Expat Investment Advice in Hungary: Residency-by-Investment and Tax Guide

Hungary has become one of Central Europe’s most practical and cost-efficient destinations for expat investors. It offers a competitive tax system: a 9% corporate income tax, the lowest in the European Union, and a flat 15% personal income tax.

Recent reforms have made Hungary even more appealing. A new residency-by-investment program launched in 2024 offers new residence options in exchange for sizeable investments in an approved Hungarian real estate fund.

Combined with an expanding double-tax treaty network, clear property rights, and its central location between Western and Eastern Europe, Hungary provides a stable investment base for both active business owners and passive investors.

This article explores expat consulenza sugli investimenti in Hungary, from taxation and residency to real estate.

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Le informazioni contenute in questo articolo hanno un valore puramente indicativo. Non costituiscono consulenza finanziaria, legale o fiscale e non rappresentano una raccomandazione o una sollecitazione a investire. Alcuni fatti potrebbero essere cambiati dal momento della stesura.

Living in Hungary: The Hungary Guest Investor Golden Visa

Hungary’s Guest Investor Program, launched in 2024, offers a 10-year residence permit, renewable for family members, through a minimum €250,000 investment in an approved Hungarian real estate fund.

The program restored the country’s position in the European residency-by-investment space after several years of absence.

Unlike traditional golden visa schemes centered on direct property purchase, Hungary’s route focuses on fund participation, which provides oversight and removes speculation risk tied to individual real estate assets.

The qualifying funds must be managed by licensed Hungarian fund managers and approved by the National Bank of Hungary (MNB), ensuring regulatory transparency.

Investors purchase units in these real estate investment vehicles, which typically hold diversified portfolios of residential and commercial projects across Budapest and regional growth areas. The investment must be held for at least five years to maintain eligibility.

Additional options have been proposed, including a €500,000 direct property purchase or a €1 million public donation to an approved institution, but these remain secondary to the fund-based route, which is expected to dominate applications through 2025.

Successful applicants receive long-term residence permits granting visa-free access to the Schengen Zone, with no minimum stay requirement to retain status.

For non-EU expats seeking a stable European base, this path combines EU residency, investment security, and potential capital appreciation.

Can foreigners buy property in Hungary?

Yes, foreigners can buy property in Hungary but with clear distinctions between EU/EEA/Swiss citizens and non-EU nationals.

For EU, EEA, and Swiss buyers, property ownership is unrestricted. Purchases are processed directly through a Hungarian lawyer who handles title searches, contracts, and land registry filings.

For non-EU citizens, however, a purchase permit from the relevant county or metropolitan government is required.

The process typically takes four to six weeks and involves demonstrating the legitimacy of the buyer, the property’s lawful use, and that the purchase poses no public interest concerns.

Once approved, ownership rights are equivalent to those of Hungarian citizens.

The purchase process is relatively straightforward:

1. Preliminary agreement and deposit (usually 10%)
2. Application for purchase permit if required
3. Final sale contract drafted and notarized by a licensed Hungarian lawyer
4. Title registration at the Land Registry Office
5. Payment of transfer tax

Opening a Bank Account in Hungary

Opening a bank account in Hungary as a foreigner differs slightly for residents and non-residents.

Most major Hungarian banks such as OTP Bank, Erste, Raiffeisen, CIB, and UniCredit allow foreign clients to open accounts in both Hungarian forint (HUF) and euro (EUR). English-language support is standard in larger branches, especially in Budapest.

If you hold a Hungarian residence card or are enrolled in the Guest Investor Program, the process becomes faster and more flexible, allowing access to online banking and additional financial services.

 For non-residents, banks typically require:

• A valid passport or EU ID card
• Proof of address (domestic or foreign)
• Tax identification number (local or foreign)
• Initial deposit (often minimal)

Non-residents without local address documents may face restrictions, such as limited account functionality or the inability to access credit products.

Once opened, accounts can hold multiple currencies and link to international SWIFT transfers, debit cards, and brokerage accounts.

For investors planning to buy property, maintaining both HUF and EUR accounts helps manage exchange-rate fluctuations between purchase and settlement.

Hungary Tax Rules for Expats

Hungary’s tax system is simple, predictable, and favorable to investors. All individuals, whether local or foreign, are subject to a flat 15% personal income tax (PIT) on most types of income.

However, several additional rules apply to investment returns, especially after recent tax reforms extending the social contribution tax (szocho) to certain financial income.

• Interest Income: 15% PIT plus 13% szocho, unless exempted (for example, through a TBSZ account or foreign bank interest under treaty).
• Dividends: 15% PIT, with possible 13% szocho for residents up to an annual income cap; non-residents may benefit from reduced withholding tax under a double tax treaty.
• Capital Gains: Capital gains on shares, investment fund units, and other securities are generally subject to both PIT and szocho (capped), unless held in a TBSZ or are publicly traded bonds/fund units where the szocho applies.
• Rental Income: 15% PIT on net profit, with deductible expenses such as maintenance, agent fees, and utilities.
• Crypto Income: 15% PIT under simplified rules with no szocho; from 2025, regulation will align with EU MiCA standards for digital assets.

