leitnerleitner SURPRISINGLY SIMPLE - ABOUT TAXES Tax optimization LeitnerLeitner tax audit advisory

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leitnerleitner tax audit advisory Tax optimization LeitnerLeitner SURPRISINGLY SIMPLE - ABOUT TAXES

LeitnerLeitner is one of the most influential tax consulting, accounting and auditing companies in Central Europe. Our mission is to support companies in the region to achieve their business objectives. We have comprehensive knowledge on the legal environment of countries in the region owing to our network operating in thirteen locations in Central Europe, and the 50-year-old experience and the cooperation of our 650 expert colleagues. With the help of our other international partners we can provide our Clients anywhere in the world with high quality services. belgrade bonn bratislava bucharest budapest linz ljubljana prague salzburg sarajevo sofia vienna warsaw zagreb zürich

Márta Siklós Judit Jancsa-Pék LL.M. partner, leading consultant Hungarian and international taxation, audit, M&A and due diligence of companies T +36 1 279 29 30 E marta.siklos@leitnerleitner.hu partner, leading consultant Hungarian and international taxation, VAT, tax allowances, transfer pricing, M&A and due diligence of companies T +36 1 279 29 46 E judit.jancsa-pek@leitnerleitner.hu The three main professional fields of LeitnerLeitner are tax advisory, accounting-payroll and auditing. In the following pages, we would like to provide some brief examples on how the client-focused consulting with complex approaches creates value, providing a stable background for the efficient operation of your company. Such cases involving the synergies of participating experts from our various fields of profession can prove what the values followed by LeitnerLeitner really mean. leitnerleitner

Tax advisory services REPRESENTATION IN TAX AUTHORITY AUDITS VALUE ADDED TAXATION (VAT) -- preliminary evaluation of transactions -- international VAT transactions - triangular simplification - chain transactions - supply with installation and assembling - VAT refund - contract manufacturing - fixed establishment - VAT proportioning - commissionaire transactions -- comprehensive VAT compliance and administrative services -- carrying out VAT tax reviews -- mapping -- hotline services TRANSFER PRICING PERSONAL INCOME TAXATION CORPORATE INCOME TAXATION TAX ADVISORY SERVICES IN SPECIAL ENTERPRISE CONSTELLATIONS: E.G. TRANSFORMATION (M&A), LIQUIDATION PROCEDURES TAX AND FINANCIAL DUE DILIGENCE OTHER TAXES: ENVIRONMENTAL PROTECTION PRODUCT FEE (GREEN TAX), PUBLIC HEALTH PRODUCT TAX, LOCAL BUSINESS TAX QUADRATING THE TRIANGLE Does your company also have international transactions? Are you sure to follow the proper VAT treatment in all cases? No? You are not alone. Due to the incorrect handling even if it comes from the lack of knowledge penalty could be levied on your company. Take for example the triangular transactions. Very simplistically, if three companies registered in three different EU-member states participate in the trade of a product, it is possible that the middleman (chain link) does not have to ask for tax number, submit VAT return, and pay VAT in the country where the products were delivered. However, for the legitimate use of triangular simplification the procedure should be taken with caution. Despite of this, if turns out that for example there are four companies in the transactions instead of the assumed three participants: the case leads to VAT shortage, additional administrative tasks due to the subsequent registration and penalties. LeitnerLeitner can help in such cases as well: we correct the mistake, reclaim the VAT and reduce the amount of the penalty. However, if you would avoid these pitfalls right at the beginning, it is worth to ask for advice at the time of contracting. One of our most important VAT successes is that our Clients have been able to operate without any major tax authority challenges for years. Accounting, payroll Auditing and relating services

