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Payroll and Benefits Guide Hungary

Last updated: May 09, 2023

Currency
Forint (HUF)
Employer Taxes
Unknown
Payroll Frequency
Monthly
Employee Costs
18.5%
Capital
Budapest
Date Format
yyyy.mm.dd.
Fiscal Year
1 January - 31 December
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Contribution

Employer Employer Payroll Contributions
13.00%
Social Contribution Tax
13.00% Total Employment Cost

 

Employee Employee Payroll Contributions
7.00%
Health Care Contribution
10.00%
Pension Fund
1.50%
Unemployment Fund
18.50%
Total Employee Cost

 

Employee Income Tax
15.00%
Flat rate

*employees under the age of 25 are entitled to a reduction to the taxable amount based on income included in the consolidated tax base. The maximum monthly amount of the discount in 2023 is 499,952.00 HUF.

Employer taxes

Highest
Lowest

Employee taxes

Highest
Lowest

Minimum Wage

General

The monthly minimum wage is 266,800 HUF for unskilled labour and 326,000 HUF for skilled labour (jobs requiring secondary education or professional qualifications). Minimum wages may also be set within Collective Bargaining Agreements.

MINIMUM WAGE (PER MONTH)

Highest
Lowest

Payroll

Payroll Cycle

In Hungary, the payroll frequency is monthly. Work between the first and last day of the month is typically paid on the last day of the month but must be paid for by the 10th of the following month.

13th Salary

In Hungary, a 13th-month salary is not mandatory. However, an employer can pay bonuses at the employer’s discretion.

Working Hours

General

The standard working week in Hungary consists of 40 hours per week, typically 8 hours per day for a five-day working week.

Overtime

All work above the standard working hours is paid as overtime and regulated by employment contracts/collective agreements. When an employee is requested to work overtime or work on holidays, there is a limit of 72 hours a week. There are also different maximum working hours for minors.
Overtime hours of more than 40 hours a week are paid at 150.00% of the employee’s basic salary rate. Overtime hours worked on weekends and public holidays are paid at 200.00% of the employee’s basic salary rate.

Leave

Annual Leave (vacation)

All employees are entitled to a paid vacation of 20 days every year, which increases according to the employee’s age to a maximum of 30 days for employees over 45 years of age.
In addition, employees with children under 16 years of age are entitled to extra vacation time as follows:

  • Two working days for one child
  • Four working days for two children
  • Seven working days for three children

In case the child is with disabilities, extra vacation days must be increased by two working days.
Both parents may request this extra vacation time.
Upon the birth of his child, a father shall be entitled to five extra vacation days, or seven days in the case of twins, until the end of the second month from the date of birth.

Public Holidays

Public holidays that fall on the weekend are usually lost.

Date Day Holiday Notes
1 Jan 2024 Monday New Year’s Day
15 Mar 2024 Friday Revolution Day
29 Mar 2024 Friday Good Friday
1 Apr 2024 Monday Easter Monday
1 May 2024 Wednesday Labour Day
20 May 2024 Monday Whit Monday
20 Aug 2024 Tuesday Saint Stephen’s Day
23 Oct 2024 Wednesday Republic Day
1 Nov 2024 Friday All Saints’ Day
25 Dec 2024 Wednesday Christmas Day
26 Dec 2024 Thursday 2nd Day of Christmas

Sick Days

Employees are entitled to 15 days of paid sick leave paid by the employer. They receive 70.00% of their salary rate based on the average salary across the previous six months.
Should the sickness continue past the 15th day, the employee is entitled to further time off up to one year (or in the event of a work accident for an unlimited period). The sick payment is paid at a rate of one-third of the payment made by the employer and two-thirds paid by the National Health Insurance Fund.

Maternity Leave

Women have 24 weeks of maternity leave but can take up to three years of leave and receive maternity benefits.
For the first six months, mothers are entitled to Pregnancy and Confinement Benefit (CSED) at a rate of 70.00% of the salary. For the next eighteen months until the child’s second birthday, mothers are entitled to a Child Care Fee (Gyermekgondozási díj – GYED) at a rate of 70.00% of the salary up to a maximum of double the minimum wage.
A benefit called Child Home Care Allowance (Gyermekgondozási segély – GYES) is also available for parents or grandparents taking care of a child up to the age of three. The benefits are paid by the National Health Insurance Fund of Hungary (NEAK).

The family allowance is available to entitled individuals and the rate of the allowance is dependent upon the number of dependents and beneficiary dependents.  This allowance has been increased from 2023 if one of the beneficiary dependents is seriously disabled or permanently ill.

Paternity Leave

A father is entitled to 10 days of paid paternity leave or 12 days for multiple/complicated births taken within the two months following birth.

