

Source & more info: KPMG