Hungary’s broad double-tax treaty network covering more than 80 countries ensures most foreign investors can avoid double taxation. Dividends, interest, and royalties paid to non-residents are usually taxed at 15% or less, and in some cases are exempt altogether.

For long-term residents, combining Hungary’s flat-rate simplicity with strategic use of the TBSZ account can eliminate most investment taxation entirely.

After five years, returns from securities and savings held under TBSZ become fully tax-free, allowing investors to compound income without erosion from annual taxes.

Hungary Property Prices and Taxes

Transaction costs are modest. Legal fees average 1–1.5% of the property value, and property transfer tax stands at 4% on amounts up to 1 billion Hungarian forint (HUF) and 2% above that threshold, with a total cap of HUF 200 million per property.

There is no national annual property tax, though certain municipalities or resort towns may levy small local charges.

For new-build properties, Hungary continues to apply a 5% VAT rate (extended until December 31, 2026) on residential developments meeting specific energy and permit standards.

Budapest remains the focal point for foreign investors, offering competitive yields relative to Western Europe. Average rental returns can range between 4–6%, with strong demand from students, nomadi digitali, and multinational employees.

Outside the capital, cities such as Debrecen, Szeged, and Győr are gaining traction due to industrial expansion and improved infrastructure.

Non-residents can repatriate rental income freely, subject to 15% personal income tax on net profits, and in some cases a 13% social contribution tax on interest or savings income.

For those planning to stay long term, becoming a resident and opening a TBSZ account can eliminate or defer these liabilities.

Hungary Tax Exempt Savings Account (TBSZ)

Expat residents can also access Hungary’s unique TBSZ (Tax-Exempt Savings Account) system. A TBSZ is a long-term investment account that allows individuals to invest in stocks, funds, or deposits with 0% income tax after five years (or 10% after three).

To qualify, you must be a Hungarian tax resident and open the account with a local financial institution. While not available to non-residents, the TBSZ remains one of the most efficient investment tools for expats settling in Hungary long-term.

Hungary also has a well-developed fintech scene. Digital banks like Revolut and Wise operate locally, supporting forint transfers and integration with Hungarian accounts, providing convenient solutions for expats managing cross-border income or multiple currencies.

Corporate and Business Taxes in Hungary

Hungary offers one of Europe’s most business-friendly tax regimes, designed to attract both small entrepreneurs and multinational investors. The corporate income tax (CIT) stands at a flat 9%, the lowest statutory rate in the European Union.

This simplicity is a major draw for expats setting up holding companies, consulting firms, or real estate vehicles.

In addition to the national corporate tax, companies are subject to a local business tax (HIPA) of up to 2%, depending on the municipality. This applies to gross revenue minus limited deductions, making it important to plan location and structure carefully.

Certain cities, including Budapest, apply the full rate, while smaller towns may reduce or temporarily suspend it to encourage investment.

For small businesses and freelancers, Hungary offers the KIVA regime, a simplified tax for companies with revenue up to roughly HUF 3 billion.

KIVA replaces corporate tax, local business tax, and payroll taxes with a single 10% rate on adjusted cash flow, significantly reducing administrative complexity.

This makes it especially attractive for foreign consultants, tech startups, or remote professionals operating locally.

Opening a Company in Hungary

The most common structure for expats opening a company in Hungary is the Kft. (Korlátolt Felelősségű Társaság), equivalent to a limited liability company.

It requires a minimum share capital of HUF 3 million, a registered address, and at least one director (who does not need to be a resident). The Zrt. (private company limited by shares) is better suited for larger ventures or joint-stock operations.

Incorporation is handled electronically, often completed within three to five business days through a local law firm or accounting office.

Hungary’s EU membership provides free access to the European market, while its double-tax treaty network ensures efficient profit repatriation.

Dividends distributed to foreign parent companies are often exempt from withholding tax, and capital gains on share sales can benefit from treaty protection.

For this reason, Hungary is sometimes used as a regional holding base, particularly for Central and Eastern European investments.

Expats considering active business operations should also account for payroll and social contributions, totaling roughly 33.5% (13% employer + 20.5% employee).

Despite these, Hungary’s low corporate rate and predictable legal environment make it one of the most cost-effective jurisdictions for regional entrepreneurship within the EU.

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Adam è un autore riconosciuto a livello internazionale in materia finanziaria con oltre 830 milioni di visualizzazioni di risposte su Quora, un libro molto venduto su Amazon e un contributo su Forbes.