Hungary domestic reverse charge supplies of staff
Hungary has been granted leave to apply the domestic reverse charge on the supply of staff, including temporary staff.
The domestic reverse charge relieves suppliers of the obligation to charge and collect VAT on supplies to customers in their own country. It replicates the reverse charge, which does the same on intra-community supplies – transactions across EU member state borders between VAT registered businesses.
The domestic reverse charge is used to help curb instances of VAT fraud. It may only be applied with the permission of the European Commission which requires proof of fraud in the sector. In Hungary’s case, it has been granted this right on the supply of staff until December 2017.