Harmonics and the reactive power related problems in the supply and demand side are increasing with the proliferation of nonlinear loads such as power converters in industrial applications. Filtering options such as passive, active and hybrid filters are countermeasures against these problems. In this study, a novel hybrid active filter topology with a new approach to enhance the system performance is presented. In this study, a novel hybrid active filter topology with a new approach to enhance the system performance is presented. The proposed topology comprised a parallel inverter and a hybrid active filter. It improves the system efficiency and reduces VA ratings, hence, overall filtering cost. The system operation, control and experimental verification on three phase rectifier and/or capacitor loads are presented.