Payroll & Workforce Management in Hungary

What running payroll in Hungary costs and requires

Hungary applies a flat 9% corporate income tax rate, the lowest in the EU, uniformly across company sizes with no progressive bands. The Kft, Hungary's standard limited liability company, requires HUF equivalent of roughly €7,500 in minimum share capital, available for immediate operating use after formation rather than held in escrow.

Operating in Hungary combines the EU's lowest headline corporate rate with a revenue-based local tax that applies regardless of profitability, and a social contribution structure where the employer rate (13%) is comparatively modest but the combined employer-employee burden (~46.5%) remains substantial.

What sits on top of gross salary

13% social contribution tax (szocho) on gross salary — employee side 18.5%, combined burden ~46.5% — this is a direct cost the employer budgets on top of gross pay for every hire, not a deduction from it.

• Local business tax (HIPA) — levied on net revenue, not profit — payable even in loss-making years, up to 2% depending on municipality
• KIVA small business tax regime — — entry threshold raised to 100 employees and HUF 6 billion revenue from December 2025, an alternative to standard CIT for qualifying companies
• Director minimum contribution floor — — social contributions due on at least 30% of minimum wage (HUF 322,800/month for 2026) even for minimally-paid director-shareholders
• Real-time invoice reporting — — mandatory automated upload of nearly all outgoing invoices to the Hungarian Tax Authority's online system

The statutory floor for Hungary

€697/month gross (2026). Underpaying the statutory floor exposes the employer to fines and back-pay claims, and should be checked against any role before an offer is made — thresholds are typically revised annually.

Standard cycle and documentation

Payroll in Hungary runs on a monthly cycle, in arrears. Payslips must itemize gross pay, statutory deductions, and net pay — incomplete or incorrect payslips are exactly what a labour or social security audit checks first, so the format is a compliance requirement, not a formality.

Employer obligations and deadlines

Annual accounts filed electronically with the Company Registry within 5 months of year-end.

Employer registration runs through the Company Registry Court, via electronic filing, typically taking As little as a few business days for a standard Kft.

Frequently asked questions