The Hungarian Tax and Customs Administration (NAV) has once again begun launching a larger number of support procedures in connection with income derived from foreign investments. Based on the experience of RSM’s tax experts, affected private individuals are currently primarily encountering support procedures. However, based on NAV’s practice before the summer, taxpayers should also be prepared for an increase in the number of compliance reviews. An important feature of NAV’s 2026 enquiries is that the tax authority is not focusing on one single, uniform tax year. According to RSM’s experience, NAV is examining different years within the 2020–2024 period and typically requests information for two tax years at the same time. As a result, affected individuals may have to review two full years of foreign investment transactions, tax calculations and personal income tax returns within a very short period and, where necessary, submit self-revisions of previously filed tax returns.
What does NAV examine in relation to foreign investment income?
NAV enquiries may cover interest and dividends credited to accounts held with foreign banks, proceeds from the sale, redemption or maturity of securities, as well as returns from other investment products. In order to determine the correct Hungarian tax treatment, each transaction must first be classified in accordance with the Hungarian Personal Income Tax Act.
It makes a significant difference whether the income qualifies as interest income, dividend income, capital gains, income from controlled capital market transactions or another type of income. This classification determines, among other things, which costs may be deducted, whether losses and tax equalisation may be taken into account, the rules applicable to conversion into Hungarian forints, and whether the 15% personal income tax liability is accompanied by a social contribution tax. The precise tax burden may depend, among other factors, on the type of financial instrument and transaction, the place and date of performance, and the country from which the income originates.
Foreign investment income – NAV reviews in 2026
Szilvia Süli, Manager in RSM Hungary’s Tax Services practice, explained: “In recent weeks, we have seen NAV once again launch a large number of support procedures in connection with foreign investment income. At present, we are mainly seeing support procedures rather than compliance reviews, but based on our previous experience, we expect the number of compliance reviews to increase during the autumn. We are seeing that in autumn 2026 NAV is examining different years from the 2020–2024 period and, rather than looking at just one year per taxpayer, it is immediately reviewing two years at the same time. This means that, where necessary, tax returns and complete supporting documentation for two years may have to be put in order within a very short period.”
NAV’s 2026 audit plan expressly states that financial account and income information available through international automatic exchange of information will be used in support procedures. According to the plan, non-cooperative taxpayers with the largest identified tax discrepancies may also face compliance reviews.
Why does NAV have visibility over foreign bank accounts and investments?
The fact that a private individual holds an account with a foreign bank does not mean that income generated on that account falls outside the scope of the Hungarian tax authority’s visibility. Under the EU DAC2 Directive and the OECD Common Reporting Standard (CRS), financial institutions in participating jurisdictions automatically report information on financial accounts held by customers who are tax resident in other countries. NAV may therefore receive information on, among other things, interest, dividends and certain proceeds from sales or redemptions.
Why might NAV identify a discrepancy even if the income was reported?
Control data received from a foreign financial institution and the contents of a Hungarian personal income tax return can almost never be compared directly on a like-for-like basis. In the case of the sale or maturity of securities, the information received by NAV may show the gross proceeds, while it does not include the acquisition cost, related fees, previous losses, eligible foreign withholding tax, or the information necessary to determine the correct Hungarian tax classification of the transaction.
Accordingly, a data discrepancy does not in itself necessarily mean that there is a tax shortfall. The discrepancy must be reconciled using foreign banking documentation and a tax calculation prepared in accordance with Hungarian tax rules. The latter is necessary because the annual statement issued by a foreign bank or investment service provider is not prepared on the basis of Hungarian personal income tax legislation.
NAV support procedure relating to foreign investment income: what does it mean?
The purpose of a support procedure is for NAV to draw the taxpayer’s attention to an identified discrepancy and provide an opportunity for voluntary correction.
Based on RSM’s previous experience, NAV typically expects taxpayers in such cases to reconcile discrepancies between DAC2/CRS data and the filed personal income tax return, provide foreign banking documents and tax calculations, and, where necessary, submit a self-revision of the tax return.
A support procedure is not an audit and does not, in itself, result in the imposition of penalties.
The procedure is short: NAV has 30 days to conduct it, meaning that the private individual has an even shorter period in which to obtain and interpret the necessary documents from abroad if they want the procedure to be concluded successfully. If the discrepancy cannot be satisfactorily resolved or the taxpayer fails to cooperate, NAV may initiate a further review
Support procedure or compliance review: what is the difference?
A compliance review is already a formal type of tax authority review. During such a procedure, NAV may examine whether the taxpayer has complied with specific tax obligations and may request information and documentation. A compliance review does not create a period closed by a tax audit, meaning that, subject to the statutory conditions, the tax return concerned may remain open to self-revision both during and after the review.
