Tax returns season coming up in Hungary

Tax returns season is starting soon in Hungary. Drafts created by the Tax Authority become available next week, and the deadline for submission is 21 May 2024. But how does that work in Hungary? Read on to find out!

Tax returns in a nutshell

If you have income in Hungary, you are most probably a tax resident, and this means that you must submit some paperwork related to this every year. For most people, the fiscal year is the same as the calendar year, from 1 January to 31 December. Once this period ends, you are required to submit paperwork detailing your income to the Tax Authority.

These days most of administration related to payroll and accounting is done online, with a direct link to the database of the Tax Authority. As a result, the Tax Authority can prepare a draft for your tax returns, and you only have to review it to see if every piece of data is indicated correctly.

You can review your draft online if you have access to Ügyfélkapu, which is the Hungarian system for electronic administration (also called the “Client Gate”). The tax returns draft will be available after 15 March at a website created specifically for this purpose at https://eszja.nav.gov.hu/.

If you do not have access to Ügyfélkapu (and you do not want to create a login now), you can also receive a physical copy of your tax returns in the mail. You can submit a request for this on phone, in a text message (SMS), or in a postal letter. You can read about these options here. The deadline for submitting a request is 18 March. In this case, you are supposed to receive your package by 30 April.

Personal income tax and tax returns

If you have income in Hungary, there is a chance that you are either an employee or a person running a business.

• If you receive salary as an employee, your salary is supposed to be a net salary, to which both taxes and tax benefits have already applied by your employer.
• If you are a businessperson, you probably have an accountant that reminds you to pay your personal income tax every month, or every time you take a dividend advance

As a result, by the time tax returns season comes, there is a chance you have already paid all your taxes and have received your employment related benefits, so in most cases there is very little to adjust or reclaim.

Most frequent reasons for a reclaim:

• There was a change to your marital or health status that was not considered when calculating your tax benefits during the year (e.g. you forgot to tell your employer)
• You are a member at a private pension or healthcare fund, in which case you can reclaim a portion of the sums you paid them

Review and submit your tax returns forms

The draft for the tax returns form becomes available online after 15 March 2024 – if you have Ügyfélkapu access, you will receive an email alert in your inbox. If you have a sum to reclaim, it makes sense to submit the form as soon as possible, so you can receive your tax returns sooner. Otherwise the deadline is 20 May every year. In 2024, the deadline is 21 May, because 20 May is a holiday (Pentecost).

Unfortunately, the interface is not available English. However, these days online tools can help you understand what each section is about, and you only have to deal with sections indicated on the documents you received from your employer, your accountant, and your pension or healthcare funds. If you have anything to reclaim, you will have to find the option to indicate the bank account number where you want the sums returned to.

When you are ready, just hit submit, and you are done! You should receive an email confirmation, and it makes sense to save the document for yourself in a PDF format.

What is the 1+1% form next to my tax returns?

In Hungary, when you submit your tax returns, you have the chance to donate a fraction of your personal income tax to a good cause. This is a donation that does not cost you any money: you will in fact just redirect 1% of the personal income tax you have already paid to a cause of your choice.

For this purpose, you can choose two organizations: a church and a non-governmental organization. 1% will go to a church, and another 1% to an NGO. As a result, you will see more and more advertisements around town asking for your 1% starting from March. If you need some inspiration, check out some organizations we at Helpers supported at our last charity drive.

This is a great chance to support a good cause of your choice without actually spending money on it. While 1% does not seem much, the donations add up, and you can really make an impact alongside all the other donors. If you do not offer your 1+1%, it will be used by the government as they see fit, like the rest of your personal income tax.

Helpers is at your service

We at Helpers do our best to make life easier for everyone living, working, or doing business in Hungary. We hope our guides can help you navigate Hungarian bureaucracy. Moreover, if you need help with issues related to business setup or residency application, we would be happy to be by your side along the way.

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