Start the new year by getting up to speed regarding new regulations that may affect your company operation in Hungary. Read on to get a summary, and let us know if you need help with business setup, administration, or accountancy.
2026 changes to taxes
Below you can find a list of tax changes relevant to Hungarian companies. To see a full list of 2026 changes relevant to all types of businesses including freelancers, click here.
The 2026 tax package of Hungary is relevant to ca. 230-240,000 businesses in total, although the main targets are small and micro-businesses. The total tax reduction they can achieve is estimated to be around HUF 80-90 billion. While this can mean a significant relief to business owners, it will not put too big a dent in the government budget, expected above HUF 35,000 billion.
1. VAT exemption increased to 20 million
While most businesses are VAT subjects, microbusinesses and freelancers often opt to remain exempt from VAT. They can only do this if their yearly revenue is under a certain limit, and this limit has just been increased from HUF 18 million to HUF 20 million. Additionally, further increases are promised in 2027 (to HUF 22 million) and 2028 (to HUF 24 million).
2. KIVA eligibility extended
KIVA is the Small Business Tax in Hungary. It can be chosen instead of the regular corporate tax, TAO, and it is most beneficial to businesses that create high value added products and mostly have expenses related to personnel. KIVA has just become available to many more companies with the extension of both entry and maintenance conditions:
- The company may enter KIVA if its balance sheet total and yearly revenue is below HUF 6 billion (instead of the previous HUF 3 billion); the KIVA status may be maintained as long as these figures remain under HUF 12 billion.
- The company may enter KIVA if the number of its employees is below 100 people (instead of the previous 50 people); the KIVA status may be maintained as long as the number of employees remains under 200 people.
Want to see if KIVA or TAO works better for your company? Visit our calculator now.
3. New green corporate tax benefit
Is your company planning investment into clean or green projects, or maybe any projects remedying environmental damage? If the investment is above HUF 100 million, you may reduce your corporate tax base by 70-100% of the investment, depending on the type of work being performed. The total worth of the benefit may be up to EUR 30 million.
4. Retail tax tier limits increased
Retail tax remains the same in 2026, but the tier limits are raised. The change will in fact be applicable for the year 2025 already.
Tax rate | OLD tiers | NEW tiers |
0% | Below HUF 500 million | Below HUF 1 billion |
0.15% | HUF 500 million – HUF 30 billion | HUF 1 – 50 billion |
1% | HUF 30 – 100 billion | HUF 50 – 150 billion |
4.5% | Above HUF 100 billion | Above HUF 150 billion |
5. Excise duties remain the same
In line with the tax changes announced earlier, excise duty for fuels was supposed to increase as of January 1, 2026, meaning a HUF 8-9 / liter increase in the price of fuels. Instead, this is now postponed to July 1, 2026. This will be relevant to every industry that relies on the transportation of goods at any point of its supply chain.
6. Corporate tax advance payments reduced
Corporate tax advance payments depend on the results of the previous year. If the corporate tax paid for the previous year is above a limit, you will need to make reports and advance payments monthly (otherwise only quarterly). This limit has just been raised from HUF 5 to HUF 20 million, reducing administrative burdens on 10-15 thousand TAO subjects.
7. Simplified reports available to more businesses
Microbusinesses are allowed to file simplified reports as long as their revenues remain under certain thresholds. These thresholds are now increased:
- Yearly balance sheet total: from HUF 150 million to HUF 180 million
- Yearly net revenues: from HUF 300 million to HUF 360 million
8. Unburdening companies under liquidation
If a company received shareholder loan throughout its operation, the loan should be waived upon liquidation. This is considered a gift, and as such, it is taxed at 18%. Starting from January 1, 2026, however, companies under liquidation are no longer subject to this gift tax.
2026 changes to personnel related costs
If you take dividends, have employees, and have HR related workflows in place at your Hungarian company, you should keep in mind the following changes. This is just a summary, you can find a more detailed description of HR and payroll related changes here.
A. Minimum wage increased again
In Hungary, the minimum wage is raised every year so it can remain a living wage. Starting from 1 January 2026, the minimum wage is increased to HUF 322,800, while the guaranteed minimum salary is increased to HUF 373,200. This has the following effects:
- The cap on social contribution tax is increased – relevant if you take dividends
- If you have employees on minimum wage, their wages should be adjusted
- Employees who have higher wages will also expect a raise
- If you raise wages, labor contracts should be updated too
B. Improved tax benefits for families
If you have employees who are raising children, their net salaries may increase without additional costs to your Hungarian company. This is thanks to improvements to two tax benefits:
- Family tax benefit: The tax base of parents is significantly decreased depending on the number of children, adding HUF 20,000, HUF 80,000, or HUF 198,000 to the net salary.
- Tax exemption for mothers: Mothers of 3 or 4 children do not pay personal income tax in Hungary. Starting from January 1, 2026, this is extended to mothers under 40 with 2 children, and mothers under 30 with at least 1 child.
C. Reduced HR administration
The pink social security booklet has become redundant over the years thanks to the digitalization of most government services. As a result, it is abolished as of January 1, 2026. Employers are expected to hand over booklets to employees now or with the exit documents when the employment is terminated. Read more here.
D. Changes to fringe benefits
The SZÉP Card, which is the most popular fringe benefit in Hungary, is currently available not only for hot meals, holiday accommodation, and recreational activities, but also for grocery shopping – between December 1, 2025, and April 30, 2026.
At the same time, the SZÉP Card is no longer available for home improvements. This option was made available only for 2025, but it is now discontinued.
Company setup and operation with Helpers
Helpers offers administrative assistance with business setup and operation. Our services include company registration, registered seat, mail forwarding, accountancy, HR compliance, payroll administration, and many more.
Let us take the burden of administrative tasks off your shoulders, so you can focus on what you do best: building your company.
Did you like this article? Follow us on Facebook and never miss an update.