The Government grants a personal income tax exemption to mothers under 30 years of age for the duration of the state of emergency declared in view of the conflict in Ukraine. Details of the tax exemption were set out in Government Decree 596/2022 (XII.28.) of 28 December 2022 (the Decree).

According to the Decree, during the period of an emergency situation under Government Decree 424/2022 (X. 28.), a young mother under the age of 30 who has a child may reduce her consolidated tax base under Act CXVII of 1995 on Personal Income Tax with the tax benefit for young mothers under the age of 30. The benefit for mothers under 30 is available after the benefit for mothers of four or more children and after the benefit for young people under 25, but before the personal allowance, the first-married couples’ allowance and the family allowance.

For the purposes of the Decree, a young mother is a person whose entitlement to family allowances in respect of her unborn child, a child born to her by blood or an adopted child opens on the day before she reaches the age of 30.

A young mother who is entitled to the family allowance in respect of her biological or adopted child or her unborn child, as defined in the Income Tax Act, is entitled to the allowance.

The benefit is based on the following items which are part of the consolidated tax base earned by the young mother in the months of entitlement:

  • income classified as salary under Section 3 Subsection (21) of the Income Tax Act,
  • the sum of his/her income from activities other than self-employment, not referred to in the previous point, excluding any amount of severance pay received in respect of termination of employment in excess of the statutory amount,
  • from the income of self-employment
    • the entrepreneurial payment of a private entrepreneur applying taxation of entrepreneurial income, or, in the case of flat-rate taxation, his or her income determined on a flat-rate basis;
    • the income of a licensed small-scale producer earned from this activity;
    • the income of a Member of the European Parliament earned from this activity;
    • the income of a local government representative earned from this activity;
    • the income of an elected auditor earned from such activity;
    • the income of a private individual earned from his/her activity pursued under another type of contract concluded with the aim of performing work for remuneration but not as a private entrepreneur,

but not more than the number of months of entitlement per tax year multiplied by the average gross earnings of full-time employees at the national economy level for the month of July of the year preceding the tax year in question, as officially published by the Central Statistical Office. This is HUF 499,952 per month of entitlement in 2023.

Income above the threshold and all other taxable income remains taxable.

In order to claim the benefit for young mothers, the beneficiary must make a tax-advance declaration to the party responsible for the assessment of the tax advance.

If the entitlement no longer exists for some reason, the declaration must be withdrawn, because in the absence of withdrawal, a 12% differential penalty will be imposed on the resulting payment shortfall in the tax return for the tax year if the shortfall exceeds HUF 10,000.

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