Top-up tax in Hungary 2026: who pays the 15% minimum?

Who is in scope

The rules apply to group members whose ultimate parent reports consolidated revenue of at least EUR 750 million in two of the four financial years preceding the tested year. Two points that surprise foreign finance teams:

• The size of the Hungarian entity is irrelevant. A subsidiary with five employees is in scope if the group is above the threshold.
• Purely domestic groups are covered too. Hungarian-owned groups above the threshold face the same obligations – this is not limited to multinationals.

Hungary implemented the EU directive in Act LXXXIV of 2023, applicable from 1 January 2024.

Why 9% is not the whole story

The effective tax rate (ETR) is measured against covered taxes, and in Hungary these include corporate income tax, local business tax, the innovation contribution and the income tax of energy suppliers.

Local business tax is the decisive one, because its base is not profit – it is closer to gross margin. A company with thin margins pays little local business tax relative to its profit, while a service company with high margins pays a lot. Here is the same HUF 1 billion of profit in three profiles (2% local business tax, 0.3% innovation contribution):

The practical rule of thumb: if the local business tax base is roughly two to three times the profit, the 15% floor is usually met without a top-up. Below that, expect a liability. Distribution, wholesale and contract manufacturing entities in Hungary are the ones most likely to owe top-up tax – precisely the entities a group would not expect to be a tax problem, because their profits are small.

What this calculation leaves out: the statutory ETR calculation adjusts both the GloBE income and the covered taxes (net tax expense, dividends, gains on shares, penalties, intra-group financing and more), and deferred tax is treated under separate rules. The figures above show the order of magnitude and what drives the outcome – they do not replace an actual computation.

Hungary collects the top-up itself: QDMTT

Hungary introduced a qualified domestic minimum top-up tax (QDMTT). When the ETR in Hungary falls below 15%, the difference is collected by the Hungarian state rather than at the level of the parent jurisdiction.

For a foreign parent this is not merely a transfer of revenue between treasuries – it changes the compliance work. The Hungarian QDMTT is calculated from the Hungarian entity's own statutory or IFRS accounts, not from the parent's consolidated figures. In practice the Hungarian finance team has to be able to produce that calculation locally.

The base can be reduced by the substance-based income exclusion: a set percentage of tangible asset carrying value and payroll cost is carved out, with the percentages declining over the transition period. Groups with real assets and staff in Hungary pay less.

Deadlines and the HUF 10 million penalty

• Registration: in-scope entities must notify the tax authority each year, within 12 months of the first day of the tax year. The exact date is set out in the guidance accompanying the NAV form.
• Advance payment: the top-up tax advance is due by the 20th day of the 11th month following the end of the tax year – 20 November for calendar-year taxpayers.
• Final return and the GloBE Information Return: generally within 15 months of the year end; for the first year in scope the deadline extends to 18 months. For financial year 2024 and calendar-year taxpayers this was 30 June 2026.

Missing, late or incomplete filings can attract a default penalty of up to HUF 10 million – and this applies even if no top-up tax is ultimately payable. The filing obligation is independent of the liability.

The transitional safe harbour

In the first years of the regime, groups may use a simplified test based on country-by-country reporting data to establish that no top-up tax arises in a jurisdiction. Many Hungarian entities qualify, which removes the need for a full ETR computation for that year. It does not remove the registration and filing obligations.

What to do now

1. Confirm scope at group level, not at Hungarian entity level.
2. Compare the local business tax base with profit for the Hungarian entity. That single ratio tells you whether a top-up is likely.
3. Meet the deadlines regardless of whether tax is payable.
4. Involve a Hungarian adviser. The adjustments and safe harbour tests are not something to work out from a summary – including this one.

For the general Hungarian corporate tax rules see our corporate tax guide, and the corporate tax calculator for the 9% computation. We deliberately did not build a calculator for the top-up tax: with the statutory adjustm