This website has been created to provide high level assistance to our Clients with respect to transfer pricing. Our aim is to provide information on the Hungarian transfer pricing rules and to help our Clients to duly comply with the requirements set therein.
Recently, transfer pricing became an area of focus for the Hungarian Tax Authority and they more often conduct comprehensive tax audits with respect to arm’s length pricing. Also, the tax auditors are well-trained and have extensive knowledge in international best practices for the determination of fair market prices.
The matter of transfer pricing relates to taxation. The scope of applying an arm’s length price in the related party transactions is to be able to determine the tax base of a company properly, in a way so that is acceptable also for the tax authority and to eliminate a tax risk for the company. The tax risk may include penalties, late payment interests, or higher corporate income tax liabilities.
Transfer pricing compliance is another issue at stake, meaning, if a company fails to meet transfer pricing documentation requirements a penalty up to approx. EUR 53,000 (HUF 16 million) per missing documentation, per year may be levied.
One of the most effective tool to mitigate the transfer pricing risk is the conclusion of an Advanced Pricing Agreement (“APA”) with the Hungarian Tax Authority regarding the pricing of a specific transactions. The APA is binding and valid for 3-5 years and it can be extended once for an additional period of 3 years. It has several advantages: reduces costs associated with both audit defense and documentation preparation, tax liability can be planned, and an APA can be concluded within a relatively short time frame.
Our services include transfer pricing compliance and transfer pricing advisory services, as follows:
ü Preparation of transfer pricing documentation in line with the Hungarian requirements (full-scope, simplified or consolidated);
ü Preparation of European transfer pricing documentation (master file as well as a country- specific file);
ü Review of transfer pricing documentation prepared centrally on a group level to determine whether it complies with the Hungarian transfer pricing requirements – amend and supplement if necessary;
ü Review of existing transfer pricing documentation of the company from a Hungarian transfer pricing perspective – amend and supplement if necessary;
ü Preparation of an economic analysis with respect to intercompany transaction: selection of the proper transfer pricing method, conducting a comparable analysis, and determination of the arm’s length price;
ü Transfer pricing advisory services;
ü Transfer pricing planning.
Advanced Pricing Agreement (APA)
ü Assistance in the process of conclusion of an APA
ü Preparation of transfer pricing documentation to be filed with the APA request
ü Compilation of the APA application package
ü Consultation with the representatives of the Hungarian Tax Authority
Grants & incentives
ü Preparation of procurement tender documents, compilation of public bidding packages
ü Preparation of the application for state funding
ü Project planning
ü Regional development plans
ü Preparation of business plans, feasibility studies, of sectoral analyzes
ü Preparation of the application for the development of infrastructure; purchase of machine, device, hardware, software, real estate
ü Preparation of application for training funds
ü Tax incentives (development, sport)
Business consultancy, Audit and Tax services
Our company consists of auditors and tax experts, having more than 20 years of professional experience as executives and directors of Hungarian and multinational corporations (MOL, pharmaceutical companies, etc.) and Big4 advisory firms.
Our professional skills, knowledge and vocational practice enable us to provide high level solutions for the transfer pricing problems of your company.
Partner/General Manager: Gergely Beres-Molnar
Office: 1114 Budapest, Hamzsabegi ut 38-40. A. VII. 1.
Approach: The office is located in the 11th district near Kosztolanyi Dezso ter.
Telephone / fax: +36-1-878-1541
Gergely Béres Molnár cell: +36-30-600-9396