Parental Leave

Fathers and mothers now individually are entitled to 44 working days of parental leave until a child reaches 3 years of age provided that the employee has at least one continuous year of employment.

Other Leave

There is no other statutory leave in Hungary, however, many companies do allow employees two days’ leave in the event of a death of a family member.

Vacation Days
Public Holidays
Highest
Lowest

PAID MATERNITY LEAVE (DAYS)

Highest
Lowest

Termination

Termination Process

Employers can terminate a fixed-term contract for the following reasons – business, personal, or worker misconduct. It requires notice and a written explanation for the termination.

If the employer terminates an indefinite employment contract by dismissal notice, the employer must provide written reasoning (except for retired employees). The employment relationship can be terminated by the employer, based on only the following reasons:

      • The employee’s behaviour at work (e.g., not fulfilling obligations, being unable to cooperate with colleagues, causing a breach of trust, etc.)
      • the employee’s skills mismatch (e.g., lack of the right abilities, capabilities, knowledge, etc.), with no right to terminate an employee due to temporary incapacity for work
      • Company operations (e.g., reorganization within the company, “quality replacement” with a better qualified employee)
      • The reason for termination must be factual, reasonable, and clear.

The employee needs to be warned if the reason is misconduct, so they have an opportunity to explain their actions. the employer must be able to prove the validity and reality of the reasons for termination.

The employer has the right to terminate the employment contract with immediate effect under specific circumstances:

  • significantly breaches any substantial obligations deriving from the employment contract, willfully or with gross negligence, or
  • behaves in a way that makes the continuance of the employment impossible.
  • The breach of an obligation from the employment relationship must be significant to enable the employer/employee to terminate the employment relationship immediately. However, the significance of the breach correlates not to the amount of the damages occurred but to the degree of the gravity of the breach.

As per the Labour Code, immediate termination can be initiated within 15 days of discovering the grounds for termination or in cases of criminal offences up to the statute of limitations for criminal liability. Failure to adhere to this deadline would render the termination unlawful.

During the probation period, both parties can terminate the employment contract immediately.

Certain employees enjoy protection from termination during specific periods, including:

  • Pregnancy
  • Maternity leave
  • Unpaid child care leave (This protection extends until the child reaches the age of 3, if the employee chooses not to take this leave)
  • Voluntary military service
  • In vitro fertilization process (for a duration of six months)

Upon termination of the employment relationship by notice, the employee should receive the final salary payment no later than the fifth working day after the termination of the employment relationship.

Notice Period

In Hungary, the notice period is 30 days. If the employer terminates the employment, the 30-day notice period must be extended by a set number of days based on the years of service:

  • After three years of service, five additional days’ notice is required
  • After five years of service, 15 additional days’ notice is required
  • After eight years of service, 20 additional days’ notice is required
  • After ten years of service, 25 additional days’ notice is required
  • After fifteen years of service, 30 additional days’ notice is required
  • After eighteen years of service, 40 additional days’ notice is required
  • After twenty years of service, 60 additional days’ notice is required

By agreement of the parties, the notice period may be extended by up to six months. No notice is required whilst on probation.

Severance Pay

Employees are entitled to severance pay after completing 3 years of service. It is required and varies between 1-6 months’ salary depending on the length of service and age of the worker.
Severance is not required when using a fixed-term contract.

Probation Period

The statutory length of probation in Hungary is no more than three months. Should the contracted probation period be less than three months, the parties may extend the duration once, but for no longer than three months in its entirety.

Common Benefits

Individual or season tickets for sports events, holiday gift cards, meals allowance, mobile phone allowance, car allowance/reimbursement.

VISA

VISA

For foreign nationals to enter Hungary to work, they need to apply for one of the following work permits:

  • Individual work permit – For foreign nationals who want to work in Hungary for no more than 90 days.
  • Joint work permit – For foreign nationals who wish to work in Hungary for more than 90 days and within 180 days.
  • Residence permits – Permits residency in Hungary for up to 90 days.
  • Single application procedure – Non-EEA nationals who wish to reside in Hungary for more than 90 days within 180 days. An employee can only apply for this permit type through an employment relationship with a Hungarian employer.

Types of Visas

  • Long Stay Visa (D) – Those who wish to stay in Hungary long-term act as a pre-approved residency permit.
  • Working Schengen Visa – This visa type is used for short-term employment opportunities.
  • Schengen Business Visa – For foreign non-EEA nationals who wish to travel to a Schengen area temporarily. This visa can be used for single or multiple entries. It allows holders to stay for 90 days within six months.
  • Seasonal Employment Visa – foreign nationals who wish to work in agriculture, animal husbandry, or fishing are eligible for this visa. This allows the applicant to work for no more than 180 days.
  • EU Blue Card – a highly-skilled non-EU worker, residing in an EU-member country can apply for this card as long as a residence permit is acquired. The foreign national will need to prove 18 months of lawful stay in a member state to be eligible for this card.

