Preparation of Transfer Pricing documentation

When is transfer pricing documentation required?

If your company is a member of a domestic or international corporate group, it is highly likely that you are required to prepare transfer pricing documentation for its related-party (intra-group) transactions.

Changes in the thresholds:

• Tax year 2025 (Hybrid year): The exemption threshold from the documentation obligation will increase to HUF 150 million in the case of the Local File. However, it is important to note that for the Master File, the previous threshold of HUF 100 million will still apply in 2025.
• Data reporting obligation: In all cases, related-party transactions reaching HUF 100 million annually must be reported in the corporate income tax return (ATP sheets), regardless of whether the given transaction is exempt from the obligation to prepare the Local File.

The threshold must be determined based on the arm’s length price calculated without VAT, taking into account the combined value of contracts that may be aggregated. Key rules effective from 2026 (Decree 45/2025 of the Ministry for National Economy)

From tax years starting in 2026, the regulation will be further simplified, while professional expectations will become more demanding:

• Uniform HUF 150 million limit: The documentation obligation (for both the Local File and the Master File) will uniformly apply above a transaction value of HUF 150 million.
• Group exemption for the Master File: From 2026, a group-level exemption of HUF 500 million may be applied. If the total amount of related-party transactions at group level does not reach this amount, no Master File is required.
• Exemption for cost recharges: Recharges at unchanged value (pass-through costs) will not be subject to documentation obligation up to a threshold of HUF 500 million, provided that the final service provider is an independent party.
• Penalties: The default penalty may still be up to HUF 5 million per documentation file, and up to HUF 10 million in the event of repeated non-compliance.

RSM’s transfer pricing services

Our experts not only prepare the documents, but also audit the transactions from the perspective of data-driven tax authority audits:

• Transaction identification: We assess the company’s related-party transactions and determine which of them must be documented in the transfer pricing documentation;
• Benchmark study: Using international databases, we determine the arm’s length range and the median value;
• Documentation preparation: We compile the Local File and the Master File in line with the statutory structure;
• Data reporting (ATP): We complete the transfer pricing annexes to the corporate income tax return, ensuring consistency with the documentation;
• Methodological support: We develop the most appropriate pricing logic (TP Policy), perform benefit tests and DEMPE analyses.

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When is it advisable to engage a transfer pricing advisor?

Template-based solutions now carry high risks. Advisory support is particularly recommended if:

• the company is loss-making or achieves profitability below the industry average;
• significant management fees or intra-group service fees arise;
• royalties are paid for the use of intangible assets (licences, brand names);
• significant year-end transfer pricing adjustments are made;
• there is a change in business model or a group-level reorganisation.

Our goal is to support our clients in complying with the applicable transfer pricing regulations and in avoiding any potential sanctions related to transfer pricing.

Levels of transfer pricing documentation

In line with the OECD BEPS guidelines, the Hungarian regulation follows a three-tier structure:

• Master File: Presents the global operations and transfer pricing policy of the entire corporate group.
• Local File: A detailed functional and economic analysis of the Hungarian taxpayer’s specific related-party transactions.
• Country-by-Country Report (CbC report): Global reporting obligation for groups with consolidated revenue exceeding EUR 750 million (approx. HUF 300 billion).

Our transfer pricing experts can assist you in preparing the appropriate transfer pricing documents and transfer pricing records. Please feel free to contact our expert with your questions.

Why choose RSM’s transfer pricing documentation service?

• Outstanding transfer pricing expertise – We have more than 20 years of experience in preparing domestic and international TP documentation.
• 100+ TP documents per year – We prepare several hundred transfer pricing documentation files, data reporting packages and benchmark studies every year.
• Dedicated transfer pricing expert team – We have highly experienced professionals.
• Specialised database background – We use the latest international TP databases to determine arm’s length ranges.