Our infographic 10 Facts about taxation in Hungary sums up the most important information each entrepreneur should know about the Hungarian tax system in 2019. Below you can find the highlights of our latest Tax guideline, prepared by our tax advisory team.
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Standard Corporate Income Tax (CIT): 9%
Company without profit
A company without profit still has to pay corporate income tax on the income minimum as tax base.
No Withholding Tax in B2B relations*
*Royalty, Interest, Dividends; unless the recipient is CFC
Standard VAT rate in Hungary: 27%
- 5% rate applies to some type of milk, poultry meat, fresh eggs, medicine, books, magazines, specific large live animals, district heating services, instrumental live music performed by artists at private events, new residential properties and from 2018 restaurants and internet.
- 18% rate can be applied to dairy products, products made from milk, corn, starch, commercial accommodation services and open-air events’ service providers.
Personal Income Tax
Personal Income Tax in Hungary: 15%
Social contributions owed by the Employee
Social contributions owed by the Employee: 18.50%
Social contributions owed by Companies
Social contributions owed by Companies: 21%
Depending on the local government’s decision, land tax could be calculated in two ways:
- by the land’s area in m2 (max. tax rate is HUF 200 / m2 / annum) decreased by the structure’s space on the land itself
- the adjusted market value of the land (capped at 3%)
- owed regardless of what they are intended or utilized for (both residential and non-residential buildings/structures)
- the owner at January 1st is subject to tax (should there be more owners, tax is paid proportional to their shares)
Depending on the local government’s decision, building tax could be calculated in two ways:
- by the useful space in m2 (max. amount payable is HUF 1,100 / m2 / annum)
- adjusted market value (max. 3.6% of adjusted market value)