ARC – Tax & Social Security Services
Taxation of foreign assignees in Hungary
Non-EU assignees are not necessarily taxable in Hungary if their job here is not exceeding 183 days in a year and they are not payroll-transferred to Hungary. They will become Hungarian taxpayers though if, they are payroll-transferred for the term of their Hungarian assignment or, they spend more than 183 days in a year in Hungary.
EU assignees are taxable in Hungary on any income received in Hungary. They will become fully Hungarian taxpayers if they are payroll-transferred to Hungary or, the “centre of their vital interests” is in Hungary (e.g. their permanent address and their family are in Hungary).
The Hungarian Social Security Scheme
All employees in Hungary must join the Social Security Scheme. That system is including the pension and the healthcare coverage of all Hungarian workers. Contributions, determined as a percentage of the salary, are deducted by the employer and paid directly to the SS Scheme, as well as employers also have a mandatory contribution payable to the SS Scheme on all employees they have.
Anyone having no employment in Hungary can join the system and pay contributions on an individual contract.
Non-EU citizens will be part of the national healthcare system in Hungary if they are payroll-transferred to this country. If they are not payroll transferred they are still supposed to have an international healthcare insurance providing coverage for a minimum of EUR 30 000.00 (in words Thirty Thousand Euros). Any non-EU transferee remaining on the home payroll will also be registered in the Hungarian SS Scheme, and pay contributions, if his/her assignment is extended after two years of work in Hungary.
EU citizens will be fully insured in Hungary if they are payroll-transferred to Hungary, however, they will be entitled to use the Hungarian healthcare system if they are covered by the national health insurance of another EU country. Based on the regulations of the European Union, EU nationals are entitled to get a pension on all employments, and contributions paid in any European country, during their career.