FIVE CALM YEARS The transfer pricing regulation challenging the applied inter-company prices and the transfer pricing documentation obligations make the everyday life of whole company groups difficult. LeitnerLeitner has prepared more hundreds of transfer pricing studies and documentations in the last years and has completed numerous successful tax audits. However, it can be a more convenient and safer solution for our Clients to apply the preliminary transfer pricing determination by the tax authorities, the so called APA procedure. We have recently carried out a database research for a pharmaceutical company relating to their commercial activities and have successfully represented them in the APA procedure. As a result, the tax authority confirmed the transfer prices applied by the company. Therefore, the company does not have to bother with the transfer pricing documentations in the next five years. Tax advisory services REPRESENTATION IN TAX AUTHORITY AUDITS VALUE ADDED TAXATION (VAT) TRANSFER PRICING -- transfer pricing documentations -- transfer pricing studies -- AMADEUS database research -- benchmark studies -- representation in APA procedures PERSONAL INCOME TAXATION CORPORATE INCOME TAXATION TAX ADVISORY SERVICES IN SPECIAL ENTERPRISE CONSTELLATIONS: E.G. TRANSFORMATION (M&A), LIQUIDATION PROCEDURES TAX AND FINANCIAL DUE DILIGENCE OTHER TAXES: ENVIRONMENTAL PROTECTION PRODUCT FEE (GREEN TAX), PUBLIC HEALTH PRODUCT TAX, LOCAL BUSINESS TAX Accounting, payroll Auditing and relating services

Tax advisory services REPRESENTATION IN TAX AUTHORITY AUDITS VALUE ADDED TAXATION (VAT) TRANSFER PRICING PERSONAL INCOME TAXATION -- cross-border employment -- international secondments -- Hungarian employment of foreigners -- tax and social security administration -- employee benefit packages -- motivation systems -- self-employment -- special share programs CORPORATE INCOME TAXATION TAX ADVISORY SERVICES IN SPECIAL ENTERPRISE CONSTELLATIONS: E.G. TRANSFORMATION (M&A), LIQUIDATION PROCEDURES TAX AND FINANCIAL DUE DILIGENCE OTHER TAXES: ENVIRONMENTAL PROTECTION PRODUCT FEE (GREEN TAX), PUBLIC HEALTH PRODUCT TAX, LOCAL BUSINESS TAX WHERE I PAY TAX, THERE IS MY HOME At the age of globalizing business life there is an increasing need for specialized advices on the taxation of "world citizens". An extremely exciting example from our practice may be an executive officer who has citizenship of three countries while he lives in a fourth state with his family. He performed work relating to the executive management of the Hungarian company in Hungary and in Austria in the frame of a secondment ordered by the Austrian company. The tax expert team of LeitnerLeitner managed to coordinate the regulations of more countries and removed all tax issues from his shoulders. We undertake for example, to report our Clients in similar situation at the tax authority, prepare the tax advance payment calculations and payroll as well as to treat the special benefits, bonuses, stock grants and options for our Clients. At the end of the year we prepare the tax return and take care about the documents necessary for the social security exemption. We harmonize the Hungarian and the foreign tax obligations. Accounting, payroll Auditing and relating services

FORESIGHT MAKES ITS BENEFIT Companies which have developed their production capacity with the help of tax allowances may use the allowances randomly or with careful planning as well. There are many factors to be taken into account to receive the highest benefit from the allowances. For example, we have to count with the losses accumulated until the investment turns into profitable, the present value of allowances, the planned and actual figures of the production as well as further tax base modifying items. The investments of international companies are even more complicated. For example, the Austrian law allows the parent company to use the losses of its Hungarian subsidiary until the production turns into profitable (i.e. the parent company could reduce its payable taxes). However, this amount should be returned when the subsidiary uses its own losses. As a result of a well-planned schedule, millions of euros could be saved. In such situations LeitnerLeitner can help you with calculations on tax optimization. Now this shall be especially emphasized when the investments started before 2009 become profitable and the companies could achieve significant extra savings until the year of using up the tax allowances. In additional, we undertake to prepare your company for the tax authority audits compulsory in case of the tax allowances and we support you in the process of receiving new allowances. Tax advisory services REPRESENTATION IN TAX AUTHORITY AUDITS VALUE ADDED TAXATION (VAT) TRANSFER PRICING PERSONAL INCOME TAXATION CORPORATE INCOME TAXATION -- solutions for tax optimization -- tax allowances - investment tax allowances - incentives for research and development - support of popular team sport - allowances regarding to performance - allowances regarding to film production - royalty allowances -- preparation of tax calculations -- transformation -- company restructuring, acquisitions (M&A) -- review of tax returns TAX ADVISORY SERVICES IN SPECIAL ENTERPRISE CONSTELLATIONS: E.G. TRANSFORMATION (M&A), LIQUIDATION PROCEDURES TAX AND FINANCIAL DUE DILIGENCE OTHER TAXES: ENVIRONMENTAL PROTECTION PRODUCT FEE (GREEN TAX), PUBLIC HEALTH PRODUCT TAX, LOCAL BUSINESS TAX Accounting, payroll Auditing and relating services

