Global Minimum Tax in Hungary from a transfer pricing perspective | News Flash

Achieving alignment between the Global Minimum Tax (GloBE) framework and transfer pricing regulations may represent one of the greatest challenges for multinational enterprises (MNEs) in 2025. Although both systems rely on the arm’s length principle, they differ significantly in terms of scope, exemptions, and documentation requirements. This article explores the key issues of the GloBE implementation from a transfer pricing perspective and outlines practical steps to mitigate risks.

Who qualifies as a GloBE taxpayer?

Under the GloBE rules, a corporate group qualifies as a GloBE taxpayer if the consolidated revenue of the ultimate parent entity exceeds EUR 750 million in at least two of the previous four fiscal years.

This threshold includes entities subject to Country-by-Country Reporting (CbCR) requirements over an extended period, meaning that such large groups automatically fall within the scope of GloBE.

However:

• Certain group entities – such as excluded entities or those in special sectors – may be exempt from GloBE, but their revenue still counts toward the EUR 750 million threshold.
• GloBE compliance is tied to annual reporting deadlines: starting from the second reporting year, the GloBE return must be filed within 15 months after year-end, and the “top-up tax” liability must be disclosed in the annual financial statements from the first year of applicability.

Comparing transfer pricing and GloBE

Scope of transactions

• Transfer pricing: Under Hungarian corporate tax law (Tao. Act), the arm’s length principle applies to all related-party transactions that exceed certain thresholds, regardless of whether the transactions are domestic or cross-border.
• GloBE: The arm’s length principle is required only for cross-border transactions and loss-making domestic asset transfers. Intragroup transactions beyond these are generally excluded.

As a result, some transactions may require documentation for transfer pricing purposes but not for GloBE, and vice versa.

Consolidated vs. separate financial statements

GloBE rules determine taxpayer status based on consolidated revenue, but the actual top-up tax must be calculated and paid on a country-by-country basis. By contrast, transfer pricing documentation is prepared at the entity level and submitted with the corporate tax return.

Transfer pricing documentation requirements

• According to GloBE regulations, the top-up tax must be disclosed in the profit and loss statement and the balance sheet, including any deferred tax assets or liabilities if elected. The DAC9 directive allows for centralized GloBE filing by the parent company or a designated group member on behalf of the entire group, instead of requiring separate filings in each jurisdiction. However, centralized reporting requires strong internal coordination to ensure complete and accurate information exchange within the group.
• In Hungary, transfer pricing documentation and reporting obligations are governed by Section 18 of the Corporate Tax Act and Decree 32/2017 of the Ministry for National Economy. The ATP-01 and ATP-KV structured forms are used to fulfill these requirements within the annual tax return.

GloBE-specific transfer pricing issues

GloBE-specific transfer pricing issues

Assessment of cross-border transactions

Multinational groups must assess in detail their cross-border intra-group service, sales, and financial transactions to:

• determine which fall under GloBE rules,
• and correctly reflect these in the transfer pricing study, including the basis and amount of any top-up tax, as well as the impact (if any) of such transactions on the tax liability.

Where transactions between group members with different tax residencies are recorded at different values or deviate from the arm’s length price, they must be adjusted accordingly—except when such adjustments would result in double top-up taxation or tax avoidance under GloBE.

Domestic loss-making asset transfers

Domestic asset transfers that result in losses must also be assessed under the GloBE rules. Although such losses are already considered under traditional transfer pricing documentation, the GloBE framework extends the requirement explicitly to domestic transactions as well.

Where a loss arising from an intra-group domestic asset transfer is recorded at a non-arm’s length value and is taken into account for determining profit or loss, the transaction must be adjusted to the arm’s length price, unless such adjustment leads to double taxation or circumvention of the top-up tax.

Practical steps for compliance

Data collection and preliminary assessment

• Prepare a detailed list of cross-border and domestic loss-making transactions.
• If Hungarian group members are eligible for transitional exemptions, gather consolidated (CbCR) revenue data and identify the legal basis for the exemption.

Updating transfer pricing documentation

Taxpayers should enhance existing transfer pricing studies with GloBE-specific elements:

• Determination of ETR (Effective Tax Rate),
• Calculation of the top-up tax,
• Integration of deferred tax effects.

Annual reporting and GloBE filing

If Hungarian group members fall under GloBE, they must either file the GloBE return themselves or provide the necessary financial information to the designated reporting entity. If a top-up tax arises during the fiscal year, it must be disclosed in the annual report, along with any deferred tax recognized in the balance sheet and profit and loss statement, if the taxpayer has opted for deferred tax accounting.

Expert support

A professional tax advisory partner can:

• Support the review of Transfer Pricing and GloBE processes,
• Assist in submitting transfer pricing disclosures and GloBE reports,
• Deliver workshops and training for internal teams to prepare for the evolving transfer pricing landscape,
• Recommend automated validation and control tools to streamline compliance.

Final thoughts

While the Global Minimum Tax regime is based on the arm’s length principle, it only applies to specific cross-border and domestic loss-making transactions, unlike the broader scope of traditional transfer pricing rules. Aligning documentation, ensuring consistency between consolidated and entity-level financials, and securing expert assistance are essential to avoid compliance risks.

Transfer pricing has long been a key focus area for tax authorities. From 2025, Hungary’s National Tax and Customs Administration (NAV) is allocating unprecedented resources to this field, including new specialized units that will also be responsible for auditing compliance with the global minimum tax.

If you want your company’s Transfer Pricing and GloBE processes to run smoothly, get in touch with us – we help you build integrated solutions that meet both international and domestic compliance requirements.

Köő-Tóth Zénó

Senior Transfer pricing Specialist | Accace Hungary

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