From 1 January 2013 new taxes have been introduced in Hungary according to the Act CXLVII. On 2012 regarding the tax of small enterprises (“KATA”) and small companies (“KIVA”). We have chosen 7 interesting questions and answers in order to simplify the decision who would like to choose the tax of small enterprises.
1. How the pension liability is calculated?
- An income of HUF 81.300 /month can be taken into account as income subject to future pension contribution, which is lower than the monthly minimal wage of HUF 98.000. This means that the future pension contribution should be taken into account on proportional basis. The activity 100% can be qualified as an employment enable for future pension contribution.
2. What taxes are replaced by the “KA?
- The new tax can be applied instead of personal income tax, dividend tax, corporate income tax, social security tax, health contribution and training contribution. The tax does not replace the value added tax (expect the entities which are exempted of VAT).
3. What is the amount of the tax?
- The amount of the tax is HUF 50.000/month if the individual has no other employment relationship and HUF 25.000/month if the individual is a pensioner or has other employment relationship.
4. What are the invoicing requirements?
- The fact that the company/entrepreneur is a small tax payer should be indicated on the invoice issued by such entity.
5. If the individual is working as a small entrepreneur will be subject to social contribution?
- Only if the individual does not have other employment relationship.
6. Is there an income limit for this new tax?
- No, however if the income arrange the limit of HUF 6 million on annual basis the proportional amount will be subject to 40% surplus tax.
7. Which entities can choose this new tax?
- Partnership (“Bt”) and common partnership (“KKT”) only with private individual members and private entrepreneurs/private entities.
