Obligatory Bank Account Registration

According to Act CL of 2017 on Taxation, companies have to announce information about their foreign bank account(s) to the National Tax and Customs Administration (in Hungarian “NAV”). The deadline for the registration is 31 January 2018.

All domestic business organization must report the number of all valid bank accounts held by a foreign financial entity. Besides, it is mandatory to register the name of the foreign financial institution managing the account and the date of account opening and cancelling. The companies must also announce any changes in connection with the foreign bank accounts in 15 days from the modification.

Those companies who miss the registration obligation, may be subject to a tax penalty up to 600.000 HUF from the Tax Office.

The NAV can be primarily become aware of a company’s foreign bank account through tax audits for example when payments for a Hungarian company are done to a foreign bank account.

In case of the Tax Office finds that the company has failed to register the opening or the modification of the bank account, the authority requests supplemental information from the company. The company has to register the foreign bank account within 15 days from receiving the tax authority’s request. If the company does not announce the requested data it may receive 100.000 HUF fine according to section 221. of the Act CL of 2017 on Taxation. The company has 30 days from the first request of the tax authority to register the requested data, if not, the amount of the tax penalty can be 500.000 HUF.

Should you need further assistance in the registration, please do not hesitate to contact us anytime.

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