Capital gains tax in Hungary

Hungary operates one of the European Union's simpler capital gains frameworks. Almost every gain a private individual realises flows into a single tax category and faces the same flat 15% personal income tax (SZJA) rate under Act CXVII of 1995 on Personal Income Tax. Two overlay mechanisms shape the real cost: the 13% social contribution tax (szocho) that applies to many categories of investment income, and two specific relief structures -- the tartós befektetési számla (TBSZ) long-term investment account and the time-based step-down for property sale gains -- that together allow patient holders to reach a zero effective rate.

What rate does Hungary apply to capital gains?

The baseline rate is 15% SZJA on the net taxable gain, applied uniformly under Act CXVII of 1995. Unlike Germany or the United States, Hungary uses no bracket structure for capital income: a HUF 200,000 gain and a HUF 20,000,000 gain are both taxed at exactly 15%. The gain is computed as disposal proceeds less acquisition cost, documented brokerage commissions, and any verified improvement costs for real estate. Gains are reported in the annual SZJA return (form 53) due 20 May of the following year. Hungarian resident banks and licensed domestic brokers withhold SZJA at source for securities transactions, so many filers never interact directly with the 15% rate. NAV (Nemzeti Ado- es Vamhivatal) cross-checks broker-reported data against filed returns automatically.

When does the 13% szocho also apply to investment income?

Many categories of capital income attract a 13% social contribution tax (szocho) on top of the 15% SZJA, bringing the combined headline rate to 28%. Szocho applies to dividends, interest income, and capital gains from securities transactions that do not qualify as controlled capital market transactions. The critical cap: szocho is only due until the individual's total szocho-liable income in the tax year reaches 24 times the monthly minimum wage, which equals HUF 7,747,200 in 2026 (24 x HUF 322,800). Once that threshold is crossed -- counting all income streams subject to szocho together, including employment-related contributions already paid -- no further szocho is owed on additional capital income in that year. High earners whose salaries already exhaust the cap pay only 15% SZJA on capital gains. The cap is tracked cumulatively across income types, so investors with substantial employment income may already be above the ceiling before the first investment income is counted.

What is the TBSZ long-term investment account?

The tartós befektetési számla (TBSZ), introduced under Section 67/B of Act CXVII of 1995, is Hungary's primary vehicle for reducing tax on patient investment capital. An investor opens a TBSZ with a licensed Hungarian broker or bank, makes a minimum initial deposit of HUF 25,000 during the designated collection year, and then holds the account without full withdrawal for at least three years. All trading, rebalancing, and currency conversions are permitted inside the account -- only the total balance cannot be fully withdrawn without triggering early-closure tax.

The tax schedule inside a TBSZ is as follows:

After five complete years the entire balance -- capital appreciation, dividends reinvested, and interest -- exits the account free of both SZJA and szocho. The five-year clock starts from 1 January of the year after the collection year ends. A TBSZ opened and funded in 2024 therefore reaches full exemption on 1 January 2030. Multiple TBSZ accounts can be held simultaneously (one per broker per collection year), giving investors flexibility to ladder several five-year windows.

How does the property-sale gain step-down work?

Gains from selling residential or commercial real estate are not taxed on the full nominal gain. Under Section 62 of Act CXVII of 1995, the taxable proportion of a property sale gain decreases each year the seller holds the asset after acquisition. The schedule below applies the 15% SZJA rate to only a fraction of the gain:

The underlying gain is calculated as: sale price minus verified acquisition cost, minus documented renovation expenditure, minus directly incurred selling costs (agent commission, legal fees). Szocho does not apply to real estate sale income under Hungarian law -- only SZJA applies via the step-down schedule. A seller who purchased a Budapest flat in 2020 and sells it in 2026 (a six-year hold) faces zero Hungarian capital gains tax on the disposal.

What is a controlled capital market transaction and why does it matter?

A controlled capital market transaction (ellenorzott tokepiac-ugylet) is a securities transaction executed through a broker or investment firm that is licensed and supervised by a recognised authority within the European Economic Area -- including the Hungarian MNB (Magyar Nemzeti Bank), the UK FCA, the US SEC, or equivalent -- and that issues a documented annual statement of gains and losses. Transactions routed through an EEA-regulated broker or a major non-EEA exchange typically qualify. The legal significance is straightforward: controlled capital market transaction gains are subject to 15% SZJA only. Szocho does not apply. This contrasts with non-controlled transactions -- gains from unregulated offshore instruments or brokers without recognised supervisory oversight -- which face both 15% SZJA and 13% szocho.

Losses from controlled capital market transactions can be carried forward two years and offset against gains in the same category in the current or either of the following two tax years. The offset operates within the category only: securities losses cannot reduce property gain or employment income. Gains and losses within a single tax year are aggregated, so the net annual figure is what flows into the SZJA return, not individual trade results.

How does Hungary treat non-resident sellers of Hungarian assets?

Non-residents disposing of Hungarian-situs real estate face the same 15% SZJA rate and the same five-year step-down under Section 2(4) of Act CXVII of 1995. Tax is typically withheld by the Hungarian notary (kozjegyzo) at conveyancing. Most Hungarian double taxation agreements follow OECD Model Article 13(1) and assign real-estate gain taxation rights to the state where the property is located -- meaning Hungarian tax is unlikely to be eliminated by a treaty, though a credit for tax paid may be available in the seller's country of residence. Residents of treaty-partner states should verify the specific agreement before assuming relief applies. For a full picture of Hungary's treaty network and residency rules, see the Hungary country overview.

For complex cross-border situations -- including gains on substantial shareholdings in Hungarian real-estate-rich companies and the interaction of Hungarian szocho with foreign social security treaties -- consulting a qualified tax professional familiar with both Hungarian NAV rules and the relevant treaty is the most reliable path.