A residence permit is valid for up to 3 years. A work permit is valid for two years, while a visa can be valid for a year.

VAT

General

The standard rate of sales tax in Hungary is 27.00%.

Stay up to date on payroll & employment law changes

Version History

October 25, 2023
Termination process has been updated.
April 10, 2022
The minimum wage in Hungary is now 200,000 HUF for unskilled labor and 260,000 HUF for skilled labor.
Tax brackets have been updated.
July 1, 2020
Employer social security: Social contribution tax dropped to 15.5%
February 1, 2021
Minimum wage: rose to 167,400 HUF (basic amount) and 219 000 HUF when the job requires secondary educational and vocational qualifications.
More

Questions & Answers

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Albert
Albert
2 years ago

I have an employee who’d like to be paid in euros, is this possible? 

Emily Kuhnert
Emily Kuhnert
2 years ago
Reply to  Albert

Hi Albert, thank you for your question. According to the Hungarian Labor Code, wages must be paid in the local currency (Hungarian Forint), so it isn’t possible to pay your employee in euros.

Bharat
Bharat
2 years ago

I have a visa and work permit offered by X company. In this case can i do a part time at restaurants as i also have passion on cooking and i cook well. If yes, what is the maximum part time hours

Emily Kuhnert
Emily Kuhnert
2 years ago
Reply to  Bharat

Hi Bharat, can you please tell me what kind of visa you have and which country you are from?

Bharat
Bharat
2 years ago
Reply to  Emily Kuhnert

Hello,
I have D type Visa and i am from India.

Emily Kuhnert
Emily Kuhnert
2 years ago
Reply to  Bharat

Thank you. Your visa is not tied to your employer, meaning that you are able to work for multiple employers if you so choose. Part-time work is considered to be between 4-6 hours per day.

Bharat
Bharat
2 years ago
Reply to  Emily Kuhnert

Thank you!! This visa processing is actually done by My company, so you mean this is indeed independent?

Thank you again for your detailed responses!!

Ulkar Guliyeva
Ulkar Guliyeva
1 year ago

Hi. I am a third country citizen living in Hungary more than 3 years. I want to get maternity leave 1-2 months before my labor. The company I am working for told me that I wont be eligible for maternity leave benefits from the state in case if the delivery of babies happen in my home country (Azerbaijan) as there should be signatures and stamps of Vedónó on my papers every month regularly and finally birth certificate is supposed to be received from Hungary itself. I couldnt believe the truthfulness of this info,as it should be our right to choose the destination in which we want to give birth. Could you please help me?

Erez Greenberg
Erez Greenberg
1 year ago
Reply to  Ulkar Guliyeva

We recommend you contact the National Health Insurance Agency in Hungary for advice regarding this matter.

Gwon
Gwon
1 year ago

I about to have an interview with A Hungarian company but I am S. Korean.
Can I get paid my salery in euro even though I will be hired by Hungarian corporation? I am not sure about which type of my visa will be.

Erez Greenberg
Erez Greenberg
1 year ago
Reply to  Gwon

Hi, a worker in Hungary must be paid in the local currency.

F Audau
F Audau
1 year ago

Hi, About travel expenses reimbursed by an employer in Hungary, what are the max tax free amounts for a meal reimbursed locally and abroad ? Same for an hotel room locally and abroad ? Thanks for your lights …

Erez Greenberg
Erez Greenberg
1 year ago
Reply to  F Audau

Most expenses are tax-free if they are supported by a valid tax receipt or claim form. In some cases, limits apply to the amount of a per diem that can be paid tax-free but this is subject to many scenarios (eg. location where a worker is based and where they are required to work, time spent in location, length of time receiving the per diem, etc.). This will need to be reviewed on a case by case basis depending on location.

John
John
1 year ago

Hi! I’ve an employee who we want to employ and we set a yearly rate of 50000 EUR. I get it they will have to be paid in local currency (HUF) but can the contract has the EUR amount fixed by month. Or is it possible to have new contract every month so as EUR – HUF exchange rate changes the employee doesn’t get lower salary in EUR?

Erez Greenberg
Erez Greenberg
1 year ago
Reply to  John

Kindly seek legal and contractual advice, this is something that might be agreed upon with the employer, as the exchange rate can be included in the contract.

Ben
Ben
1 year ago

What about White Card visa? does it fit the visas mentioned above?

