Nothing is impossible – deducting the VAT on shareholdings

Tamás Fehér | 12 December 2018

The deductibility of the VAT content of incoming invoices has long been a source of consternation both for equity investors and for the holding companies heading up corporate groups. In a relaxation of the general ban on VAT deduction in these cases, the European Court of Justice (“ECJ”) has given ‘active’ holding companies a way around the restrictions. Meanwhile, other recent judgments by the Court have further expanded the opportunities for VAT deduction. Nevertheless, the ECJ’s decisions also show that it’s better to err on the side of caution.

Not too good to be true? New bill could give ESOPs a boost

István Csővári | 23 November 2018

“It’s such a good deal that it won’t last for long”, cried hundreds of business owners in response to the suggestions of setting up an ESOP. However, a bill recently adopted by the Parliament suggests that if a company uses this type of employee benefits scheme for its intended purpose, they should be able to count on it in the long term as well.

I am selling my company ... how am I taxed?

Ádám Fischer | 8 November 2018

A growing number of family businesses are coming up for sale these days. This is partly due to the favourable investment environment, and partly to the difficulties to pass on businesses to the next generation. A critical aspect in such deals is: what kind of tax implications the sale will have for the sellers. While, in some cases, the sale can be made tax-free, at other times a private individual divesting his or her share in the business can be faced with a tax liability of up to 34.5%.

Construction trusteeship works, except when it doesn’t

Levente Bihari | 30 October 2018

With almost ten years of hindsight we can safely say that although the construction trusteeship system created to prevent circular debt in the construction industry has essentially lived up to expectations, the system still has some unresolved flaws. What’s more, the taking effect of the new Civil Procedure Code  this January will present a further challenge for the system.

When is an export not an export? New VAT rules on intra-Community supplies of goods

Tamás Fehér | 18 October 2018

The rules on VAT-exempt intra-Community supplies of goods have long been a source of worry for businesses. It is not uncommon for the tax authority to deny tax exemption on such transactions on the grounds that the goods never left the country. Although a recently accepted proposal by the EU clarifies the rules, complying with them entails a great deal of bureaucracy for companies that deliver to EU markets.

Filing problems

Péter Barta | 10 October 2018

Since January this year, it’s been more difficult than ever to litigate in Hungary. Courts have been rejecting countless petitions, filed by even the most experienced lawyers, citing professional inaccuracies or formal errors. The stringent policy is likely to prompt parties with grievances to use alternative forums for the settlement of disputes.

Open season for VAT number shopping?

Dániel Veres | 14 August 2018

In its judgement passed a few weeks ago, the treatment of European Court of Justice (ECJ) was flexible in the interpretation of the VAT “triangular transactions”. While this decision in favour of the taxpayer creates a tax planning opportunity for businesses involved in international trade of goods, it pays off to be cautions on the other side.

The cost of venture capital

Ágnes Bejó | 27 July 2018

Venture capital funds financed partly or entirely with government money have been all the rage in the equity markets these past few years. Initially the Jeremie funds pumped capital into the market in four successive rounds, but as the placement period for this scheme ended, the first solely state-owned venture capital investor also entered the market. And from this year on, new venture capital funds with EU money at their disposal are coming on stream, as well as a state-financed equity fund is set up to assist ventures with potential for future stock exchange listing.

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Who is this blog addressed to?

The law is constantly in flux. While many people may find this intimidating, for us it’s precisely what makes it so exciting. We’d like to share this attitude with businesspeople and managers, and with those who just have an interest in business law, in the form of a regularly updated blog that discusses the latest tax law and commercial law issues in an accessible style. Feel free to send your questions and suggestions for topics you’d like us to cover to blog@jalsovszky.com.

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