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Taxes – Hungary

Updated : 24/02/2014

Income taxes abroad

What's your situation?

I'm self-employed

Which income will be taxed in Hungary?

  • Live in Hungary? You must pay tax on your worldwide income there.
    Criteria are: family place of residence, property ownership and whether you spend over 183 days per year in the country.

    You must register as a Hungarian taxpayer and request a tax identification number, after which your tax authority will issue you a tax card. Your tax authority is the one responsible for your permanent or temporary place of residence, or the location where you usually stay.

  • Lived in Hungary but less than 183 days in the tax year? You are not considered as a tax resident. You pay tax only on the income you earned in Hungary.

  • Income from other EU countries? Check you never pay tax twice on the same income.

How much will you pay?

Individuals pay a flat rate of 16%. The authorities distinguish between 2 types of income:

1. Income to be consolidated: income from activities other than self-employment, income from self-employment and other income to be consolidated.

2. Income taxed separately: e.g. in-kind benefits, capital gains, income from private businesses and income from rental properties.

As a rule, income from self-employment activities is calculated as the difference between your total revenues and total costs. You may also choose to apply a flat 10% cost rate, rather than documenting your actual costs incurred.

Take into account any:

  • tax allowances (available to all taxpayers, but the amount depends on your personal situation)
  • deductions you are entitled to for certain types of expenditure.

Deductible expenses include:

  • some forms of government support for raising minors
  • scholarships paid by non-residents to students studying in a foreign educational institution or researchers working abroad
  • some forms of support related to the purchase of property
  • services from insurance companies.

When and how do you pay?

Depending on your professional activity, you must make an advance income-tax payment each month or each quarter.

You must also file your annual tax return by 25 February in the year following the tax year.

How to appeal / complain

If you disagree with your tax assessment, you can appeal to the Tax and Financial Control Administration. .

Read your tax assessment letter carefully to find out exactly which department you should send your appeal to and which procedures you need to follow.

Links

Hungarian government - income tax info magyar

Guide to taxation in Hungary

Tax laws - EU and individual countries

Check also what your EU rights are.


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