Who Can Represent a Company Before NAV in Hungary?
When a company needs to deal with the Hungarian Tax Authority (NAV), the managing director does not necessarily have to handle every matter personally. Depending on the circumstances, the company may be represented by an authorized representative or attorney.
This can be particularly important when a company is facing a NAV tax audit, a tax authority procedure, an official request for information or another complex tax-related matter.
According to NAV's official guidance, where personal appearance is not required by law, a taxpayer may generally act through a legal representative, organizational representative or authorized representative. The relevant representation must be properly registered with NAV.
Who Can Act on Behalf of a Company Before NAV?
Several different types of representatives may act on behalf of a company before NAV, depending on the particular matter and the legal basis of the representation.
1. The company's legal representative
A company's legal representative, such as a managing director with individual signing authority, may act directly before NAV in appropriate cases.
For companies registered in the Hungarian company register, NAV generally receives information concerning the legal representatives from official records. As a result, an individual legal representative normally does not need a separate representation registration in the same way as an appointed representative.
This does not mean that the managing director has to handle every NAV matter personally.
2. Can an authorized representative act for the company?
Yes.
A company may appoint an authorized representative in NAV matters where the applicable rules do not require personal action.
Depending on the circumstances, the representative may be a properly qualified individual, legal entity or professional who has the necessary statutory authority to act.
An authorization can be permanent or specific to a particular matter. A permanent authorization may cover ongoing tax administration, while an individual authorization can relate to a specific case or procedural step.
The exact requirements depend on the nature of the representation and the procedure involved.
3. Can an accountant or accounting firm represent a company before NAV?
Yes, in certain circumstances.
Accounting firms, bookkeepers and tax advisers may act as NAV representatives where the applicable requirements are met.
NAV introduced changes to the rules concerning permanent representation from 1 February 2025. In certain cases, the permanent authorization is connected to the accounting or tax-advisory organization, which may then designate the individual who will act on behalf of the client.
This means that an accountant or accounting firm can continue to play an important role in dealing with NAV.
However, accounting representation and legal representation are not the same
thing.
4. When should a company involve a lawyer?
For routine tax administration or document submission, an accountant or other tax representative may be sufficient.
The situation can be different when the matter involves a legal dispute or significant legal risk.
This may include:
a NAV tax audit;
a significant potential tax assessment;
disputed contracts or transactions;
complex VAT issues;
related-party transactions;
a procedure concerning cancellation of the company's tax number;
the need for a legal remedy or appeal;
or a NAV procedure connected with company-law issues such as forced deletion.
At that point, the question is no longer simply what information should be submitted to NAV, but also what the company's legal position is, what statements should be made and what remedies may be available.
This is where the involvement of an attorney with tax-law experience may become particularly relevant.
5. What is the difference between an accountant and a lawyer?
The roles of the accountant and the lawyer are often complementary rather than mutually exclusive.
An accountant will usually have detailed knowledge of the company's:
accounting records;
tax returns;
invoices and supporting documents;
financial transactions;
bookkeeping and tax processes.
A lawyer, on the other hand, can focus on legal questions such as:
the legal basis of the NAV procedure;
the company's rights and obligations;
the legal significance of statements made to NAV;
procedural issues;
possible legal remedies;
and whether legal representation is appropriate.
For a complex matter, the most effective approach may therefore be not accountant or lawyer, but accountant and lawyer working together.
6. How is representation registered with NAV?
A representative must be properly registered with NAV.
NAV's current guidance provides for the UJEGYKE form as one of the mechanisms used to register representation. The registration can be handled through the ONYA or ÁNYK systems, depending on the circumstances. Certain legal representatives do not require a separate registration because NAV receives the relevant information from official registers.
Permanent representatives and organizational representatives generally need to have their authorization properly registered before they begin acting on behalf of the client.
The precise formal requirements depend on the type of representation and the specific procedure. NAV also provides specific guidance concerning permanent authorizations granted to attorneys and their electronic acceptance.
For a complex case, it is therefore advisable to check the formal requirements before the first submission or procedural step.
7. What about a foreign-owned company in Hungary?
For foreign-owned companies, the question of representation can be especially important.
A foreign shareholder or director may not know:
who is legally entitled to deal with NAV on behalf of the company;
what type of authorization is required;
how the representative must be registered;
which electronic procedures apply;
or when legal representation becomes appropriate.
In such circumstances, it can be particularly useful to work with a Hungarian attorney who can communicate in English.
This is not only a matter of language. The foreign owner or director also needs to understand what type of Hungarian tax authority procedure is involved, what decisions may be made and what options may be available.
8. When should a company involve a lawyer at the beginning of a NAV procedure?
Not every NAV matter requires a lawyer.
However, it may be sensible to obtain legal advice early when:
NAV has started a tax audit;
a disputed tax-law issue has arisen;
there is significant potential tax exposure;
cancellation of the company's tax number is being considered;
a legal remedy may be required;
or the foreign owner or director is not familiar with the Hungarian procedure.
Timing can matter because some options may become more limited as a procedure progresses.
Frequently Asked Questions
Is a lawyer required when NAV contacts a company?
No. The appropriate form of representation depends on the type and circumstances of the matter.
Can my accountant represent my company before NAV?
Yes, in certain circumstances. Properly authorized and registered accountants or accounting organizations may represent clients before NAV.
When does a lawyer become more important?
A lawyer may become particularly relevant when the matter involves a legal dispute, significant tax exposure, procedural questions or a potential appeal.
How do I register a representative with NAV?
The applicable representation must be properly registered with NAV. In many cases this involves the UJEGYKE form, while the exact procedure depends on the type of representation and the client.
Can a foreign owner authorize a Hungarian lawyer to act for the company?
The required authorization and formalities depend on the particular case and applicable procedural rules. The relevant requirements should be checked before the representative begins acting.
Legal Representation Before NAV in Hungary
If your company is facing a NAV procedure, tax audit or another tax-related issue, it can be important to determine early whether an accountant's assistance is sufficient or whether legal representation is also appropriate.
Dr. Gábor Major provides legal assistance and representation in Hungarian and English in tax-law and NAV-related matters.
