As many other EU Member States, Hungary has also, as of 2019,
implemented certain provisions set out in the ATAD.
As a consequence of the implementation of the ATAD, the general
anti-avoidance rule (GAAR), the rules on controlled foreign
companies (CFC) and the thin capitalization rules have undergone a
major overhaul.
The general anti-abuse rule has been extended to cover
arrangements which are contrary to the object or purpose of the
applicable tax law and which are not substantiated by a genuine
business or commercial reason. Costs and expenses incurred may not
be deducted for tax purposes and tax benefits cannot be claimed
with respect to such arrangements. Tax benefits may be claimed
insofar as the underlying arrangement or series of arrangements is
in line with the object or purpose of the applicable tax law and is
also substantiated by a genuine business or commercial reason.