Tax advisory services Accounting, payroll COMPREHENSIVE ACCOUNTING INTEGRATED SAP ACCOUNTING ACCOUNTING ACCORDING TO IFRS PAYROLL EMPLOYMENT AND LABOUR ADVISORY AND ADMINISTRATION REVIEW OF ACCOUNTING: SSC, INTERN ACCOUNTING ACCOUNTING POLICIES, REGULATIONS ISSUE OF INVOICES ON BEHALF OF THE CLIENT ACCOUNTING ADVISORY ACCOUNTING TRAINING HOLISTIC APPROACH WAY TO THE BEST SOLUTION A good accountant is accurate, reliable, but their work does not end with recording bills and preparing tax returns and annual reports. LeitnerLeitner provides complex solutions owing to the close cooperation between its business lines: accountants, tax advisors, lawyers and auditors. Our multilingual colleagues have wide experience not only in the field of national rules but in the international accounting systems (US GAAP, IFRS) as well. Our accountants see beyond their daily tasks and in addition to explore the problems they point out the possible solutions as well. We kindly support you and even your auditor as well with accounting advisory. Auditing and relating services

TAKING ADVANTAGES FROM THE OBLIGATIONS Tax advisory services Compulsory legal regulations, administrative burden, extra costs and control. Would only that be an audit? We believe that a good audit is rather like an advice: it helps in the rationalization of business processes, identifying risks and revealing of unexploited opportunities. We can see the great need for this as in many cases companies do not realize the opportunities offered by the Accounting Act. For example, sometimes they cannot find the proper handling of losses due to the higher exchange rate of foreign currency based loans. At the year-end closing, the total amount of foreign currency based loans calculated with the current exchange rate should be recognized amongst expenses, which reduces the capital. Therefore, the rising exchange rates are triggering further and further capital injections or forcing transformation. How could these unfavourable consequences be avoided? The auditors of LeitnerLeitner are always looking for flexible solutions with respect to the given economic situation. For example in a situation like above they suggest to use the so-called "A-C cup", which can change the foreign exchange loss to provision which exempts the capital from the unrealized foreign exchange rate movements. Accounting, payroll Auditing and relating services REVIEW OF ANNUAL REPORTS IFRS, US GAAP CONSOLIDATION OFF-LINE TARGET INVESTIGATIONS TRANSFORMATION AUDIT VOLUNTARY LIQUIDATION FINANCIAL DUE DILIGENCE ACCOUNTING AND FINANCIAL RESTRUCTURING REORGANIZATIONS INTERNAL AUDITS OPTIMIZATION OF BUSINESS PROCESSES INTRODUCTION OF ERP SOFTWARE

International cooperating partners, network members LeitnerLeitner maintains a close and personal relationship with many respected and reputable consulting firms from all over the world. This allows to us to support our Clients with high efficiency in their complex cases involving more countries. Praxity LeitnerLeitner is member of the Praxity group which is a global network of independent companies. Kerschbaum Partner The success of our work is ensured by the long-term partnership with recognized law firms. In Austria, we cooperate with the KPRA office. Flick Gocke Schaumburg LeitnerLeitner have been closely cooperating with the FGS office for years, therefore we also have a reliable partner in Germany in the most important destination country of the Hungarian industry as well. Vorlickova Partners We have been working together effectively with Vorlickova Partners since 1994. The company is one of the leading tax advisory and auditing companies in the Czech Republic. Stalfort Legal. Tax. Audit. Stalfort Legal. Tax. Audit. is our exclusive co-operational partner in Romania. The company was founded in 1997 and they are available for us with their 30 experts in any area of the economic and tax law and in audit solutions in Bucharest, Sibiu and Bistrita. Tascheva & Partner Owing to the cooperation agreement signed in 2013 with Tascheva & Partner, the services of LeitnerLeitner became available in another EU-member state as well. Tascheva & Partner was founded in 1990 and is now one of the leading legal and tax advisory companies in Bulgaria with its 25 employees. MDDP Further to a long time successful cooperation and numerous common projects, in 2014 MDDP the biggest Polish independent advisory firm joined the LeitnerLeitner network. We count on their outstanding professionalism and market knowledge in taxation matters such as legal and business-financial-accounting issues.

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