We would like to present to you the most important Hungarian Law amendments affecting the Personal Income Tax and the Social contribution Tax, relevant for 2025.
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PERSONAL INCOME TAX
Tax base benefits
The family tax allowance will increase in two stages.
Monthly amount of family allowances:
As of
now the monthly amount of family allowances is 10.000 HUF for one, 20.000 HUF
for two and 33.000 HUF for three or more dependants. As from the 1st
of January 2025 this will increase to 15.000 HUF for one, 30.000 HUF for two,
and 49.500 HUF for three or more dependents. As from the 1st of
January 2026 this will increase to 20.000 HUF for one, 40.000 HUF for two and
66.000 HUF for three or more dependants.
The Excess in case of long-term ill, severely
handicapped dependents is now 10.000 HUF, as from the 1st of January
2025 15.000 HUF and as from the 1st of January 2026 20.000 HUF.
Fringe benefits
The annual budget of the SZÉP card benefit will increase from yearly HUF 450,000 (approx. EUR 1,100) to yearly HUF 570,000 (approx. EUR 1,400), and from January 1, 2025, the "Active Hungarians" pocket will be established to be available for leisure activities up to HUF 10,000 per month. Benefits can also be used for home development purposes in 2025 under certain conditions. From January 1, 2025, a housing allowance up to HUF 1.8 million (approx. EUR 4,400) may be provided as fringe benefit to employees under the age of 35, to be available for financing rent or repayment of housing loans.
Tax-free benefits, revenues
The adopted tax package broadens the scope of
tax-free income:
- student loan debt forgiven and early repayment of loans in connection with having children
- utilization of voluntary mutual pension savings for housing in 2025
- ensuring the use of sporting facilities and equipment maintained by the paying agent
- tickets to major sport and national events as representation or business gifts
- allowances from sport bodies for the preparation or competition
- zoo tickets and passes per tax year up to the minimum wage
- from the sale of a listed historical building with conditions beyond 3 years after acquisition
- income from energy savings retroactive to 1 January 2024
- amounts received as compensation, damages, grievance fees, pecuniary satisfaction, except income replacement and out-of-court settlement.
Interest income
If a Hungarian person obtains special interest
type income from a non-treaty state, the tax paid abroad may be
credited, and if a citizen of a non-treaty state receives similar income
from a Hungarian paying agent, this may be taxed in Hungary.
From 2025, private individuals will be tax-free to contribute intellectual property to their business.
Family catering | Changes to the Airbnb market
From January 1, 2025, the advantageous itemised flat-rate taxation may only be opted for a maximum of 3 properties. The annual rate of itemized flat-rate tax will also be increased and will amount to HUF 150,000 per residential room in settlements where the number of guest nights exceeded 2 million in the second year preceding the reference year.
Deposits in long-term investment accounts (so-called: “TBSZ” in Hungarian)
In the event of early hacking of an investment placed in a long-term investment account, an uncapped social contribution tax is payable on the commitment yield if the commitment period is less than 5 years. 13% within 3 years, 8% between 3-5 years.
Allowance for labour market entrants
In the case of
legal relations established in 2025, the social contribution tax base may only
be reduced up to the minimum wage for 1 year instead of the former 2 years.
Latter only by 50% of the previous discount in the next 6 months.
Vocational education and dual training
For trainings
starting after December 31, 2024, the employer may claim the discount for
participants in vocational education or dual training for up to 1 year per
person, if the student studies there and successfully takes a vocational exam
within the next 2 examination periods after the completion of the training.
