VAT Exemption in Hungary (Alanyi Adómentesség) — Threshold, Invoice Rules, and When to Exit

The alanyi adómentesség (small business VAT exemption) is an opt-in regime available to any Hungarian sole trader or company whose annual revenue does not exceed HUF 12 million. Key points:

• Who qualifies: Sole traders (egyéni vállalkozó), kft-s, and other business forms with revenue below HUF 12 million per year. New businesses can choose it at registration.
• What it means: You do not charge VAT on your invoices and you do not file VAT returns (áfa bevallás). This reduces administrative burden.
• The trade-off: You cannot reclaim input VAT on your purchases. If you have high business costs that include VAT, run the numbers with your accountant.
• It is a choice: Even if you qualify, you can opt for VAT registration. Once you opt in, you must apply the exemption consistently for the full tax year.

VAT-exempt invoices have specific requirements under Hungarian tax law. Issuing an incorrect invoice can lead to NAV penalties:

• VAT notation: The invoice must include the phrase "Mentes az adó alól" (exempt from VAT). This is mandatory — it cannot be omitted or replaced with "0% VAT".
• No VAT amount: Do not show a VAT rate, VAT amount, or VAT summary section. The net and gross amounts must be identical.
• All standard invoice fields still required: Seller name and tax number, buyer name and tax number (for B2B), invoice date, fulfillment date, payment deadline, and unique sequential invoice number.
• NAV reporting for B2B: Despite VAT exemption, every invoice issued to a Hungarian business must still be reported to NAV Online Invoice in real time.

Bizonylat applies all of these rules automatically when your account is set up as VAT-exempt. You cannot accidentally issue a wrong invoice format.

Crossing the threshold is one of the most important events for a VAT-exempt business. The rules are strict:

1. Monitor your running total: Track your cumulative revenue throughout the year. Once you approach HUF 12 million, increase vigilance.
2. Notify NAV immediately: When you exceed the threshold, you must notify NAV and transition to VAT-registered status. This cannot wait until year-end.
3. Switch your invoices: The invoice that causes you to exceed the threshold — and every subsequent invoice in that year — must include VAT at the applicable rate (typically 27%).
4. File VAT returns: Once VAT-registered, you must file monthly or quarterly VAT returns (depending on your classification) and pay the VAT collected.

Bizonylat does not automatically switch your VAT status — this requires a conscious decision and NAV notification. Your accountant should guide you through the transition.

Bizonylat is purpose-built for Hungarian compliance, including VAT-exempt businesses:

• Correct notation automatically: When you select VAT-exempt status during setup, all invoices are generated with "Mentes az adó alól" and without a VAT section.
• NAV Online Invoice reporting: B2B invoices are reported to NAV in real time via API, with no manual steps required. See our NAV Online Invoice page for full details.
• Revenue tracking: Your dashboard shows your cumulative revenue, so you always know how close you are to the HUF 12 million threshold.
• Free plan available: VAT-exempt sole traders with low invoice volume can use the Free plan (0 HUF/mo, 10 invoices/month) with full NAV compliance included.