PDF invoices get the green light

Tax & Legal Alert | PwC Hungary | May 4, 2020

The National Tax and Customs Authority has recently published a binding opinion on electronic invoices and their retention in accordance with applicable regulations (i.e. electronic archiving) on its official website.

Relevant legislation supports the position that no adverse legal consequences may be established for taxpayers who act as set out in the official bulletins published on the Tax Authority’s official website after 1 January 2018.

In the light of the current COVID-19 pandemic, more and more companies are considering switching to electronic invoicing. Accordingly, the Tax Authority’s publication of its opinion on issuing and retaining electronic invoices was highly topical. The related bulletin is available at the following link:

https://nav.gov.hu/nav/ado/afa/Az_elektronikus_szaml20200416.html

The Tax Authority’s bulletin provides detailed guidance for companies on the basic rules for issuing and retaining electronic invoices, and answers open questions on which no common understanding has been established so far.

In addition to officially recognising invoices issued and transmitted electronically, in PDF format, as electronic invoices, the Tax Authority also provides guidance on disputed matters such as remote printing. The Tax Authority confirmed the view, also held by PwC's experts, that a PDF invoice sent by e-mail must be regarded as an electronic invoice, while an invoice sent by remote printing must be regarded as a paper invoice.

The bulletin also provides examples for business controls that taxpayers may use in the course of issuing and retaining electronic invoices to ensure the authenticity of the origin, the integrity of the content and the legibility of the invoices. This general concept, which has so far required much explanation, could now become clearer, because, in the Tax Authority’s opinion in the case of electronic invoices such controls may be established both electronically and by logical deduction.

Finally, the bulletin addresses the issue of retaining electronic invoices and the legal consequences of non-compliance with applicable regulations. The Tax Authority warns companies that both invoice issuers and invoice recipients must ensure that the relevant requirements are met.

Although the bulletin does not cover the latest e-invoicing methods, we note that under certain conditions .xml files submitted during online invoice reporting may also be regarded as electronic invoices.

While the Tax Authority’s bulletin on electronic invoicing provides theoretical answers to key questions of the topic, it also leaves open some practical questions, to which taxpayers must find their own answers in the course of their operations.

If you have any questions regarding the above, please contact:

László Deák, Partner
e-mail: laszlo.deak@pwc.com

Gábor Farkas, Director
e-mail: gabor.farkas@pwc.com

Dr Kornél Szeőcs, Senior Manager
e-mail: kornel.szeocs@pwc.com