International Tax Review is part of the Delinian Group, Delinian Limited, 8 Bouverie Street, London, EC4Y 8AX, Registered in England & Wales, Company number 00954730
Copyright © Delinian Limited and its affiliated companies 2023

Accessibility | Terms of Use | Privacy Policy | Modern Slavery Statement

FREE: How the new UK-Hungary DTA will improve certainty

The UK and Hungary have signed a comprehensive agreement for the avoidance of double taxation that will provide increased cross-border certainty between the two countries.

The treaty was signed on Wednesday 7 September and will enter into force once both countries have finalised the necessary parliamentary procedures.

A previous treaty had been signed in 1977.

The treaty covers taxes on income and on capital gains imposed on behalf of a contracting state, as well as providing clarification over issues of residency and permanent establishment.

Greg Dorey, British ambassador to Hungary, said the agreement will increase confidence in cross-border trade.

“Since bilateral trade has reached record levels and the citizens of our two countries increasingly contribute to both of our economies, this is good news.”

“It also helps contribute towards a stable business environment which can foster foreign investment. And it protects governments’ taxing rights and against attempts to avoid or evade tax liability,” he added. “So this is an important step in making sure that our citizens pay their fair share towards the costs of our governments and the important services they provide.”

The treaty comes at a time when the UK government has been seeking stakeholder comment on legislation that was intended to combat tax avoidance schemes which exploit DTA provisions. Last week the Treasury announced it is cancelling that consultation. The cancellation is welcome, said one adviser.

“The cancellation of the consultation on double tax treaties, launched in summer, and confirmation that the government will adopt a more targeted approach in future, will be greeted with a sigh of relief,” said Chris Sanger, head of global tax policy at Ernst & Young. “Had the government’s proposals gone ahead, UK competitiveness would have been eroded. It would have hit commercial transactions by restricting access to funding markets and hiked up costs of investing into the UK.”

more across site & bottom lb ros

More from across our site

ITR’s latest quarterly PDF is going live today, leading on the EU’s BEFIT initiative and wider tax reforms in the bloc.
COVID-19 and an overworked HMRC may have created the ‘perfect storm’ for reduced prosecutions, according to tax professionals.
Participants in the consultation on the UN secretary-general’s report into international tax cooperation are divided – some believe UN-led structures are the way forward, while others want to improve existing ones. Ralph Cunningham reports.
The German government unveils plans to implement pillar two, while EY is reportedly still divided over ‘Project Everest’.
With the M&A market booming, ITR has partnered with correspondents from firms around the globe to provide a guide to the deal structures being employed and tax authorities' responses.
Xing Hu, partner at Hui Ye Law Firm in Shanghai, looks at the implications of the US Uyghur Forced Labor Protection Act for TP comparability analysis of China.
Karl Berlin talks to Josh White about meeting the Fair Tax standard, the changing burden of country-by-country reporting, and how windfall taxes may hit renewable energy.
Sandy Markwick, head of the Tax Director Network (TDN) at Winmark, looks at the challenges of global mobility for tax management.
Taxpayers should look beyond the headline criteria of the simplification regime to ensure that their arrangements meet the arm’s-length standard, say Alejandro Ces and Mark Seddon of the EY New Zealand transfer pricing team.
In a recent webinar hosted by law firms Greenberg Traurig and Clayton Utz, officials at the IRS and ATO outlined their visions for 2023.