The government on 18 March 2020 introduced amendments to social security and certain tax payment rules in response to the coronavirus (COVID-19) pandemic.
Modified social security rules are to apply for the period of March-June 2020 for certain sectors—the hospitality and tourism sector; entertainment, film industry, and performing art sector; the sport services sector; the event organization sector; and the gambling section. The changes provide that employers in these sectors will not be liable to pay the employer part of social security contributions (17.5% + 1.5%) with respect to employment income paid to employees for the period March-June 2020. Moreover, employees will only be liable to pay 4% healthcare social security contribution on their employment income received during the March-June 2020 period (instead of the aggregated 18.5% social security contribution). Nevertheless, the upper limit of the healthcare social security contribution will be HUF 7,710 a month.
Individual (personal) income tax must still be paid for March-June 2020.
Special rules will also apply for entrepreneurs dealing with passenger transport if they have opted for simplified lump-sum taxation (known as “KATA” in Hungarian). Based on the amendments, these entrepreneurs are not required to remit the lump-sum tax for the March-June 2020 period.
Read a March 2020 report prepared by the KPMG member firm in Hungary
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