Sole Trader in Hungary (Egyéni Vállalkozó) as a Foreigner: 2026 Rules, Taxes and the Fixed Monthly Floor
Registering as a Hungarian sole trader — egyéni vállalkozó, usually shortened to EV — is free, fully online, and finishes the same day. There is no capital requirement, no notary, no court filing. Compared with the HUF 3 million share capital and the incorporation process behind a Kft., it looks like the obvious entry route.
Two things decide whether it actually is. First, your residence status has to permit self-employment — registering an EV does not create a right to live in Hungary, and for non-EU nationals the self-employment route is time-limited. Second, an EV carries a fixed monthly contribution floor of roughly HUF 101,700 that runs whether you invoice HUF 5 million or nothing at all. This guide covers both, with the 2026 numbers.
Who is allowed to register
Act CXV of 2009 (the Evectv.) sets out who may be a sole trader. In practice there are three groups:
| Group | Position in 2026 |
|---|---|
| Hungarian citizens | Register freely |
| EU/EEA nationals and persons exercising free movement rights | Register freely; register your residence with the immigration authority as usual |
| Third-country nationals | Only with a residence title that permits self-employment |
For the third group this is the real gate. Under the immigration act in force since 2024, a non-EU national who wants to operate as a Hungarian sole trader normally needs a residence permit for guest self-employment (vendég-önfoglalkoztatás célú tartózkodási engedély). Two features of it change the plan for most people:
- it is issued for a maximum of one year and can be extended for the same purpose, but the total validity cannot exceed three years from first issue;
- for the first year, a family member of the holder generally cannot obtain a residence permit for family reunification.
If your horizon is longer than three years, or your family is coming with you, the sole trader route is usually the wrong container and a Kft. is the right one. Check your own permit category with the immigration authority (OIF) before you register anything — permit rules move faster than tax rules, and a mismatch is expensive to unwind.
One point that catches people out: holding a Hungarian address card or a residence permit issued for employment does not automatically entitle you to self-employed activity. The permitted purpose printed on the permit governs.
The registration itself
The notification is submitted electronically, through the Webes Ügysegéd online administration service, and it is free of charge and exempt from duty. You need a Hungarian electronic identity — Ügyfélkapu+ or the DÁP mobile app — and a Hungarian tax identification number.
On successful submission the register records your tax number and statistical identifier automatically, and you may start the activity on the day of registration. There is no waiting period and no certificate to collect.
What you actually have to decide before you click submit is more important than the form itself:
- Main activity code (ÖVTJ/TEÁOR) — this drives which flat-rate cost ratio you may use and whether the higher contribution floor applies.
- Income tax regime — flat-rate (átalányadó), itemised (VSZJA), or KATA.
- VAT status — small-business exemption or standard VAT.
- Seat address (székhely) — it determines your local business tax municipality.
The three tax regimes in 2026
| Flat-rate (átalányadó) | Itemised (VSZJA) | KATA | |
|---|---|---|---|
| How income is found | Revenue minus a statutory cost ratio | Revenue minus documented costs | Not relevant — fixed tax |
| Cost ratios 2026 | 45% general, 80% listed trades and services, 90% retail only | actual invoices | — |
| Revenue cap | HUF 38,736,000 (45%/80%), HUF 193,680,000 (90%) | none | HUF 18,000,000 |
| Tax | 15% PIT on income above the exempt band | 9% on profit, then further tax on withdrawals | HUF 50,000/month flat |
| Who you may invoice | anyone, companies included | anyone | private individuals only |
Three details matter more than the table:
- The flat-rate general cost ratio rose from 40% to 45% in 2026, and is legislated to reach 50% in 2027. On general-band activity, 55% of revenue is now taxable income.
- The tax-free income band: under the flat-rate regime, income up to half the annual minimum wage — HUF 1,936,800 in 2026 — is exempt from personal income tax. It is tracked cumulatively during the year. Crucially, it is exempt from income tax only: contributions are still payable on it.
- KATA is far narrower than its reputation. Since 2022 it is available only to a full-time sole trader who invoices exclusively private individuals. One company invoice ends it. Above the HUF 18 million annual cap a 40% surtax applies. For almost every foreign consultant, developer or designer with business clients, KATA is simply not available.
The number nobody mentions: the contribution floor
This is where the sole trader form stops being cheap. A full-time EV pays social contributions on at least a statutory minimum base, regardless of what was actually earned:
| Item | Rate | Minimum monthly base 2026 |
|---|---|---|
| Social security contribution (tb-járulék) | 18.5% | HUF 322,800 (minimum wage) |
| Social contribution tax (szocho) | 13% | HUF 322,800 |
Minimum monthly cost: HUF 322,800 × 31.5% ≈ HUF 101,700. That is roughly HUF 1.22 million a year, payable in a month with zero revenue.
