What is commuting cost reimbursement in Hungary?
Commuting cost reimbursement (munkába járás költségtérítése) is the contribution Hungarian employers make to employees’ travel between home and work. Government Decree 39 of 2010 makes it compulsory for employees who commute from outside the town or city where they work, and the personal income tax act sets how much of it is tax-free.
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For daily commuting by train (second class), scheduled bus, suburban railway (HÉV), boat or ferry, the employer must refund at least 86% of the price of the pass or ticket, against the ticket itself or an electronic invoice. The same 86% applies to trips home, up to once a week, for employees who stay near the workplace, subject to a monthly cap that is updated each year. Local public transport within the town is not covered, except for changing there on the way.
Commuting by car
An employee who commutes by car is entitled to a mileage allowance instead if there is no public transport between home and work, if their working hours rule out public transport or mean long waits, if a disability prevents them from using it, or if they have a child in nursery or under ten in school. The compulsory amount is 60% of the tax-free rate of HUF 30 per kilometre of the round trip, or HUF 18 per kilometre, and the employer can choose to pay up to the full HUF 30.
Tax treatment
Ticket refunds up to the price of the ticket, and mileage allowances up to HUF 30 per kilometre, are not taxable income. Anything above those limits is taxed as employment income. When they claim, employees must declare where they live and stay, and whether they commute from their home or a temporary address.
Commuting allowances when TopSource runs your payroll
When TopSource runs your payroll in Hungary, we collect employees’ declarations and tickets, pay the refunds or mileage allowances with salary and keep them within the tax-free limits.
Frequently asked questions
How much of a commuter’s ticket must a Hungarian employer pay?
At least 86% of the price of the pass or ticket for daily commuting from outside the town where the employee works, and for weekly trips home within a monthly cap.
Is commuting by car reimbursed in Hungary?
Where public transport is not a realistic option, or the employee has a disability or a young child, the employer must pay at least HUF 18 per kilometre of the round trip, and can pay up to HUF 30 tax-free.
Is the commuting allowance taxable in Hungary?
Not within the limits: the ticket price for public transport and up to HUF 30 per kilometre for other commuting. Amounts above that are taxed as employment income.
Related terms in Hungary
- Written Employment Information (Hungary)
- Fixed-Term Employment Limits (Hungary)
- Simplified Employment (Hungary)
- Overtime Cap (Hungary)
- Telework and Home Office Rules (Hungary)
- Additional Leave (Hungary)
- Protected Periods and Dismissal Justification (Hungary)
- Termination by Mutual Agreement (Hungary)
- Non-Compete Agreement (Hungary)
- Works Council and Collective Agreements (Hungary)
- Guest Worker Permit and Single Permit (Hungary)
- Occupational Safety and Medical Aptitude Exam (Hungary)
- KATA and Contractor Misclassification (Hungary)
- Overtime Premium (Hungary)
- Shift and Night Work Supplements (Hungary)