Unlike a support procedure, a compliance review may already result in a default penalty if the taxpayer fails to comply, or fails to comply properly, with the requirements set out in NAV’s notice. Based on the risks identified, NAV may subsequently initiate a tax audit, which can result in the assessment of a tax shortfall, a tax penalty and a late-payment surcharge.
| Key risk in 2026 NAV frequently examines two tax years simultaneously from the 2020–2024 period. A single enquiry may therefore result in twice the documentation and calculation burden: within a short period, taxpayers may need to obtain documentation from the foreign bank for two years, review or prepare the relevant tax calculations, self-revise two years of tax returns where necessary, and reconcile all of this with the tax authority. |
Why is preparation urgent if NAV requests two tax years?
Obtaining older transaction-level statements from foreign financial service providers may take considerable time. Gathering the necessary data may be particularly difficult where the account has since been closed, the service provider has changed, transactions were conducted in several currencies, corporate actions affected the number or acquisition cost of securities, or the provider only issues an aggregated annual statement.
What documents may be required in response to a NAV enquiry?
The documentation required will depend on the type of transaction and procedure, but it is generally advisable to prepare:
- annual statements for foreign bank and securities accounts;
- annual income certificates or statements issued by the foreign bank;
- individual transaction statements covering purchases, sales, maturities, redemptions and similar transactions;
- certificates relating to interest and dividend payments;
- the Hungarian tax classification of the transactions and a detailed calculation of the relevant tax liabilities;
- personal income tax returns for the years concerned and any self-revisions previously submitted.
What should you do if you receive a NAV notice initiating a support procedure or compliance review?
- Identify the procedure and the applicable deadline. Determine whether the notice relates to a support procedure, a compliance review or another type of audit, which tax years are covered, and what documentation NAV is requesting.
- Request detailed banking data immediately. Do not rely solely on the annual summary statement: transaction-level information is often required for the Hungarian tax calculation.
- Classify the transactions under Hungarian tax rules. The terminology or tax classification used by the foreign service provider may not correspond to the classification under the Hungarian Personal Income Tax Act.
- Prepare the tax calculation in accordance with Hungarian statutory requirements. Even if the bank’s annual income statement shows an overall foreign exchange or investment loss, this does not necessarily mean that no Hungarian tax liability arises.
- Submit a self-revision where necessary.
- Maintain communication with NAV. If obtaining a foreign document is taking longer than expected, notify the NAV case officer promptly and keep a documented record of the communication.
It is advisable to review tax returns before NAV makes contact
The safest approach is not to wait for a letter from NAV. Individuals who held an account with a foreign bank or investment service provider between 2020 and 2024 and earned interest, dividends, proceeds from securities transactions or income from other investments should consider reviewing their tax returns and checking whether their supporting documentation is complete in advance.
How can RSM help?
RSM’s experts can assist with interpreting NAV enquiries, processing foreign banking and investment documentation, classifying transactions under Hungarian tax law, preparing tax calculations and self-revisions, and representing taxpayers before NAV. If you have earned foreign investment income, it is advisable to assess before any procedure begins whether your tax returns for 2020–2024 and the related supporting documents are complete and readily available.
Frequently Asked Questions About NAV Reviews of Foreign Investment Income
Can NAV see my foreign bank account and investment income?
Under the DAC2/CRS automatic exchange of information framework, NAV may receive financial account and income information from foreign jurisdictions. The scope of the information depends on the type of account and income concerned.
Which years is NAV examining in 2026?
Based on RSM’s experience in late summer 2026, NAV is reviewing different years within the 2020–2024 period and frequently requests information relating to two tax years at the same time.
What is a NAV support procedure?
It is a procedure that does not qualify as an audit, in which NAV notifies the taxpayer of a data discrepancy and provides an opportunity to clarify it voluntarily and, where necessary, to submit a self-revision of the tax return.
Can I receive a penalty during a support procedure?
A support procedure itself does not result in a penalty. However, if the discrepancy is not resolved or the taxpayer fails to cooperate, NAV may initiate a formal review or audit, which may lead to sanctions.
Why is the foreign broker’s annual tax statement not sufficient?
Because the foreign service provider does not necessarily classify transactions in accordance with the Hungarian Personal Income Tax Act, and the annual summary may not contain the information required to determine acquisition costs, deductible expenses, losses or currency conversion under Hungarian rules.
Can a self-revision be submitted during a compliance review?
A compliance review does not create a period closed by a tax audit, so, as a general rule, the possibility of self-revision may remain available. However, the scope of the specific procedure and the statutory conditions governing self-revision must be assessed separately in each case.
What should I do first if NAV requests information for two tax years?
Immediately identify the applicable deadline and request the complete transaction-level documentation for both years. Then reconcile the banking data with the personal income tax returns already filed, separately for each year and each type of transaction.
