Our tax team uniquely integrates tax and legal expertise with industry knowledge and an understanding of our clients' business needs. This approach ensures that we are able to deliver sophisticated, high-profile and seamless tax advisory services and provide tax solutions in the increasingly complex area of tax legislation and practice.We have experience in advising on the full spectrum of tax related matters, including:
EU TAX LAWEU TAX LAW
EU tax laws are integral part of the Hungarian tax legislation. One cannot avoid analysing EU tax laws when getting into a dispute with the Hungarian tax authorities, reviewing the operation of a business from a taxation point of view, structuring an M&A deal, planning an internal restructuring project, considering the social security liabilities of seconded employees, or making a transaction where regulated or non-regulated funds are involved. EU laws are necessary to be considered in state aid matters (e.g. development tax allowance) as well.
The decisions of Court of Justice of the European Union are essential to be known and considered especially in VAT cases. B&T’s team is well trained in such matters and gained valuable experience in EU law based litigation, representing clients before the CJ of the EU, argued successfully on the basis of EU tax laws before the Hungarian tax authorities and courts and prepared EU law based analyses for various purposes (e.g. comparison of country regulations, review of certain tax provisions whether they are in compliance with EU tax laws, compliance of newly introduced taxes with primary and secondary EU legislation etc.).
TRANSFER PRICINGTRANSFER PRICING
Transfer pricing became one of the hottest focus areas of the Hungarian tax authorities. In order to avoid transfer pricing related tax base modifications and corresponding penalties, taxpayers have to make sure to have proper transfer pricing reports in place – complying with both the Hungarian documentation provisions and the expectations of the tax authorities.
Currently, the only feasible option to mitigate transfer pricing risk pertaining to on-going or future inter-company transactions is to obtain a so-called advance pricing arrangement (APA). APA is an agreement between the tax authorities and the taxpayer on the transfer pricing treatment of inter-company transactions that is binding on the tax authorities.
Mutual agreement procedures (MAP) are processes through which tax administrations can discuss and eliminate double taxation that arises from transfer pricing adjustments. As transfer pricing is an area important for tax authorities throughout the EU, it is anticipated that the number of MAPs will increase in the future.
PERSONAL INCOME TAXPERSONAL INCOME TAX
Personal expenses and the tax burden of individuals’ income are considered to be amongst the most relevant items of expense for a number of companies. Optimisation of such tax expenses therefore may be an important factor to maintain competitiveness. The careful planning of individual taxation becomes necessary in many cases, such as:
- management and employee remuneration schemes, stock option plans and other employee incentives;
- tax planning of savings income with due consideration to the changes in international taxation (e.g. information exchange) in this field of taxation;
- secondment and transfer of employees to another country within a group of companies;
- private investments, exit from private business, divestments and planning of tax efficient income flows;
- restructuring of companies, groups of companies held by individuals;
- planning tax efficient financial products for potential private individual customers.
B&T experts are ready to assist and guide you closely in your business decisions as well as help you to achieve your compliance goals. Our core values are inventiveness, reliability and confidentiality. We offer tailor-made solutions for our clients after analysing their background and specific business needs and we are keen to support them to achieve their personal success. As an independent consulting firm we are not restrained by conflicts of interest related to audit or legal services which allows us to have a more flexible approach. Due to our international business network we are able to provide you with a truly integrated multi-jurisdictional tax advice.
FINANCIAL PRODUCTSFINANCIAL PRODUCTS
Due to their background and training, B&T consultants have broad experience in the taxation of financial products, inter alia, cross-border asset finance, derivative transactions, development of tax-efficient financial instruments, initial offerings and offering of bonds and other financial products, securitisation transactions, financial outsourcing, hybrid instruments and entities, and tax credit utilisation schemes.
TAX LITIGATIONTAX LITIGATION
Over the last couple of years, Hungarian taxpayers have been experiencing a steadily growing number of tax audits resulting in disputes with the tax authorities. This trend is mainly due to the financial crisis which put huge pressure on Hungarian revenue authorities and significantly changed their approach to tax collection as well as their appetite for challenging the taxpayers’ assessment.
Also, similarly to other jurisdictions, the complexity of tax disputes is increasing, further strengthening the need for the professional management of tax risks and controversial tax matters. Our skilled litigation experts are in the forefront of the most complex tax disputes in Hungary and understand well that tax litigation lawyers must be familiar with both tax laws and procedural processes in order to be able to provide efficient representation to our clients. We provide professional legal advice and representation during all phases of tax audits and court litigation and support our clients in reaching a favourable outcome.
STATE SUBSIDIESSTATE SUBSIDIES
According to many financial director, the collection of available state subsidies is a must to maintain competitiveness and profitability. Accordingly, appropriate attention must be given to exploring and obtaining available direct cash grants and indirect state aids, such as tax incentives.
Due to our experience and knowledge in this field, we are ready to help you in this exercise and guide you through state aid and tax legislation to optimise your state aid scheme, covering matters such as maximum aid intensity, eligible costs, location of investment, investment phases, change in the investment plan, conditions for obtaining the state aid, filing development tax credit applications or notifications, concluding state subsidy agreement with the government etc.
