International Tax Newsletter - Spring/Summer 2012 - Hungary
The expected tax changes for 2012 listed in the last International Tax Newsletter have now been modified. Summarized below are the main features of the final 2012 tax legislation:
CORPORATE INCOME TAX
The tax rate remains 10% up to 500m HUF tax base and 19% above.
Deferred losses can only be offset against the profits up to 50% of the tax base from 2012.
Deferred losses in the case of company transformations and acquisitions are now subject to certain limitations.
Profit from the sale of a “registered intangible,” held for at least one year, on which royalty can be charged will be exempted from corporate income.
If a company sells or otherwise disposes of an intangible that is not registered (on which royalty can be charged), the tax base can be decreased by the profit if a pledged reserve is created and this reserve is spent on another intangible within three years.
PERSONAL INCOME TAX (PIT)
The PIT rate is decreased to 16% on the tax base below 202,000 HUF monthly. However, the tax credit that ensured the exemption of the minimum wage is no longer available.
The range of fringe benefits has changed significantly and the benefits are now subject to 11.9% healthcare contribution. The rate of personal income tax of such benefits remains 19.04%.
Representation and business gifts are taxed at 51.17%. There is no limit on the value of business gifts.
- The rate of value added tax has been increased from 27%.
- The VAT on car rental fees is now deductible if the car is used for activities subject to VAT.
- The sale of real property between related companies is now exempt from transfer duty.
- A new “car accident tax” which is 30% of the mandatory insurance premium for the car has been introduced.
- The rates of excise duty and game tax have been significantly increased.
- Any company may choose a fiscal year different from the calendar year if it is reasonable due to the business cycles or the information needs of the parent company.
More information on these developments can be provided by Vadkerti Krisztián, PKF Hungary, through the EisnerAmper contacts listed at the end of this Newsletter.
International Tax Newsletter - Spring/Summer 2012 Issue