Hungary Per Diem

Employees are entitled to reimbursement of their increased costs on a business trip, such as meals. This is based on the requirement set out in Section 51(2) of the Labor Code, which states that employers are obliged to reimburse employees for the costs reasonably incurred during the performance of the employment relationship.

Employers can choose between two methods of providing this allowance for business trips within Hungary. They can opt for a flat-rate daily allowance (per diem), which is then treated as taxable income for the employee. Alternatively, employers can reimburse based on actual costs incurred, proven by receipts from the employee during the trip. There are no restrictions on the amount employers can contribute toward these per diems.

Government Decree 437/2015 5XII. 28 states that the standard daily allowance for these purposes is at least HUF 500.

Employees are not entitled to a per diem if the employee spends less than 6 hours on the business trip on that day and/or the employer provides food for the employee during their journey.

Since 30 March 2023 (Government Order 96/2023), the daily allowance for employees working as drivers or cargo attendants in domestic road freight transport and passenger transport has been set at HUF 9000.

Regarding international business trips, no predefined minimum amount is set by legislation. Instead, it’s up to the employer to determine the allowance. However, when paying out a per diem without the employee providing proof of the incurred expenses, there is a tax consideration: only 30% of the meal allowance value is non-taxable, with a maximum cap of EUR 15 per day. Additionally, no daily allowance is granted for trips lasting less than 8 hours during a day. This is defined in Government Decree 285/2011. (XII. 22.).

Example: An employee travels to London from 5 March at 6 am to 16 March at 3 pm, and the daily allowance is EUR 20. Tax regulations dictate that 30% or EUR 6 can be accounted for as an expense without proof. Any amount exceeding the tax-free threshold is subject to taxation according to income tax rates.

Since 30 March 2023 (Government Order 96/2023), the daily allowance for employees working as drivers or cargo attendants in international road freight transport and passenger transport has been set at EUR 85.

Employers have a choice in how they convert foreign allowances. They can either use the exchange rate of the National Bank of Hungary up to the 15th day of the previous month when the settlement is paid or opt for the average exchange rate valid up to the day before the settlement is paid.