This is from the persepctive of a third-country (i.e. not from Hungary or the EU) citizen. And of course, I’m not an immigration or tax professional, so these were just my personal experiences. Although everyone’s situations can differ, I hope this gives you some guidance!
If you’re going to work as a freelancer in Budapest, you’ll need to invoice your clients. Let’s take a look at possible invoicing software and what I include on my invoices.
Once again, this is just info as I understand it, but I am not a tax professional. For clarity, I suggest speaking to an accountant or other tax professional.
Which invoicing software to use?
I use Online Szamla because it is the official invoicing software of NAV, so I don’t have to take any extra steps to link the information. The software has a fully translated English section, so it is straightforward to use.
Other popular ones I’ve heard of are Számlázz.hu and Billingo. However, the tax information must be linked to NAV (although I believe they have services to do that for you).
What’s required on an invoice?
I provide my business tax number, my address, and I check the box that refelcts that I am a “sole entrepreneur”.
I put their business tax number (if invoicing an individual i.e. a private student, I don’t believe a tax number is required) and address.
Which tax percentage do I choose?
Normally, invoices add 27% VAT. Through the KATA system, I pay all of my taxes through the monthly 50,000 transfer and so don’t have to pay the additional 27%. To reflect this on the invoice, I select “AAM”, which is the personal tax exemption.
My problem:
There was a period when the system wouldn’t let me in. I found out that this was because my information (mother’s maiden name) didn’t match in the system (just like what happened when establishing my business). I had to go to the closest NAV office and have them change it in the system manually.
I thought that invoicing would be intimidating, but I was relieved to find that it was pretty straightforward! Want to know more?
What is the KATA system?
Getting a Freelancer’s Visa
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