SELF-EMPLOYMENT
UnderHungarian law, you are employed, if you perform work for another person or a business, in an employment relationship, based on an employment contract, for a salary. In this case, your employer pays your taxes (personal income tax, social security contributions, etc.), and you receive a net salary at the end of the month. If you are in fact employed, you can read our comparative analysis of the available work related residence permits here: https://expat.jogpro.hu/blog/work-permits
However, if you perform work for multiple clients, or for a single client but not as an employee
buta s an external contractor, you must pay your own taxes, hence you qualify as self-employed. Being self-employed essentially means that you are a freelancer or you operate as a business, depending on your personal approach.
INDIVIDUALENTREPRENEUR / SOLE TRADER
To be self-employed, you need to register with the Hungarian Tax Office (NAV) as an individual entrepreneur or sole trader (egyéni vállalkozó – in Hungarian). You can read our guide to registering as an individiual entrepreneur here: https://expat.jogpro.hu/blog/how-to-register-as-an-individual-entrepreneur-in-hungary
During theregistration process, you have to select an appropriate tax scheme, such as KATA or the General Rate Taxation, or the standard company income taxacation. The choice is yours.
Once registered as an individual entrepreneur, you can apply for a guest self-employed residence permit.
OWNING ACOMPANY
Instead of registering as an individual entrepreneur, if you wish to provide services through a company, you can also register a business company and as the owner of the company, you will be eligible for a guest self-employed residence permit. Forinformation on the types of business companies, you can incorporate in Hungary, please visit: https://expat.jogpro.hu/business
However, if you perform all tasks related to the business, and will be employed by your own
company, you must apply for one of the work residence permits listed here: https://expat.jogpro.hu/blog/work-permits
GUESTSELF-EMPLOYED RESIDENCE PERMIT
Once your business (individual entrepreneur status or company) isregistered, you may lodge your immigration application.
You may submit the application in Hungary (via EnterHungary), if
- you are a citizen of a visa-free country, and you are staying in Hungaryon your visa-free days and you are applying for the first time,
- you are a third country national requiring a visa to Hungary, but youhold a valid residence permit for study purposes, job-seeking residence permit,
a Hungarian Card, an EU Blue Card or a family reunification residence permit.
If you are not from a visa-free country, or you are re-newing your guestself-employed residence permit, you must submit your application outside of Hungary, at an embassy or consulate of Hungary.
Minimum income requirement
As a minimum requirement your annual personal income from your businessmust reach the amount equivalent to 24x the minimum wage in Hungary in the given year.
Validity, extension, renewal
This residence permit is valid for 1 year, which may be extended by an additional 2 years.
After a total of 3 years in Hungary, the residence permit must berenewed. Renewal means that you have to leave Hungary and submit a brandnew application for a residence permit, as a result of which you will lose your years in Hungary, and you will only get the new residence permit for 1 year, which may be extended by an additional 2 years.
Rights & Obligations
Please note that in addition to regular tax reports submitted to the TaxOffice, guest self-employed residence permit holders must file quaterly financial reports to the Immigration Office as well to prove that they are in fact pursuing their business and reaching their minimum personal income requirement.
Holders of a guest self-employed residence permit are only entitled tofamily reunification after the 1st year.
After a total of 3 years, the residence permit must be renewed, including the connected family reunification residence permits.
In terms of permanent residence, its holder is not eligible for aNational Residence Card, only an EU Residence Card, unless their continuous stay in Hungary was interrupted with the above described renewal process.
REQUIRED DOCUMENTS
In order to apply for the guest self-employed residence permit, you mustsubmit the following documents to the Immigration Office:
- client contracts (with exact fees)
- a business plan (with precise revenue streams)
- your educational qualifications to pursue such a business
- certificate of registration as an individual entrepreneur or the company
Additionally, the standard mandatory documents are also required:
- proof of accommodation
- proof of health insurance
- bank account statements.