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NAV Online Invoice reporting - how to prepare for July 2020?

More than 300,000 Hungarian companies have been reporting their invoice data to the NAV online invoice reporting system for almost two years. From 1 July, this scope will be further expanded, all invoices issued between domestic business partners will be required to provide online invoice data, regardless of the VAT amount of the invoice, the reporting threshold will be reduced to zero. The expansion of the M-form obligation related to purchases can also be a nightmare for accountants.

It can only be guessed how many of the nearly 1.8 million VAT registered entities in Hungary will increase the number of those obliged to provide invoice data and use the invoicing system closely integrated with the NAV online invoicing system as of July. What is certain is that only automation can help with the expanding obligation, on the one hand because the legal requirement is pushing companies in this direction, and on the other hand, in this way efficiency can be increased while risks can be reduced.

What invoice data must be reported to the NAV Online Invoice System from 1 July 2020?

The most significant change is the expansion of the scope of invoices affected by online invoice data supply. From 1 July, the followings will be included in the invoices subject to online invoice data supply:

  • due to the elimination of the VAT threshold of HUF 100,000, invoices issued to all domestic business partners, regardless of the VAT amount,
  • reverse charge transactions and
  • transactions of taxpayers not registering for VAT.

What data are still to be reported from 1 July?

  • Regarding VAT return M-forms, the threshold will be eliminated, the M-form must be submitted for all invoice items related to the purchase of products or services, not only for items of over HUF 100,000.
  • It is mandatory to indicate the tax number of the purchasers (accounts receivable - AR) in both the invoice and the XML files, regardless of the threshold. Therefore, in corporate systems – ERP, accounting system, records – it is worth reviewing purchaser (AR) data in a timely manner, if possible, to automate their review.
  • For manual invoices, the reporting deadline is shortened from 5 days to 4 days. (There is no change regarding invoices issued with an invoicing program, the real-time reporting obligation remains in place.)

What solutions help with data supply?

The legal environment provides several solutions for connecting invoice data. Companies that use an invoicing software in which the creators of the program make available the tracking solution required by the online invoice regulation are in the simplest situation. In many cases, changes are easily updated at an affordable price and on time, without major transformation of the invoicing processes.

Compliance with the legislation is more difficult if the development of the invoicing program and the legislation tracking cannot be implemented within the invoicing system on time, either in the absence of development capacities or due to the unrealistically high cost of the necessary expenditure. In this case, the use of an external invoice reporting module that is compliant with the regulations is a good alternative. An external automatic module can provide automated data submission online and automatically report data from multiple invoicing systems of a company or company group to the NAV Online Invoicing System.

TO NAV ONLINE invoice reporting System?

The experience of our clients proves that the solution we have developed manages a dozen data of international and Hungarian companies effectively, even beyond NAV online invoice data supply possibilities.

In addition to the online invoice report module, the platform can also serve the needs of partners for VAT preparation, review, M-form preparation, and tax number review. The modular structure of the Connectax platform allows our partners to use a variety of features from one interface, choose from a “basket of services”, and to customize and parameterize their own dashboard. An additional advantage of the unified platform is that legislative and technical changes can be tracked continuously and quickly, developments are not limited by the technological constraints of large-scale, complex ERP systems.

The deadline for the live introduction of NAV Online Invoicing System version 2.0 has also been postponed to 1 July, information on the online invoice content changes required by the XML schema version 2.0 and the new encryption algorithm can be found in our previous blog posts.

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