Tax Law
Taxation is one of the most critical areas in the lives of businesses and individuals: it is not only an obligation, but also an opportunity. A well-considered tax strategy can help optimise operations, reduce the tax burden, and avoid unpleasant surprises. Tax law is a rapidly changing, complex system that requires interpretation and application by an experienced expert – this is where our practice can help, working with tax law specialists who also have a business mindset.
How can a tax lawyer help?
In addition to tax advisors and accountants, a tax law specialist can answer questions where not only accounting, but also legal liability and risk are involved. Our clients include private individuals, company directors, business associations, foreign investors, and start-ups. Our office not only supports the legal operation of your business, but also provides assistance in tax optimisation – in other words, how to develop the most favourable tax regime and practices within the framework of the law.
Tax advice for individuals
Many private clients believe that taxation is limited to the personal income tax (PIT) return, which is “done by the tax authority”. However, the reality is more complex: for different types of income, property sales, inheritance, dividends, cryptocurrencies, or income from abroad, incorrect returns can easily result in penalties or additional tax payments.
As part of our tax advisory services for individuals, we help with:
- Lawful and advantageous preparation of the PIT return
- Clarification of the tax implications of property sales, inheritance, and gifts
- Determining the Hungarian tax consequences of foreign income, such as dividends, salaries, or rental income
- Managing risky or new types of income (e.g. cryptocurrency, online income)
Corporate tax and business structures
For companies, tax issues cannot be separated from strategic operations. Choosing the wrong legal form, an unfavourable cost accounting method, or inappropriate transfer pricing can result in significant additional burdens. Our office provides support in interpreting the corporate tax (TAO) system, developing the right business structure, and mapping out lawful tax reduction opportunities.
Our services include:
- Drafting articles of association optimised for tax purposes
- Comparing KIVA, TAO, EVA, and other tax regimes
- Taxation of dividends, shareholder loans, and owner payments
- Preparation for tax audits and official representation
Hungarian tax rules for foreigners
Hungarian tax rules are often opaque for foreign individuals and companies. Whether it’s buying property in Hungary, setting up a local business, or income arriving in Hungary from abroad, it is always necessary to understand tax obligations and opportunities. Knowledge of international law and bilateral tax treaties is essential – and this is exactly where our practice can help.
Based on our experience, the most common questions are:
- When is a foreign national required to pay tax in Hungary?
- What taxes apply to the utilisation or sale of Hungarian property?
- Does a Hungarian company owned by foreigners have to pay corporate tax?
- How is double taxation avoided?
We provide all these services in English, German, and Italian to ensure foreign clients understand precisely what their obligations are – and what they are not.
Tax optimisation – legally but consciously
Tax optimisation is not the same as tax evasion. It means finding legally sound but advantageous solutions – whether it is about the operation of sole proprietors, restructuring company structures, or inheritance and wealth planning steps. Tax planning not only saves costs, but also ensures stable, predictable operations in the long term.
Our practice helps with:
- Separation of corporate and private assets
- Legal and tax structuring of family businesses and holdings
- Taxation of inheritance and gift transactions
- Lawful accounting of occasional or regular income and side activities
Who is our tax law practice for?
- Company directors seeking long-term, lawful, and cost-effective operation
- Private individuals with more complex income structures (rental income, dividends, foreign income, etc.)
- Start-up founders for whom proper structure and tax planning are important from the outset
- Foreign investors wishing to understand and comply with Hungarian tax rules
1. When is it necessary to involve a tax lawyer?
If you expect a tax audit, have income from abroad, or want to reduce your company’s tax burden, it is definitely worth seeking help from a tax law specialist. They not only know the rules, but can also apply them to your specific situation. This way, you can avoid fines and optimise your operations.
2. What does tax optimisation mean?
Tax optimisation is conscious tax planning within the framework of the law, reducing the amount of tax payable without breaking the law. It is an opportunity available to both individuals and companies. With a well-structured plan, significant savings can be achieved.
3. When do I have to pay PIT on foreign income?
If you are a Hungarian tax resident, you must pay personal income tax on your income from abroad as well – taking into account the relevant tax treaties. The exact obligation depends on the type of income (e.g. salary, dividend, rental income). A tax law specialist can help with the correct declaration and avoiding double taxation.
4. What is the best form of company from a tax perspective?
This depends largely on the type of activity, turnover, and long-term goals. You may choose KIVA, TAO, or sole proprietorship – each has different tax advantages. For tax optimisation, professional pre-planning is essential.
5. How is dividend taxation handled in Hungary?
For individuals, 15% PIT and 13% social contribution tax must be paid on dividends, up to a certain ceiling. At the company level, dividends can be distributed after payment of corporate tax. Tax advice helps with precise calculations and lawful distribution.
6. Who can help me if I am subject to a tax audit?
It is advisable to have a tax law specialist or tax lawyer represent you from the start of the investigation. They know the procedures of the tax authority and can use legal tools for your protection. This can significantly reduce risks and the chance of fines.
7. How is cryptocurrency taxed?
Personal income tax must be paid on income from cryptocurrencies, typically on realised gains. The regulations are complex and constantly changing. Involving a tax law advisor can be useful in this area as well.
8. What are the Hungarian tax rules for foreigners?
Foreign individuals may also have tax obligations in Hungary, for example in the case of property rentals, property sales, or company ownership. Bilateral tax treaties must also be considered. A tax law specialist helps you navigate both Hungarian and international rules.
9. What taxes apply to my company?
The main corporate taxes are: corporate tax (TAO), small business tax (KIVA), local business tax, VAT, and other contributions. The chosen tax regime determines your costs in the long run. The right structure is best selected together with tax advice and legal background.
10. Does tax law advice mean savings or security?
Both. A good tax law specialist not only helps to avoid mistakes, but with conscious and lawful tax planning, you can save hundreds of thousands or even millions of forints a year. Security lies in the fact that taxation is no longer a risk, but a controlled process.
Our experienced team is at your disposal