As the new year approaches, the National Tax and Customs Administration of Hungary (NAV) is urging employees to take proactive steps in declaring their eligibility for various tax allowances before the first payroll of January.

In a recent statement, NAV underscores the simplicity and speed of making these declarations online, which allows employers to incorporate applicable tax benefits into January salaries.

These tax allowances are significant for a wide range of eligible individuals, including families with children, newlyweds, mothers raising four or more children, women under the age of 30, individuals under 25, and those suffering from specific diseases.

NAV highlights the utility of its Online Form Filling Application (ONYA) in facilitating these declarations.

The application takes advantage of data already recorded in the NAV’s databases by offering pre-filled details to streamline the process.

Those who begin earning income from employment in 2024 or thereafter will also find that NAV suggests relevant employer data pertaining to their wage income.

Beginning January 16, 2025, employees can access and submit their tax pre-declaration forms using authorized electronic identification methods such as Ügyfélkapu+ or the DÁP mobile app.

Once submitted electronically, NAV automatically forwards these declarations to the employee’s employer, with the process being trackable via notifications in the ONYA system.

Of note, the tax allowance for individuals under the age of 25 continues to be processed automatically, requiring no action from the employee or employer.

For those eligible for allowances such as the four or more children mothers’ allowance, personal allowance, or the newlyweds’ allowance, employers can continuously account for these allowances based on previous declarations, unless a new declaration is made.

Thus, beneficiaries need not submit new tax pre-declarations annually to avail themselves of ongoing benefits.

Additionally, an increase in the family tax allowance will be implemented in two phases, with a 50% increase set for July 2025.

Consequently, parents with one child will see their allowance increase from 10,000 to 15,000 forints, two children from 40,000 to 60,000 forints, and families with three or more children will receive an increase from 33,000 to 49,500 forints per child.

PwC Hungary also echoes NAV's advisories, emphasizing the importance of January readiness in declaration filings to take advantage of these allowances.

For instance, in the case of a family with two children, either a 266,660-forint tax base allowance or the declaration of two dependent beneficiaries can lead to a tax saving of 40,000 forints monthly from the beginning of the year.

In conclusion, NAV’s digital platforms and early year preparation streamline the process for Hungarian employees to maximize their entitled tax benefits effectively.