Central Europe


9,728,337 (July 2021 est.)


Hungary is among the top tourist destinations in Europe with the capital Budapest regarded as one of the most beautiful cities worldwide. Despite its relatively small size, the country is home to numerous World Heritage Sites, UNESCO Biosphere Reserves, the second largest thermal lake in the world (Lake Hévíz), the largest lake in Central Europe (Lake Balaton), and the largest natural grassland in Europe (Hortobágy).

The legal system in Hungary is based on civil law. Therefore, the main rules governing businesses are codified in statutes and regulations. As a result of a recent legal reform, a limited precedent system has been introduced in Hungary which has been effective since 1 April 2020. Consequently, the courts are obliged to follow the legal interpretation of the Hungarian supreme court (Kúria).

In March 2019, the wealth management foundation regime was introduced into Hungarian law as a new asset protection and estate planning vehicle, as an alternative to using similar foreign structures.

The wealth management foundation is an entity established for the purpose of managing the assets granted to it by its founder and to distribute assets and the proceeds of its wealth management activity to the beneficiaries. The foundation can be established with an initial amounting of at least HUF600 million.
The wealth management foundation can be used for asset protection purposes because the founder’s creditors can only bring a claim over assets managed by the foundation if they were transferred to it by the founder fraudulently, in order to avoid settling his or her debts by diminishing his or her assets. Moreover, the creditors of the beneficiary can only seek to settle their claims from assets managed by the foundation if the foundation’s obligation to transfer assets to the beneficiary is due.

The taxation of a wealth management foundation is modelled on the tax regime applicable to trusts.
The transfer of assets to a wealth management foundation by the founder is, as a general rule, tax-neutral. Therefore, it should not incur any tax obligations.

A wealth management foundation qualifies as a taxpayer for CIT purposes. Consequently, it may rely on the tax benefits available to Hungarian tax-resident entities. The wealth management foundation can be exempt from CIT if the following requirements are met:

  • Its founder is a private individual.
  • It only has private individual beneficiaries.
  • It only realises income from owning or disposing of financial investments, securities, receivables or liquid assets.

Distributions made by a wealth management foundation would, as a general rule, be classified as yield. The distribution of yield would be treated as dividend for PIT purposes and could trigger PIT at 15% at the beneficiary. In addition, a Hungarian tax resident beneficiary could be subject to social tax at 15.5% regarding the yield received by him or her (this liability is capped at about EUR1,700 in 2021). However, if the wealth management foundation only manages assets transferred to it by private individuals, the managed assets must be categorised as capital or yield. The distribution of capital may entail gift tax as if this took place directly between the founder and the beneficiary (for example, no gift tax would be triggered if the beneficiary is the settlor or the spouse or a lineal relative), while the distribution of yield would be taxed as set out above.


Average connection speed (Mbit/s) – 31.7
Broadband average connection speed (Mbit/s)- 193.80
Median 5G connection speed (Mbit/s)- 11.98


For Hungary, there are two associated plug types, types C and F. Hungary operates on a 230V supply voltage and 50Hz.


$32,945 (2019 est.)
$31,485 (2018 est.)
$29, 832 (2017 est.)

note: data are in 2010 dollars


temperate; cold, cloudy, humid winters; warm summers



Your residence permit will be based on the profits generated from your real estate investment. The easiest way to do this is to buy at least 2 apartments in Budapest and rent them for profit. The permit will have to be renewed annually for the first 3 years, after which you can apply for permanent residency.


  • Minimum investment of EUR 200,000 which suffices for buying 2 apartments in Budapest. As the property market in Budapest is growing 15% annually, the profitability of the investment is practically guaranteed.
  • Additionally, you will be required to pay EUR 20,000 for program fees and a 4% property tax after buying the apartments.

Key Benefits

  • As Hungary is a full member of the Schengen zone in Europe, your Hungarian residence permit will allow you and your family to travel visa-free within the whole Schengen area.
  • Once your residence permit based on your real estate investment is granted, your closest family members including your spouse and dependent children can get their permits on the grounds of family unification.

Processing time

2- 3 months


bauxite, coal, natural gas, fertile soils, arable land


Hungarian 85.6%, Romani 3.2%, German 1.9%, other 2.6%, unspecified 14.1% (2011 est.)

Note: percentages add up to more than 100% because respondents were able to identify more than one ethnic group; Romani populations are usually underestimated in official statistics and may represent 5-10% of Hungary’s population.


Hungarian (official) 99.6%, English 16%, German 11.2%, Russian 1.6%, Romanian 1.3%, French 1.2%, other 4.2%

Note – shares sum to more than 100% because some respondents gave more than one answer on the census; Hungarian is the mother tongue of 98.9% of Hungarian speakers (2011 est.)


