Investors who want to open a cryptocurrency company in Hungary have to take into consideration few aspects. One of the most important matters is that cryptocurrency is not considered yet a legal tender.
However, the Hungarian authorities are actively working at creating a suitable legal environment that can regulate cryptocurrency activities, as well as to protect the interests of those who invest in this type of currency.
Are there any tax rules on cryptocurrency in Hungary?
Yes, even though the field is not fully regulated, as mentioned above, the local authorities constantly create new rules along with the associations that promote this industry, as it is the Blockchain Hungary Association.
Although there isn’t a clear law regulating this sector, there are some tax regulations applicable to blockchain operations that were recently created.
Furthermore, the Hungarian authorities
also reduced the level of taxation
for cryptocurrency operators
, in an attempt to increase the interest of investors and users.
Local and foreign investors who want to open a cryptocurrency company in Hungary should know the following with regards to the taxation of this industry:
• cryptocurrency is currently taxed at a rate of 15% (personal income tax);
• this tax is charged on the profits obtained from this activity, and the current rate of 15% was reduced from 30,5%;
• those who will gain profits from cryptocurrency in 2022 are required to submit tax returns;
• the deadline to submit the tax return following the new taxation rules is May 2023;
• some of the cryptocurrency operations are entitled to a tax amnesty for a period of 5 years.
How are cryptocurrencies defined in Hungary?
Investors who want to start a business
in this sector or to obtain a crypto license in Hungary
must know that this activity has recently received a statutory definition, recognized under the Hungarian law
The definition has been established under the Crypto Asset Regulation (the draft document), which stipulates that cryptocurrency refers to digital tokens that have a value and that can be transferred or stored with the assistance of digital technology.
Such technology is defined as shared ledger technology. Currently, most of the persons who are using cryptocurrency in Hungary are individuals, and this is why the local institutions aim at creating tax laws regarding personal income taxation.
Why open a cryptocurrency company in Hungary?
Although the business activities related to cryptocurrency are less developed, at the moment, there are few blockchain startups operating in this country.
So, foreign investors who want to open a cryptocurrency company in Hungary will find certain opportunities on this market; Hungary has cryptocurrency businesses that were founded in 2016-2017.
It must also be noted that the country is a member of the European Blockchain Partnership
and also applies the AMLD 5 (the Anti-Money Laundering Directive V – Directive (EU) 2018/843)
The most important advantage is given by the level of taxation – a tax of only 15%, lowered in 2022 from 30,5% to stimulate investments in this market.
Our team can also present information on whether your business will need a crypto license in Hungary
, based on the latest legal procedures. Contact our consultants
for consultancy services regarding this subject.