In case of purchasing a residence the basis of duty on onerous transfer of property—if the law does not define it otherwise—shall be the market value of the residence. The rate of duty shall be 4%.
In case of exchanging residences the basis of the duty is the difference of the market value—gross— of the residences exchanged.
In case of purchasing a home, if the purchasing private person sells the other’s home before the actual purchase or within a year of that, the base of the fee is the difference between the market value of the bought and the sold flats – without the deduction of the mortgage. The so-called negative allowance has been abolished, i.e. if the purchaser of property acquires a residence with lower market value in case of exchanging or selling/purchasing the residence within a year, there must no duty on onerous transfer of property be paid. The exemption from duty applies only to private persons.
A 50 000 HUF fee – per home - has to be paid in case of getting ownership of a home by a foreign legal or natural person according to special legislation for the necessary authorization of the initiated procedure. A 10 000 HUF processing fee has to be paid in case of getting authorization to buy a home property by a foreign natural person, who has the rights to the freedom of movement and residence, or a person with resident status, who initiated the acquisition of Hungarian citizenship. Acquisition of a real estate is not a subject to authorisation in case of inheritance, for a migrant foreign national, a refugee, a person with dual nationality if one of this nationalities is Hungarian, Hungarian nationals living abroad, and foreign nationals if they are citizens of any member state of the EU.
IIf the home does not fall under inheritance or gift tax and is purchased in any other way, beside pecuniary interest of real estate, is under pecuniary interest of property transfer fee.
Mandatory fees for the following property rights:
Unless otherwise specified by the law, the general rate of the duty on onerous transfer of property is 4% for each property up to a value of 1B HUF and 2% for the part of the market value exceeding 1B HUF when acquiring real estate property or financial share in a company that owns real estate in Hungary, however, the duty is capped at 200M HUF per property.
The acquisition of the capital contribution of a company having domestic property assets is always a subject to duty on onerous transfer of property—regardless of the principal activity thereof indicated in the commercial registry.
When acquiring co-ownership in a real estate, 4% duty rate applies to the part of the 1B HUF acquired co-ownership share, and the 200M HUF cap per property must be applied for the proportion of the co-ownership share.
When acquiring rights of pecuniary value relating to real estate, 4% duty rate is applicable to a part of the 1B HUF that is in proportion with the ratio of the value of such rights to the market value of the property, and the same portion of the 200M HUF is applicable as cap.
When acquiring real estate encumbered with a right of pecuniary value – including rights of pecuniary value created contemporarily with the acquisition - 4% duty rate applies to the part of the 1B HUF of the market value the value reduced by of the value right and the part of the 200M HUF cap is applicable that is in proportion with the ratio of value of the ownership right to the market value of the property.
In the case of property swaps, the basis of the duty – with the exception specified in § 21 – is the value of the property acquired with the exchange.
The purchase of a first home is not exempt from duty.If the purchaser is a person under the age of 35 and the market value of the completely purchased property does not exceed 15 million HUF, the purchaser may be entitled to 50% reduction of duty and may apply for instalment free of surcharge. In case of acquiring a proportion of property with the aforementioned market value, the acquirer is entitled to a discount proportional to the extent of the acquired proportion of property.
The tax authority shall grant instalment free of surcharge to be paid in equal monthly amounts for the request of a purchaser, who is a private person (with no upper limit of age) acquiring his or her first residence.
Those who do not own and have never owned a residential property, do not hold and have never held an ownership share of at least 50% in a residential property, or do not have and have never had any rights of pecuniary value associated with a residential property registered in the land registry are deemed first-time residential property buyers. In respect of establishing entitlement for such allowance, residential property encumbered with widow's usufruct and residential property that has been sold before reaching a person’s legal age shall not be taken into consideration.
Those are not considered first-time residential property buyers who have received the allowance before the time of the creation of the duty payment obligation. The buyer must make a statement regarding the need for an allowance declaring that all of its conditions are met prior to the warrant for duty payment entering into force.
On the basis of the act on duties, no duty is payable when a new residential property or a share in such property with a market value of 15M HUF or less is purchased if it has been built or constructed by a building company licensed to build, construct and sell residential properties for the purpose of resale. If the market value is between 15-30 M HUF, duty is payable for the part of the market value exceeding 15M HUF. The duty in this case is 4%. If the market value is above 30M HUF, the duty is payable for the entire value in accordance with the rules for used residential property.
The allowance is to be applied for. The buyer must provide evidence for the tax authority that the conditions of the allowance are met – providing the statement of the contractor regarding its right to build, construct and sell such property and regarding that it is the first sale after the completion of the construction – prior to the warrant for duty payment entering into force.
Similarly to purchasing used residential property, sales of residential properties within 1 year before and after the purchase are opposable if the purchase price of the sold residential property is more than 15 M HUF.
In case of a non-residential property this has not been in effect for years; in the meantime the rate thereof was 6%, as well, now it amounts to 4% (Hungarian Duties Act section 19 paragraph 1).
The acquisition of ownership (ownership share) of a plot of land suitable for the construction of a residential house, and rights of pecuniary value created on such real estate shall be exempt from the duty on onerous transfer of property, if the party buying the property builds a residential house on the real estate within 4 years of the date of submission of the contract for the purposes of imposing the duty, and if the net floor space of the residential suite(s) in the building is at least 10% of the permissible building space fixed in the applicable general zoning plan.
The party buying the property must notify the government authority regarding his intention to build a residential building, not later than the date when the order concerning payment of the duty enters into force.
Residential suite: a constructed structure registered, or in the process of being registered in the real estate registry as a detached house or a residential suite, furthermore, a structure under construction shown as a detached house in the building permit if the walls and the roof structure are completed, furthermore, any rural house standing on a parcel shown as a homestead in the real estate registry.
Residential lot: a building plot defined as such in the Act on the Formation and Protection of the Built Environment, if the land is zoned for residential building in the respective structural plan and/or in the local zoning code, also the parcel of land that is registered with the residential suite, and the parcel of land on which has the rights for using such land connected to the residence.
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