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What is Hungary's Capital Gains Tax All About?

August 25, 2022
2022-08-25
When you sell your property in Hungary, all you're really hoping for is that everything goes well. Every step is taken, every cost and paid, and you won't get into legal trouble at the end of the day. You probably have after things to worry about after the sale, don't you? But before you deal with them, you still need to pay the capital gains tax in Hungary. It's an important cost that you shouldn't forget. Not unless you want to get in trouble with the law. Know more about the basics of this specific tax!

What is Hungary's Capital Gains Tax All About?


Is There a Capital Gains Tax in Hungary?

It's not necessarily wrong to say that there is no capital gains tax in Hungary. The principle still exists, they don't just call and refer to it as such here. Commonly, the capital gains tax in Hungary is known as another form of income tax. You even have to report it in your annual tax return. This comes as no surprise considering that the tax is imposed on the profit you earn, after all. Generally speaking, the Hungarian tax system barely differentiates the two. They even have similar tax rates too!


What is The Tax Rate?

Speaking of the tax rate, the capital gains tax in Hungary only has one: 15%. So no matter how much you earned from selling real estate in this country, the tax rate remains the same. According to Worldwide Tax Summaries, the only time it changes is when it fails to meet certain conditions. In this situation, you'll be required to pay an additional 13% in social tax. If not, you only have to pay the intended 15%. And you'd do well to have your own local bank account too since it will be easier to pay this tax through one.

What is Hungary's Capital Gains Tax All About?



What are The Other Property Taxes in Hungary?

Apart from the capital gains tax, more commonly known as another form of income tax, you also need to stay aware of the property tax. Usually, it's the buyer who pays for this during the real estate process in Hungary. It's an important cost that will allow them to purchase and own real estate in Hungary. The tax rate for this one is 4% and it remains the same no matter what type of property was purchased. It's 4% when for the apartment/house's value. It's 4% when it's an empty lot. And it's still 4% when it's a commercial property.


Are Crypto Transactions Taxed Here Too?

Since cryptocurrencies are becoming more common nowadays, even Hungary's tax system has learned to adapt to this phenomenon. As of January 2022, transactions made via cryptocurrencies will be taxed by the Hungarian government. This, of course, includes the sale of any property in Hungary. Don't worry! Even though it involves cryptocurrencies, the nature of the tax remains the same. This means that the tax rate is still 15% with an additional 13% in social taxes if it fails to meet certain conditions.

What is Hungary's Capital Gains Tax All About?


If there's one thing you ought to pay attention to when you sell your property in Hungary, it's the capital gains tax! Don't forget to pay it when you've got the payment from the buyer. It's one of the most important parts of the process.




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