Roman Catholic 37.2%, Calvinist 11.6%, Lutheran 2.2%, Greek Catholic 1.8%, other 1.9%, none 18.2%, no response 27.2% (2011 est.)


total: 43.6 years
male: 41.5 years
female: 45.5 years (2020 est.)


urban population: 72.2 % of total population (2021)
rate of urbanization: 0.05% annual rate of change (2020-25 est.)
Total population growth rate v. urban population growth rate, 2000-2030


3.41 physicians/1,000 population (2017)


Parliamentary republic


3.45 % (2019 est.)
3.71 % (2018 est.)


Personal Income Tax Rate (highest marginal tax rate) – The PIT rate is 15% of taxable gross income.

Individuals resident in Hungary are subject to PIT at 15% on their worldwide income. In addition to PIT, certain types of income (such as dividends) are subject to social tax at 15.5% (this liability was capped at about EUR1,700 in 2021 for dividends).

To avoid double taxation, the provisions of the relevant double taxation treaty entered into by Hungary should be applied. If such provisions do not stipulate otherwise, tax credit is granted to the individual in accordance with the domestic legislation by allowing for the reduction of the PIT payable by up to 90% of the tax paid on the income abroad, but by no more than the amount of the PIT payable.

Individuals’ resident in Hungary are subject to income tax on their worldwide income, regardless of whether or not the funds were transferred into Hungary.
Section 3 of Act CXVII of 1995 on Personal Income Tax provides that the following individuals will be considered to have residence in Hungary:

  • Hungarian citizens.
  • EEA nationals who spend at least 183 days per calendar year (including the day of entry and the day of exit) in Hungary.
  • Third-country nationals who have a permanent residence permit or stateless status in Hungary.
  • Foreign nationals making investments in Hungary can, under certain circumstances, obtain a residence permit within a few months.

Individuals that do not fall within any of the classes referred to above can still have tax residence in Hungary if their:

  • Only permanent home is in Hungary.
  • Centre of vital interests is in Hungary and either:
  • they have no permanent home in Hungary; or
  • Hungary is not the only country where they have a permanent home.
  • Habitual abode is in the domestic territory of Hungary, their centre of vital interests is unknown and either:
  • they have no permanent home in Hungary; or
  • Hungary is not the only country where they have a permanent home.

When assessing the existence of a “permanent home”, any type of dwelling may be taken into account (for example, a house or apartment owned or rented by the individual, a rented furnished room and so on) in order to establish that an individual has his or her home in Hungary. As an additional condition, the home must be of a permanent nature (that is, the individual must have arranged for the dwelling to be available to him or her on a continuous basis and the individual must actually live there). An individual can prove that he or she has a permanent home in Hungary if at least a rented flat is available to him or her in respect of which he or she pays for utilities and so on.

The Hungarian tax authority’s interpretation of the notion of “vital interest” mostly follows the Organisation for Economic Co-operation and Development (OECD) commentary by considering that the country with which the personal and economic relations of the individual are closer to be the centre of vital interest. Therefore, the individual’s family and social relations, occupation, political, cultural and other activities, place of business, and the place from which he or she administers his or her property should be considered. The circumstances must be examined as a whole, but considerations based on the personal circumstances of the individual (such as close family relatives living in the same household) should receive special attention.

Corporate Income Tax Rate (excluding dividend taxes) – From 1 January 2017, the CIT rate is a flat 9% of the positive CIT base.

Special Tax Regimes- Unilateral foreign tax credit is available for income taxes paid abroad, up to the Hungarian tax payable on the creditable income (at a maximum of 90% of income tax paid abroad). Sections 16(1)(c) and 16(7) of Act LXXXI of 1996 on the Corporate Income Tax and Dividend Tax (Act on CIT) provides that an exit tax will apply to corporate income taxpayers who move their place of management from Hungary to another jurisdiction.

Hungary has an extensive double tax treaty network and has entered into treaties with around 86 countries, including the US and the UK. Many of these treaties are quite favourable because they leave ample room for tax planning (for example, the treaties concluded with the US, Malta and Cyprus among others).

Hungary signed and ratified the OECD Multilateral Convention to Implement Tax Treaty Related Measures to Prevent Base Erosion and Profit Sharing.

Hungary has also entered into double tax treaties concerning inheritance tax with Austria, Poland, Romania and Sweden.

Hungary has implemented the CRS into its domestic law. The first information exchange took place in September 2017. Information exchange has been ongoing ever since, with an ever-wider array of jurisdictions as new countries continue to implement the CRS into their own domestic laws.

Table of Contents: HUNGARY

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