The deadline of 30 September is approaching, the deadline by which a taxpayer established in Hungary can reclaim the tax of an invoice issued to the taxpayer in 2022 with a tax rate in force in another EU Member State. The Hungarian taxpayer can reclaim the tax by submitting Form ELEKÁFA to the Hungarian Tax and Customs Office.

Taxpayers (Hungarian) established in Hungary may use this form to request a refund of the tax charged to them in another Member State of the European Community on their purchases and services used in the given tax year. The form should be submitted electronically until 30 September of the calendar year following the refund period. Accordingly, the deadline for submitting the annual application for the year 2022 is 30 September 2023. Applicants who carry out only activities with VAT-exemption for sales of certain products and services, or who have opted for VAT exempt status (by subjective right), or taxpayers carrying out only agricultural activities are not entitled to submit an application/request of tax refund, i.e. to submit an ELEKÁFA form.

A foreign VAT refund request is most likely to arise when a taxpayer is involved in a transaction for the purchase of goods or services where the place of fulfilment is another Member State, and the supplier of goods or services issues an invoice to the Hungarian purchaser charging the VAT rate of that other Member State. These cases typically occur when, for example, a taxpayer attends a conference or training course abroad, hires a car or books accommodation and the foreign supplier invoices these services to the taxpayer at the rate applicable in that Member State. But the same procedure applies if, for example, a transport company needs to use commercial vehicle repair services abroad.

Further requirements of submitting a foreign tax refund request are the following:

  • the Hungarian taxpayer is not established in the EU member state concerned,
  • it uses the goods or services purchased in another EU country for taxable activities
  • finally, if the invoice for these purchases had been issued by a domestic taxpayer charging the Hungarian tax rate, the taxpayer would have right to a tax deduction.

The reclaim is made by submitting the ELEKÁFA form, which can be submitted to the National Tax and Customs Office for each country via the Client Portal. This means that Hungarian taxpayers do not need to contact the foreign tax authorities to reclaim VAT on their foreign purchases, as the Hungarian Tax Office will contact the foreign tax authorities on the basis of the request. The application must be accompanied by the invoices and their annexes (e.g. orders, proof of delivery, transport documents, customs documents) proving the performance of the economic activity.

Upon receipt of the application, the tax authority sends a certificate to the taxpayer without delay, and forwards the relevant parts of the application to the Member State of refund within 15 days. The deadline for assessment is 4 months, which may be extended, but the maximum time limit is 8 months. The taxpayer may be required to submit a request for a correction, which must be completed within 1 month, and the time limit for refund of the VAT amount approved is 10 working days after the decision.

Our newsletter includes general information, please contact our colleagues for personalized advice or interpretation of the law.

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