Transfer tax

Transfer tax is payable when purchasing property. This tax stands at 4 %.
This transfer tax will be 4% on the first HUF 1 Billion of the market value of the real property.If the market value exceeds HUF 1 billion, the transfer tax rate on the excess will be 2 %. The transfer tax will be capped at HUF 200 million.

The extent of the levy is more favourable when purchasing residential property such as houses and residences. Up to a market value 4 million forint, you only pay 2% (80,000 forint). 4% is payable on the residual value.
As for transfer tax, it is important to consult the lawyer or estate agent involved in the purchase procedure, as the law contains a number of discounts and exemptions, such as:
- the purchase of a building plot is tax-free, provided the purchaser builds a house on this plot within 4 years of submitting the purchase contract (in order to determine transfer tax) and the net surface area of the house is at least 10% of the maximum site coverage stipulated in the zoning plan;
- a new owner under the age of 35 will be given a discount when purchasing his (share in the) first house. This discount is subject to a maximum of 50%, but no more than 40,000 forint if the market value of the entire property is below 8 million forint;
- if a residential property is purchased by a private individual who has sold his other residential property before or within one year of this purchase, the levy is calculated on the difference between the purchased and sold residential property.
The transfer tax is assessed by the Hungarian tax authorities (APEH). A foreign citizen who has sold a property will first be given a tax reference number by the local tax office, as well as a tax card (which shows this number) within 3 to 6 months of the purchase. The local tax office will subsequently send the assessment to the owner within 3 to 6 months.

Inheritance law and inheritance tax
A basic rule of inheritance law is that when a property in Hungary is bequeathed, only a Hungarian civil-law notary will be entitled to settle the estate, whose competency is determined by the location of the property.
Foreign owners are faced with an extraordinary clash of laws. Let’s say there is a Hungarian property, owned by a foreigner. The question is which law determines the settlement of the estate procedure: Hungarian law, by virtue of the location of the property, or the deceased’s national law.
The main rule is that if the deceased had no will regarding properties in Hungary, the Hungarian civil-law notary will settle the estate in accordance with Hungarian inheritance law, and the estate will be handed over to the heir according to Hungarian law.
According to Hungarian inheritance law, the descendants of the deceased are those heirs in the direct line, and the spouse will have a lifelong usufruct. If there are no descendants, the spouse will be the heir. If there is no spouse, the relatives in the ascending line will become heirs.
If the deceased did leave a will, the situation becomes more complicated. In that case, the procedure of settling the estate is effectuated by virtue of private law, and the estate is handed over to the heirs.
This means that if there is a valid will, the deceased’s private law supersedes Hungarian inheritance law, yet only the Hungarian civil-law notary is competent to effectuate the settlement of the estate procedure by virtue of the foreign will, and only he can issue a certificate of inheritance. 
If the estate comprises movable property, the estate settlement procedure can be effectuated by both a foreign and a Hungarian civil-law notary.
The heirs must pay inheritance tax on the assets obtained by virtue of inheritance law.
The extent of inheritance tax due depends on the type of assets on the one hand, and on the relation to the deceased on the other.
As shown by the table below, inheritance tax is lower when a residential property is devolved, as is the case with transfer tax.


Inheritance tax