Where a company is subject to a merger, de-merger, acquisition, internal reorganisation the continuity of existing state aid arrangements must be considered with special care.
As a harmonized area within the EU, advising on VAT demands a comprehensive approach from tax professionals which requires familiarity with both EU regulations and local VAT laws. Having a thorough understanding of our clients’ domestic and internationally oriented business activities, we provide customized cross-border solutions to optimize VAT burden.
Our dedicated professionals have considerable experience in VAT during transactional structuring, performance of due diligence reviews, provision of day-to-day VAT advisory services and assistance to clients in VAT compliance exercises.
Our services related to VAT include:
- optimizing of international supply chain management,
- performance of VAT health checks,
- assistance during tax audits with a particular focus on VAT, representation in appeal proceedings before tax authorities and during court proceedings (both national courts and the European Court of Justice),
- advising on VAT optimized transactional structuring,
- VAT advisory services related to real-estate transactions,
- advisory services related to VAT implications of financial services,
- preparation of binding and non-binding ruling requests on VAT aspects of various business schemes and dialogue with the authorities.
BUSINESS TAX ADVISORYBUSINESS TAX ADVISORY
Quick and reliable tax assistance using immense tax experience and a business-minded, flexible approach are very valuable for a business that must face new challenges on a daily basis. B&T tax experts often approach matters from the perspective of the clients’ in-house counsel, as if they were one of them, since they are regularly involved in business processes and business decisions. Rather than simply providing standardised services, we work as part of the business and, therefore, we are better able to contribute to its success.
By analysing the business background and the client’s specific needs, B&T tax professional deliver tailor made-advice and assist in their execution. In addition, we map the available opportunities of a business that can be monetised in terms of taxation to raise the business to a higher level of profitability and competitiveness. Our specialist team has long-standing experience working with big four tax advisors, international law firms and the tax authorities to understand the operation and processes of both multinational and smaller business. We also have a deep knowledge of the practices of the tax authorities which enables us to adjust our approach to the relevant legal environment.
Our strength is reliability, flexible thinking and inventiveness and we can provide integrated multi-jurisdictional solutions due to our established international network.
REAL ESTATEREAL ESTATE
Whether development or investment, real estate is an undoubtedly tax-sensitive business in Hungary. If you wish to purchase, develop, utilise or sell a Hungarian property, our real estate tax experts will support your business by delivering tailor-made tax solutions. Our property related tax services include:
- tax structuring of direct and indirect real estate investments
- tax due diligence, real estate related M&A and corporate restructurings;
- transfer tax planning;
- property related transfer pricing issues;
- financial and operative leasing transactions;
- real estate funds and REITs;
- municipal property taxes;
- VAT planning and VAT treatment of real estate investments and operation
TAX COMPLIANCETAX COMPLIANCE
In light of the continued increase of reporting requirements, our tax professionals deliver high quality advice in relation to technical tax issues.
In our experience, sound compliance practice can achieve multiple goals:
- avoiding errors in tax returns, preventing the application of erroneous tax treatment;
- revealing tax saving possibilities;
- saving time and human resources.
We are committed to assisting our clients in general compliance matters, where key areas of our services include the following:
- assistance to local tax teams in the duly preparation and submission of tax returns and providing support with respect to various reporting obligations;
- conducting internal due diligence exercises in order to identify potential tax risks and erroneous compliance practises.
Our specialized services concerning the main taxes are as follows:
Value added tax (VAT)
- assistance in the process of obtaining a Hungarian VAT number for foreign enterprises
- day-to-day assistance in the preparation and submission of VAT returns
- advising domestic businesses to set up their compliance practises
- operational assistance during tax authority audits
Corporate income tax (CIT)
- review of general ledgers, analysis of the accounting treatment of significant transactions
- review of CIT base adjusting items
- numerical reconciliation of the CIT calculation
Personal income tax (PIT)
- preparation of quarterly tax advance and annual tax calculations and tax returns of foreign individuals during Hungarian assignments
- assisting individuals with high level and complex income in the preparation of their PIT returns
MERGERS & ACQUISITIONSMERGERS & ACQUISITIONS
We are indeed passionate about mergers, acquisitions and corporate restructurings. This is another significant area where we have outstanding skills and experience. We regularly act on high-profile and complex M&A and corporate restructuring transactions, advise on them from a tax law perspective and work together with various legal and financial advisory firms.
We oversee and manage the whole spectrum of tax-related works, such as preparation of data room, tax due diligence, tax efficient structuring, state aid matters, drafting the tax provisions of the share or asset transfer agreements, coordination with the legal and financial teams as well as with foreign advisors. We also manage the whole transaction from a strategic perspective.
In a transaction, taxation has key significance. Taxation determines the plan for the implementation, like an architect determines the structure of a new building. Careful planning is essential to constructing a massive building as well as a bullet proof corporate structure that serves the specific needs of our clients.