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Invoice data reporting – Data reporting and error handling process

The technical documentation on real-time invoice data reporting is already available on the webpage of the tax authority. From the description it turns out – if it has not been clear so far - that financial, taxation-related, and IT competencies are required for solving the new task of companies, all throughout the process.

Substantially all useful information can be found in the tax authority documentation, ranging from the regulatory environment through the description of the registration process to technical specifications. Hereby in our summary, we provide a review of the RTIR process. 

The process of preparing for data reporting 

1. Registration to HU TA for online invoice data reporting 

The first step is registration, to be performed by the taxpayer’s statutory representative or permanent agent. In the course of registration, secondary users can be specified, so the taxpayer or its statutory representative or permanent agent authorized therefor may provide access to the data supplied through the interface to further individuals. 

2. Generation of a technical user at the company 

The next step is to generate a technical user. Thus, a virtual user is required to be generated, which is important for carrying out the data reporting, so this is not about the particulars of a real person. The technical user goes with a signature code and an exchange code. 

3. Data reporting to HU TA’s system 

Following registration, data reporting can be carried out in possession of the technical user. Data reporting must be an automatic process without human intervention, which provides data automatically to the Tax Authority upon invoice closure according to the following steps: 

  • Generate invoice data to be reported after the party liable to report data has issued the invoice. 
  • Request a token – a single ticket to be used for completing data reporting – from the tax authority. 
  • Process the response from the tax authority, storing the token and its validity. 
  • Submit the data reported on the invoices generated, according to the schema specified by HU TA. 

Encrypted messages ensure secure data exchange with HU TA 

The token sent by HU TA is an identifier required for submitting the data reporting and is valid only for five minutes. Such an identifier is generated for each instance of data reporting, entitling to submit certain invoice data. A token request includes the taxpayer’s tax number, the signature code and the login name of the technical user. This is why the technical user is also required to be registered; based on the token request, the party reporting data is unambiguously identified by the tax authority, all being encrypted. 

Data reporting, invoice data, and token requests are subject to different methods of encryption. Moreover, the response message received from the tax authority is also encrypted, which must be decrypted and coded by using the exchange code so that the company’s data reporting system can interpret it. A token request is followed by forwarding the data content of an invoice in an XML format, at least as per the VAT Act, but additional information can also be reported to HU TA. 

4. Responses received from HU TA are also required to be handled 

The complex task of invoice data reporting is not finished by data reporting: data reporting cannot be deemed as completed until it is made sure that processing was successful and the message on the acknowledgement of receipt related to the invoice concerned is received. 

Therefore, companies have further tasks to do as follows:  

  • Receive the response from the HU TA and store the transaction ID. 
  • Query data reporting status data. 
  • Store and process the response by the tax authority, and rectify any errors related to data reporting. 

If your data reporting is received by the system of the tax authority, you will get a transaction ID code. If no such code is received, data reporting must be repeated. If the transaction ID is available, you are not done yet because processing status is required to be queried by using the identifier. Data reporting is completed if the status query is successful and “OK” or “Warn” type feedback is received from HU TA. 

An “Error” type error message indicates that data reporting is failed, with errors in the data reporting content. The cause of such error must be revealed and eliminated, and afterwards, data reporting must be repeated; until this is completed, data reporting is not deemed as fulfilled and the company can be sanctioned! 

The company has further things to do in case of “Warn” or “Error” type error messages! 

The tax authority makes a distinction between “Error” and “Warn” type data reporting. 

Data reporting marked with a “Warn” type (yellow light) message is accepted. Such error can be received, for instance, by reason of an incorrect country code or an incorrect VAT code. So a “warn” message is received when the data reporting content is or may be incorrect. These errors are also recommended to be corrected or at least to be dealt with in an attempt for total compliance. 

An “Error” type message should be pictured as a red light: if such an error is made, data reporting is not accepted by the tax authority. Such error messages indicate, for instance, that the seller’s tax number is missing or invalid, or the invoice does not include any items. If the error comes from data reporting, it must be corrected. But if the error was made in invoicing, then the invoice is required to be corrected as well.  

What to do in case of a content error in data reporting? 

As a matter of course, data reporting submitted with errors and accepted can also be recalled independently of error messages, subject to approval by the taxable person obligated for tax authority data reporting in the system of the tax authority. 

If there is a problem on the side of the taxpayer due to errors in data reporting, it must be corrected within 3 working days of noticing such error. If the problem is failed to be rectified, the data reporting obligation must be fulfilled by a manual recording of the obligatory data content, as per the VAT Act, of the invoice issued or the document regarded as equivalent to an invoice. 

What to do in case of a technical problem? 

A technical problem – e.g. an internet failure or business interruption – may occur at both the tax authority and the taxpayer. Should a breakdown exceeding 48 hours occur at the company or at its service provider, the tax authority is required to be notified thereof upon the expiry of such 48 hours, at the latest. In such a case, 24 hours are available for recording the data content manually if the failure or the internet service deficiency continues. 

If there is a problem at the tax authority due to a breakdown, then the tax authority shall publish an announcement on its website about the breakdown and after the elimination of such breakdown. And within 24 hours from the elimination of such breakdown, any failed data reporting must be supplied. 

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