There is a lot of information you must indicate on the invoices you issue on behalf of your Hungarian company, so there is a chance you might get something wrong from time to time. Since accountancy and bookkeeping is strictly regulated in Hungary, there are also strict rules governing how to correct possible mistakes.

There are two methods for correcting mistakes on invoices:

1. Create a correction invoice

To correct wrong data on a previous invoice or add data that were missing, you can create a correction invoice. The correction invoice will include a reference to the original invoice as well as the new or corrected data. The two documents will be valid together, so you have to give both to your customer.

2. Cancel the invoice and make a new one

When you cancel an invoice, a new document is created: a cancellation invoice. Then you can issue a new invoice, now with the correct data. The new invoice will be valid on its own.

When to cancel and when to correct?

Usually you cancel an invoice when there is a problem around delivery. In some cases, you can simply cancel the invoice by creating a cancellation invoice, and there will be no need for a new invoice.

You can typically create a cancellation invoice when

• You agree on a deal, issue an invoice, but the customer never pays and you never deliver
• You take back a product on warranty
• Issuing the invoice was a mistake, as there was no transaction behind it

However, you can cancel an invoice if any of the data on it were incorrect or missing, and create a new invoice with the right data. In that case always keep in mind what you have already given or sent to your customer.

• If your customer has not yet received an invoice from you, you can simply send them the new, corrected invoice, which is valid on its own.
• If your customer has already received the incorrect invoice, make sure to send them both the cancellation invoice and the new one so they can more easily correct the data in their own accounting system by registering the three documents together.

If the delivery happened, it is usually better to correct the invoice by creating a correction invoice. Then the two documents (the original invoice and the correction invoice) will be valid together, so make sure your customer receives both.

Never delete an incorrect invoice

Since you, your accountant, and the tax authority can track what is happening at your Hungarian company based on your invoices, each invoice has a unique ID, and each invoice must be backed by an actual transaction, recorded either in your bank account or in your cash register. Since the IDs are numbered continuously, deleting an invoice will create a gap in that order, which will later raise doubts about what actually happened there. The transparent solution is creating a cancellation or a correction invoice, as described above.

If you use invoicing software, the program will probably not even allow deleting an invoice. If you are still using an invoice booklet, the invoice templates are numbered by the factory, so you will not be able to create a new invoice with the same number anyway.

Never just “correct” an incorrect invoice

The data on the invoice should match the data in the invoicing software and the data reported to the tax authority. Accordingly, do not simply edit data in the PDF version and print it again, or write the corrected data on the original hard copy.

You can either “cancel” or “correct” an incorrect invoice. In both cases, new documents will be created that will let you track transactions and administrative work.

Still not sure what to do with an incorrect invoice?

You can always ask your accountant whether it makes more sense to cancel or correct an invoice. Just make sure whatever you do remains transparent for the benefit of everyone involved, including you, your accountant, the Hungarian tax authority – and your customer.