Are you operating a company in Hungary? Then get ready for 2020, and learn about the changes to regulations that might be relevant to your operation.
As of 1 January 2020, the VAT rate for commercial accommodation services is reduced from 18% to 5%. This is relevant to you if your Hungarian company lists real estate management as one of its activities. If you received Hungarian residency though real estate investment, consult your accountant how this will influence your rental prices.
Read more about VAT rates in Hungary here.
KIVA, the small business tax is decreased to 12% as of 1 January 2020. Moreover, the yearly revenue limit way also raised to HUF 1 billion (ca. EUR 3 million. )You might already know that KIVA is a Hungarian tax construction chosen by companies with less than 50 employees and a yearly revenue below a certain limit (the one now raised). It benefits SMEs in the service industry, where most expenses are generated by personnel (salaries), not by the purchase of goods.
Read more about KIVA here.
In 2020, employers’ payroll taxes stay the same at 19% (social contribution tax 17.5%, vocational training tax 1.5%). The employees’ taxes also stay the same at 33.5% (15% income tax, 10% pension contribution, 8.5% health insurance contribution and labor market contribution).
However, both the minimum wage and the guaranteed minimum salary are raised by about 8%. As of 1 January 2020, the minimum wage relevant for unskilled jobs is gross HUF 161,000 (ca. EUR 490), and the guaranteed minimum salary relevant for jobs that need at least secondary education is gross HUF 210,600 (ca. EUR 640) per month.
Read more about the raise of minimum wages here.
Check out our salary calculator here.
Some further measures have just been announced to alleviate the burdens of a broader segment of the population, and counter the impact of the current COVID-19 pandemic on Hungarian economy.Read More
The Hungarian government introduced the following economic relief measures to alleviate the burdens posed by the current COVID-19 pandemic, and make sure it is easier for everyone to get through these difficult times and pick up work once the situation clears up:Read More