With a population of more than 9 million people, Hungary offers a wide range of opportunities for companies looking to expand. Food processing, pharmaceuticals, motor vehicles, and tourism are some of the largest sectors of the economy. Hungary offers several types of company formations depending on your business needs, which must be registered with the National Tax Authorities, Social Insurance Institute, and the Court of Firms before beginning operations.

Payroll and Tax Considerations

  • Employment contracts must be in writing and provided within 15 days from employee start date
  • There are 2 types of minimum wage: National minimum wage for employees without an official profession or unskilled workers and the Guaranteed minimum wage for professional workers in jobs requiring a secondary level of education
  • The minimum wage ranges from HUF 926 – 1211 per hour and HUF 161,000-210,600 per month
  • Overtime pay must be ordered in writing. A maximum of 250 hours can be granted in a calendar year
  • Overtime pay is set at 50% of the base wage for regular overtime and 100% for overtime worked on a holiday
  • Personal income is taxed at a flat rate of 15%

HR and Statutory Requirements

  • Employees receive 20 days of paid annual leave. Extra vacation time amount depends on employee age and number of children
  • Females receive 24 weeks of maternity leave, 4 weeks prior to childbirth and 20 weeks after
  • Fathers are entitled to 5 extra days of vacation time for paternity leave. It must be used by the end of the child’s 2nd month of birth
  • Statutory pension insurance is a 2 pillar pension system based on the compulsory social insurance system and the voluntary savings
  • Employees contribute 10% of monthly earnings and the employer pays 19.5% of gross monthly payroll

Holidays in Hungary

  • January 1 – New Year’s Day
  • March 15 – 1848 Revolution Memorial Day
  • April 15 – Good Friday
  • April 17 – Easter Sunday
  • April 18 – Easter Monday
  • May 1 – Labor Day / May Day
  • June 6 – Whit Monday
  • August 20 – Hungary National Day
  • October 23 – 1956 Revolution Memorial Day
  • November 1 – All Saints’ Day
  • December 25 – Christmas Day
  • December 26 – Second Day of Christmas

If you are just getting started in Hungary, or would like to simplify payroll operations, Blue Marble can help. We have a cloud-based payroll platform with customized monthly reporting to provide real-time access to your payroll across all countries and currencies. Our dedicated US-based service team and in-country experts are here to help when questions come up. Easily manage payroll and compliance in Hungary with Blue Marble. Click here to get started