Hungary Includes Transitional CbCR Safe Harbour Amendments in its 2025 Autumn Tax Package

On October 2, 2025, Hungary released the 2025 Autumn Tax Package. This includes some amendments to the operation of the Transitional CbCR Safe Harbour. A bill was also issued for EU DAC 9 implementation. The Act is to enter into force on the day following its promulgation.

Transitional CbCR Safe Harbour

The main amendments relate to the application of the Transitional CbCR Safe Harbour.

Section 32 of the Minimum Tax Act provides for the basic rules for the safe harbour for Hungarian tax purposes. In particular, Section 32(2) provides for the three key tests (De-minimis test, ETR test and the Routine profits test).  However, Section 32(4) provides that the detailed rules will be determined by a ministerial decree.

Whilst the draft law in the Autumn Tax Package does not provide all of the detailed rules, it does expand on the definition of simplified covered tax to be used for the simplified ETR test as well as determining what is a Qualified Country-by-Country Report and Qualifying Financial Statements.

Simplified covered taxes for the purposes of the Simplified ETR test are defined as income tax expenses recognised in the qualifying financial  statements including deferred tax expense, but excluding covered taxes, uncertain tax positions recognised in the qualifying financial statements, and income tax expenses arising from Hybrid Arbitrage arrangements. The detailed rules for the application to Hybrid Arbitrage arrangements are to be provided by Ministerial Decree.

This is in alignment with the OECD definition of simplified covered taxes.

A new Section 32a included in the Draft Law provides for the determination of a Qualifying CbC Report.  In particular it provides rules for Groups that are not required to prepare and file CbCR reports (eg domestic groups).

The December 2023 Administrative Guidance provides that they can still qualify for the Transitional CbCR Safe Harbour if they complete section 2.2.1.3(a) of the GloBE Information Return using the data from Qualified Financial Statements that would have been reported as Total Revenue and PBT in a Qualified CbC Report if the MNE Group were required to file a CbC Report.

For this purposes, “as reported in a Qualified CbC Report” means the amounts that would have been reported in a Qualified CbC Report if the MNE Group were required to file a CbC Report in accordance with the CbC requirements in the UPE Jurisdiction (or, if the UPE Jurisdiction does not have CbC requirements, the amounts that would have been reported in accordance with the OECD BEPS Action 13 Final Report and the OECD Guidance on the Implementation of Country-by-Country Reporting).

This is reflected in the new Section 32a.

A new Section 32b is to be inserted in the Minimum Tax Act to define Qualified Financial Statements in accordance with the OECD Safe Harbour guidance as:

-Accounts used to prepare the Consolidated Financial Statements of the UPE (which reflects the same requirement under Article 3.1.2 of the GloBE rules);

-The separate financial statements of each Constituent Entity provided they are prepared in accordance with either an Acceptable Financial Accounting Standard or an Authorised Financial Accounting Standard if the information contained in such statements is maintained based on that accounting standard and it is reliable; or

-In the case of a Constituent Entity that is not included in an MNE Group’s Consolidated Financial Statements on a line-by-line basis solely due to size or materiality grounds, the financial accounts of that Constituent Entity that are used for the preparation of the MNE Group’s CbC Report.

DAC 9

The Draft Law implements the EU DAC 9 amendments. This simplifies reporting in-scope groups by enabling central filing of a top-up tax information return (TTIR) and introduces a standard form for filing the TTIR across the EU, in line with the GIR.