Erez Greenberg
Erez Greenberg
1 year ago
Reply to  Ben

A white card is a residency permit intended for a third-country national who:
– has a verified employment relationship/owns a share in a company in a country other than Hungary and performs his/her work from Hungary using an advanced digital technology solution.
– meets the general requirements for staying in Hungary for more than 90 days within any 180-day period and does not have any disqualifying conditions
– does not pursue any gainful activity in Hungary and does not hold a share in a Hungarian company

Dev
Dev
1 year ago

Hello, I am an Indian citizen with Permanent Residency in Hungary. When I travel to India, can I claim the home travel expense from the company/ government. Does the Hungarian law permits this? I have been told that as I dont travel to work from my Home(India), I cannot avail this, although my passport mentions permanent address as India. Can someone shed some light on this? If possible direct me to a government policy provided by the government?

Erez Greenberg
Erez Greenberg
1 year ago
Reply to  Dev

Commuting reimbursement is usually applied when traveling from the office to home and back or reimbursement when on a business trip. If someone is traveling abroad for personal reasons this would not be required to be covered by the company (unless the employer relocated the worker to Hungary for the job and advised them at the time that paid travel to India would be included as part of the package).

Mohit
Mohit
9 months ago

hi, I need help. I am the owner of company in Hungary. Opened recently, my accountant is confusing me all the time. He told me that if I want to reimburse petrol or highway ticket for my personal car which I am using for work purpose then have to put it on company’s name but I don’t want to do that as want to buy a new one in a year or so. I asked him why not I just reimburse that cost as I am also employee and in my previous jobs in Hungary I was reimbursing the cost of highway ticket and petrol using govt excel file all the time. When I showed him the excel file then he said yes but for highway ticket he said there is no way…don’t understand why I can’t do it now and did it for last 5 years when I worked for different company and now I am employed in my own company and rule changed …its quite frustrating dealing with my accountant..

Enny Shmurin
Admin
Enny Shmurin
9 months ago
Reply to  Mohit

Hello,

When it comes to tax specifics for employer-owned businesses in Hungary, it would be necessary for the individual to seek advice from a local tax accountant who is well-versed in Hungarian tax regulations and laws.

Izh
Izh
8 months ago

Hi! Could you kindly let me know what are per diem rates for Hungarian employees travelling to Germany? Your help will be greatly appreciated!

Enny Shmurin
Admin
Enny Shmurin
1 month ago
Reply to  Izh

Hello, unfortunately, this is something we are unable to advise on.

Saba
Saba
7 months ago

Hi I would like to know during maternity leave can we stay more than 180days outside the Hungary for foreigners in case we have long permit till next year valid ?

Enny Shmurin
Admin
Enny Shmurin
14 days ago
Reply to  Saba

Given the specific and unique nature of this situation, we recommend that you engage in a discussion with your employer. Additionally, you should reach out to local authorities to thoroughly review your employment status and working conditions of your visa.

Ana Duran
Ana Duran
2 months ago

What is the retirement plan for employees in Hungary?

Enny Shmurin
Admin
Enny Shmurin
2 months ago
Reply to  Ana Duran

If the employee is approaching retirement age, it is advisable to initiate a discussion with their employer initially. Following that, contacting the local authorities, specifically the Government Office of the Capital City of Budapest, is recommended for additional guidance.

Motu
Motu
2 months ago

Hi Team,

How to calculate “Tax exemption” for hungary ? What is the logic for that ?

Enny Shmurin
Admin
Enny Shmurin
28 days ago
Reply to  Motu

The are various different tax exemptions in place e.g. depending on age, number of dependents etc. We recommend seeking local tax advice for your specific personal set up.

emsi
emsi
2 months ago

Hello. I just want to know if what will happen if I got pregnant here in Hungary? We are a foreign worker, We are from Asia. We have a 2 year contract. We are staying at the accomodation provided by our agency here. I just want to know if they can terminate my contract and semd me back from our country if I get pregnant. Thankyou

Enny Shmurin
Admin
Enny Shmurin
28 days ago
Reply to  emsi

Generally it is not permitted to terminate a pregnant worker. In terms of your rights as a foreign worker this is something we recommend checking depending on your specific contract and work permit set up.

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Payroll and Benefits Guide
in Hungary

What’s covered in this guide:

  • Employer/employee contributions
  • Minimum wage
  • Working hours
  • Visa requirements

And more...

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All questions are answered by our in-house compliance department working in conjunction with our local in-country partner for this specific country

Public Holidays Calendar

Hungary
Download:
CSV
PDF
ICS
Date Day Holiday Notes
1 Jan 2024 Monday New Year’s Day
15 Mar 2024 Friday Revolution Day
29 Mar 2024 Friday Good Friday
1 Apr 2024 Monday Easter Monday
1 May 2024 Wednesday Labour Day
20 May 2024 Monday Whit Monday
20 Aug 2024 Tuesday Saint Stephen’s Day
23 Oct 2024 Wednesday Republic Day
1 Nov 2024 Friday All Saints’ Day
25 Dec 2024 Wednesday Christmas Day
26 Dec 2024 Thursday 2nd Day of Christmas