E-Invoicing Becomes Mandatory in Hungary!

Since the adoption of the ViDA (VAT in the Digital Age) package, there has been continuous interest in the expected future changes and new requirements. The Ministry for National Economy, together with the National Tax and Customs Administration, has recently published an information material on the Hungarian implementation of ViDA, which can serve as a useful guideline for all taxpayers. It details the main changes to prepare for in the areas of invoicing and data reporting.

One of the most significant innovations regarding electronic invoicing is that the legislator plans to make electronic invoicing mandatory not only for cross-border transactions but also for domestic transactions. Paper invoices will only be allowed in a narrow scope, e.g., for transactions with private individuals or export sales, and even then, the parties must agree on this. The e-invoicing system is expected to open for testing in 2028, allowing obligated parties to use it voluntarily and try it out before the live system goes into operation.

It is also important that, unlike the current practice and regulations, under the ViDA implementation, invoices issued for individual transactions must be prepared in a standardized, machine-readable XML format for both B2C and B2B transactions to enable automation of administrative processes. Naturally, invoice images can still be displayed, but they must be generated from the XML file, as this format alone is considered authentic during a potential tax authority audit.

For archiving these XML-format invoices, the tax authority will operate a system for taxpayers—on both the seller and buyer sides—that ensures the preservation of issued documents and related data reporting for the legally required period. The system will also be able to accept attachments up to 5MB in size, with a limited retention period.

Given the expected changes and the new invoicing format requirements, it is crucial that invoicing software can meet the established requirements described above. Therefore, in the future, all invoicing software will need to obtain official approval (accreditation) to continue operating. The accreditation process will examine whether the software can generate proper invoices and data reporting from XML files and whether it can detect incorrect data.

It is essential for companies to start preparing their current systems for the expected changes in time. Deloitte experts pay special attention to mapping the ViDA package, developments related to its implementation, and clarifying any potential issues.

Our expert colleagues are happy to assist you with any questions!