If your main activity requires at least secondary-level qualification, the floor is the guaranteed wage minimum of HUF 373,200, which lifts the monthly figure to about HUF 117,600.
Two 2026 changes soften and simplify this:
- The szocho minimum base multiplier of 112.5% was abolished — the floor is now 100% of the minimum wage for both charges.
- Sole traders now report and pay their own contributions quarterly rather than monthly, on form 2658, by the 12th day of the month following the quarter (12 April, 12 July, 12 October, 12 January).
A “secondary” sole trader — someone who also holds a full-time Hungarian employment relationship — is not subject to the floor and pays contributions on actual income. That distinction is worth more than any choice of cost ratio.
Worked example: HUF 16 million of revenue, general band
An IT consultant with business clients, flat-rate taxation at the 45% cost ratio, HUF 16,000,000 of annual revenue (roughly EUR 40,000 at a 400 HUF/EUR rate):
| Step | Calculation | Amount |
|---|---|---|
| Revenue | — | 16,000,000 Ft |
| Less 45% cost ratio | 16,000,000 × 45% | −7,200,000 Ft |
| Taxable income | 55% of revenue | 8,800,000 Ft |
| Less tax-free band | half the annual minimum wage | −1,936,800 Ft |
| PIT at 15% | 6,863,200 × 15% | 1,029,480 Ft |
| Tb-járulék 18.5% | 8,800,000 × 18.5% | 1,628,000 Ft |
| Szocho 13% | 8,800,000 × 13% | 1,144,000 Ft |
| Local business tax (simplified band) | HUF 6m base × 2% | 120,000 Ft |
| Total public burden | — | ≈ 3,921,480 Ft |
That is about 24.5% of revenue, all in — and this consultant stays under the HUF 20 million small-business VAT exemption threshold, so no VAT is charged or reclaimed. Compare it against a Kft. paying 9% corporate tax and then dividend tax on distribution before deciding; we walk through that comparison in taking profit out of a Hungarian company.
VAT, local business tax and invoicing
VAT. The small-business exemption threshold is HUF 20,000,000 for 2026 (rising to HUF 22m in 2027 and HUF 24m in 2028). Two traps: cross-border B2B services are outside the exemption’s logic, so you still need an EU VAT number and must file recapitulative statements; and once you cross the threshold mid-year, the invoice that breaches it is already a VAT invoice. See VAT registration for foreign companies in Hungary.
Local business tax. A sole trader pays HIPA too, at up to 2% of revenue to the seat municipality. Under HUF 25 million of revenue you may elect a fixed statutory base — HUF 2.5m, 6m or 8.5m — which caps the annual cost at HUF 50,000, 120,000 or 170,000. The mechanics are in our local business tax guide.
Invoicing. Every invoice must be reported to NAV’s Online Számla system in real time, which in practice means using compliant Hungarian invoicing software from day one — not a spreadsheet.
Sole trader or Kft.? A short decision test
Choose the EV if: you are an EU/EEA national or already hold a qualifying long-term residence status; your revenue is modest; your work carries little liability risk; and you want the lowest possible setup effort.
Choose the Kft. if: you are a non-EU national planning to stay beyond three years or bringing family; you have co-founders; you need limited liability; you expect to retain profit in the business rather than draw it all (9% corporate tax versus the personal rates above); or you need a structure a bank or an enterprise client will accept without questions. Our company formation cost breakdown has the first-year numbers.
FAQ
Can I register as a sole trader in Hungary without living there? No. The Evectv. requires a qualifying citizenship or residence status; the EV registration itself does not grant any right of residence.
How long does registration take? The notification is electronic and free, and the activity may begin on the day of registration.
What is the minimum I will pay per month? About HUF 101,700 as a full-time sole trader on the minimum wage floor, or about HUF 117,600 where the guaranteed wage minimum applies — before any income tax.
Can I invoice companies under KATA? No. KATA is restricted to sole traders invoicing exclusively private individuals.
Can I pause the business? Yes — a sole trader may suspend the activity, which stops the contribution obligation for the suspended period. It must be notified properly to take effect.
Updated: 2026-08-19 · Tax year 2026. Immigration eligibility is decided by the immigration authority on your individual permit category and is not a tax question — confirm it with OIF or immigration counsel before registering. Tax figures are from NAV’s 2026 guidance and the acts cited above; your cost ratio depends on your actual activity codes.
Not sure whether a sole trader registration or a Kft. fits your situation? Get in touch or see our Hungarian company formation service — we will model both against your expected revenue before you commit.