Tax Exemption for Young People Under 25 in Hungary

Tax Exemption for Young People Under 25 in Hungary

Since January 1, 2022, young people under the age of 25 have been eligible for a special tax exemption in Hungary. This means that they do not have to pay personal income tax (SZJA) on certain types of income, up to a specific limit.

This tax relief can make a significant difference in the income of young workers and students who are just starting their careers.

Who Can Get This Tax Benefit?

You are eligible if:

• You are under 25 years old, and
• You have income from legal sources, such as:
• Wages from employment
• Sickness benefits (if you are on sick leave)
• Income as a freelancer or sole entrepreneur
• Income from agricultural activities
• Earnings from freelance contracts (e.g. author or service contracts)

Important: This benefit does NOT apply to income from property rental or other types of income not listed in the tax law.

How Much Tax Can You Save?

In 2022, the maximum monthly tax-free income for under-25s was HUF 433,700, which meant HUF 65,055 in monthly tax savings.

• This added up to HUF 780,660 per year in tax savings.
• The exact amount changes each year, as it is based on the average gross monthly salary in Hungary, as published by the Central Statistical Office (KSH).

In 2025, this monthly limit is HUF 576,601 (updated figure), meaning even more income is tax-free.

If you earn more than this limit in one month, only the income above the limit will be taxed at 15%.

How Long Can You Use This Benefit?

You can use this tax exemption:

• Until the month you turn 25.
• It is available for all the full months before your 25th birthday.
• You can first use it for income earned in 2022 or later.

Do You Need to Apply?

Usually not.
Your employer or the company that pays you will automatically apply the tax exemption if you are eligible.

You only need to submit a declaration if:

• You don’t want the tax benefit (for example, if you know you will exceed the income limit),
• You have multiple employers and want to manage how the exemption is used to avoid overclaiming.

Tip: If you are working multiple jobs and your total income is higher than the monthly limit, it’s important to inform your employers. This helps avoid problems when filing your annual tax return.

What If You Are Married and Under 25?

• If two young people under 25 get married, they cannot receive the first-married couples tax benefit until one of them turns 25.
• Once that happens, they can start using the first-married benefit from the following month.
• If they got married before 2022, they had to temporarily pause the first-married benefit while they were receiving the under-25 exemption.

This rule prevents overlapping benefits and ensures a fair distribution of tax reductions.

How This Fits with Other Tax Benefits

If you are eligible for multiple tax reductions (for example, if you are also a parent, newly married, or have a disability), the under-25 tax exemption must be applied in a specific order:

1. Mothers of 4 or more children (if applicable)
2. Under 25 tax exemption
3. Disability allowance
4. First-married benefit
5. Family tax allowance

This order ensures that your total benefit is calculated correctly and fairly.

For more information, check: https://nav.gov.hu/ado/szja/25-ev-alatti-fiatalok-kedvezmenye