Tag Archives: Jalsovszky Law Firm

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It Will Soon Be Officially Possible To Reclaim Debt On Bad Debts

It has been clear for sometime that Hungary is in breach of EU law by not allowing the refunding of VAT on bad debts.  The fact that cases of Hungarian taxpayers have now been brought before the the European Court of Justice (ECJ) has forced Hungarian law makers  to move on the issue.  While the package of tax amendment submitted last week provides an opportunity to reclaim such VAT, and certain cases – due to the planned administrative restrictions –  it will still only be possible to enjoy this right with reference to EU law.

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On The Way To A Fairer VAT System

The European court of justice (ECJ) has declared in a recent case that with checking VAT transactions, the tax authority cannot ignore examining the full budgetary impact. Thus it is not acceptable for the authorities to deny the right of VAT deduction to a taxpayer without allowing the other taxpayer to accordingly reclaim the VAT that is paid. Furthermore, the court has also found it unacceptable for the tax authority to base a fine only on the amount of the VAT deducted unlawfully without examining the text shortfall actually caused. The ruling can be considered as another important step towards the creation of a fair VAT system.

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There is Life After Death For Companies!

If somebody dies unexpectedly, it’s not only a terrible loss for the grieving family and friends, but can also be a tragedy for the company of which the deceased was a member. At such times, the company can find itself unable to make decisions, even if the deceased only held a small share in the business. However, solutions do exist to enable the testator not only to make provisions for family members in the event of his or her death, but also to make sure that the company can continue to make decisions.

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ALL THAT IS SOLAR IS NOT GOLD

A trendy investment product of recent years has been solar energy projects: under the feed-in tariff (FIT) scheme, the government guarantees what looks like a cash cow for all those who choose to seek a fortune in this sector. But as is usually the case, this money won’t just fall into your lap. Without the necessary professional expertise for the proper legal groundwork, solar power projects can easily run out of steam too.

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Even the General Meeting Can Change its Mind

The general meeting of a company can now lawfully amend its previously adopted resolutions. This is especially good news for those shareholders who wish to withdraw extra dividend from their subsidiary mid-year.

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A Favorable Tightening of the Rules? The Rules on Thin Capitalisation are Changing

Due to an EU directive adopted last year, certain rules on corporate tax are changing with effect from 2019 – including the provisions on interest deduction due to “thin capitalisation.” Although the purpose of the directive was to defeat tax avoidance and tighten up the tax regulations, the new rules on interest deduction are actually becoming more of a blessing than a curse for businesses in Hungary.

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Jalsovszky-new practice area, new partner

Jalsovszky has started a new litigation team as a separate practice group. At the same time, we are also proud to announce an organizational change: our attorney Tamás Fehér will continue his career as a partner of Jalsovszky.

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Nothing is Impossible – Deducting the VAT on Shareholdings

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 the 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 expand of the opportunities for the VAT deduction. Nevertheless, the ECJ‘s decision also show that it’s better to err on the side of caution.

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

“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.

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I am selling my company… how am I taxed?

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%.

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