Practical interpretation of Decree No. 45/2025 (XII. 23.) of the Minister for National Economy

In our previous newsletter, we outlined the legislative changes affecting the accounting treatment of transfer pricing adjustments. In this article, we provide a more detailed overview of the key provisions of Decree No. 45/2025 (XII. 23.) of the Minister for National Economy, promulgated on 23 December 2025, which significantly revises the content and formal requirements of transfer pricing documentation.

The new rules must be applied mandatorily to tax years starting in 2026. At the same time, taxpayers may decide to apply the new provisions already to the local file for tax years starting in 2025. In such cases, however, the master file remains subject to the previous regulation, namely Decree No. 32/2017 (X. 18.) of the Minister for National Economy. The choice of timing requires careful preparation, given the increased level of detail and the objectives of the new requirements.

Purpose of the changes

The aim of the new decree is to enhance transparency, align Hungarian practice more closely with international transfer pricing standards, and support tax authority audits. To achieve this, the documentation requirements are more closely linked to transfer pricing data reporting and require more detailed analyses in several areas.

Why preparation is essential

The transition will involve additional administrative efforts and a review of existing documentation processes, particularly in the first year of application. The new regulation introduces several changes that affect the application of exemptions, the depth of analyses, and the preparation of underlying data.

Key changes introduced by the decree

The documentation exemption thresholds are revised. A threshold of HUF 500 million is introduced for the master file and HUF 150 million for the local file, while the full exemption previously available for cost recharges is abolished.

The scope of mandatory documentation elements is also expanded. Detailed transaction characterisation becomes required, together with a benefit test for services and a DEMPE analysis for intangible assets. In addition, database screening rules are tightened, and the preparation of segmented profit and loss statements distinguishing between related-party and third-party transactions becomes mandatory.

The decree also clarifies the practical application of the concept of related-party transactions. A related-party transaction may exist even in the absence of invoicing and may also arise in relation to transactions with natural persons. Requirements regarding the language and retention of documentation are tightened as well: documentation may only be prepared in Hungarian, English or German and must be retained for at least eight years.

Practical implications

Companies will be required to prepare more detailed and transparent schedules that clearly demonstrate the links between accounting and financial data. The alignment between transfer pricing documentation and data reporting will become closer, and taxpayers will be required to provide more detailed justifications for the application of exemptions.

Our recommendation

We recommend that companies review their related-party transactions at an early stage, prepare for DEMPE analyses and segmented profit and loss statements, and reassess their documentation processes. It is also advisable to consult with transfer pricing experts to determine the optimal timing for applying the new regulation and to evaluate the potential advantages and risks associated with early adoption.

Should you have any questions regarding the practical application of the new transfer pricing documentation rules, our transfer pricing advisory team will be pleased to assist.