Variations of fringe benefits (Cafeteria) from 2020

Dear Clients! Dear Readers!

The Hungarian Parliament has implemented radical changes in the fringe benefits system as of year 2019.

In our newsletter we will give you an overview of the remaining fringe benefit elements and their tax rates applicable in year 2020.

Day-nursary or kindergarten services provided free of charge or at a discount (non-cash benefit) will be tax exempted also in year 2020

The service fee of kindergarten, nursery can be reimbursed upon invoice issued to the employer or the private individual (employee).

SZÉP-card will remain a kind of fringe benefit – employer’s tax burden 32.50%

Payments to the SZÉP card’s sub-accounts up to the actual thresholds (accommodation: HUF 225,000, catering: HUF 150,000, leisure-time services: HUF 75,000) will be available in 2020, too.

The employer has to pay 32.50% tax in 2020 (34.5% till July 2019) if the value of the two fringe benefits mentioned above does not exceed the annual recreational framework amount, which is HUF 450,000 (HUF 200,000 in public sector).

“Certain specific benefits” will remain – employer’s tax burden 38.35%

For any benefit given to private individuals over the threshold applicable to the SZÉP Card’s sub-accounts or the annual framework amount (HUF 450,000 or 200,000), the employer has to pay a total tax of 38.35%.

Please find the list of fringe benefits from 2020 compared to year 2019.

We hope that the overview above can support you in your decisions regarding cafeteria benefits 2020. Our colleagues will be pleased to help you in interpreting the rules detailed above.

Kind regards,

ABT Treuhand Group