Payroll and HR in Hungary
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Let IRIS FMP help simplify Hungarian payroll and HR. As a trusted global payroll and HR expert, operating 88 in-country teams, we have the local knowledge to ensure your overseas employees are paid on time, every time.
Navigating payroll and HR in Hungary is no easy feat if you are unfamiliar with the local laws and legislation. As compliance is always a top priority for businesses throughout a global expansion, you will need a specialist to guide you. With differing laws, cultures and regulations, you can become overwhelmed. Fortunately, our expert teams are here to help. We offer:
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Payroll in Hungary
We help you overcome the complexities of international payroll and manage everything for you – from local pay to benefits. Your growing workforce will be paid accurately, on-time, every time.
HR in Hungary
Place your trust in our HR solutions. We’ll support your global employees with legislation and compliance. As HR specialists, we can help you thrive in new markets and countries.
Hungarian Employment Law Compliance
Do you want to seamlessly and compliantly onboard your organization’s people with minimal downtime? As an in-country specialist, we can help with contracts, policies, handbooks and more.
Jump to section
- Europe (Central Europe)
- Calling Code
- Timezone in Capital
- (europe/budapest) 9:16 AM
- Hungarian forint (HUF)
$1 = Ft361.58
- Main Language
- Other Business Languages
- Tax Year Start
- 1st January
- Tax Year Start
- 31st December
Details correct at time of publication. You should not rely on these details without first seeking professional international advice.
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Global Expansion in Hungary
Among Hungary’s main exports are cars and car parts. In 2017, together these accounted for 16% of the country’s export revenue. Other significant industries in the region include pharmaceuticals, chemicals, and electrical goods. Located in central Europe, Hungary has seen industrious success for thousands of years, in part due to trade along the Danube River – the second longest river in Europe – which passes through Hungary and its neighbouring countries.
Today the Danube still accommodates considerable traffic in Hungary, including commercial and tourist ships. As well as this, Hungary is home to six international airports, with 90% of passengers travelling through Budapest airport. There is also a considerable rail and coach network connecting Hungary to the rest of Europe.
Company owners considering branching out to Hungary need to ensure compliance with Hungarian employment law. This means navigating local legislation surrounding all HR and payroll matters. While this can be quite a task, with guidance from the expert team here at IRIS FMP, you can rest assured that employment aspects are properly taken care of. This then frees you up to concentrate on the day to day running of your business.
Employers must submit the following documentation according to deadlines:
- CIT return, before the last day of the fifth month following the accounting year
- Publish annual accounts
- Independent auditor report in the event of a statutory audit of accounting documents
Payroll in Hungary
What tax considerations are there?
Personal Income Tax (PIT)
Hungarian residents are taxed on all income regardless of whether it is obtained from within Hungary or an international source. Non-residents are only taxed on income from Hungary. The Personal Income Tax rate is 15%. In addition to PIT, Hungarian residents pay a social security contribution of 18.5% of their gross income. This is divided into 10% for a pension, 7% for health insurance, and 1.5% as an unemployment contribution.
Corporate Income Tax (CIT)
As will PIT, Corporate Income Tax applies to both non-resident and resident companies – with the latter paying CIT on income derived from both national and international sources. CIT is set at a rate of 9% of the positive CIT base. There are also specific CIT regulations for Real estate holding companies, energy suppliers, and advertisements. Municipalities are also entitled to levy a Local Business Tax – however this is capped at 2% by law.
HR in Hungary
What are the regular working hours in Hungary?
As with many European countries, in Hungary the working day is usually 8 hours starting from between 8am and 9am. Friday is usually a shorter day, with many offices closing at around 4pm. Most banks open at 8am and close early, and shops often stay open until 6pm from Monday to Friday.
Vacation, maternity and sickness
In Hungary there are 16 public holidays for which employees are entitled to the day off. As well as this, employees are allowed 20 days of annual leave – this number increases with age. Parents are also allowed additional days depending on the number of children they have. For one child they can have an additional two days, for two children it’s four days, and it will increase up to the value of seven days in one calendar year.
Maternity leave in Hungary is 24 weeks, which must start four weeks before the predicted birth date. During this time, the employee is entitled to 70% of her average salary. After the birth of the child, the mother is also entitled to two hours of work time allowance every day for nursing, for the first six months, and then one hour after that until the child is nine months old.
Employees are entitled to 15 days of paid sick leave as long as they are enrolled in the national social security scheme. During this time, the employer must pay 70% of their salary. After 15 days the employee is paid at a rate of between 50% and 60% depending on their length of service. One third of this is paid by the employer and the remaining is paid by the state.
Employees and employers must provide 30 days notice to terminate a contract. After three years of employment the notice period must be increased by five days, and increased again at set intervals of service up to the amount of 60 days after 20 years of employment. In the event that the employer chooses to terminate the contract, the employee is entitled to severance pay – as long as the employee has not acted unlawfully. Severance pay can vary from one month’s salary to six month’s salary, depending on their length of service.
Learn more about payroll across the globe
Understand everything you need to know about international payroll with our guide, covering everything from social security payments to parental leave schemes.
IRIS FMP’s Hungarian Payroll and HR Solutions
Business owners who want to expand to Budapest, Győr, Debrecen, or another business centre in Hungary must thoroughly understand the intricacies of HR and payroll in the country. Experts in international employment law, at IRIS FMP we are adept at ensuring companies maintain compliance with all relevant, local legislation. Our services include, but are not limited to:
- HR audits
- HR consultancy
- Payroll audits
- Payroll processing
- Multi-currency payroll
- Hard and soft copy pay slips
- Holiday pay
- Parental leave pay
- Sickness benefits
- Pension payments
- Social security payments
- Payroll reconciliation
- Tax reporting
HR and payroll in Hungary with IRIS FMP
Armed with years of expertise, the team at IRIS FMP will ensure you remain 100% compliant with all Greek employment legislation, enabling you to concentrate on running your expanding business.