Hungary's growing economic performance and competitive tax system offer a good business environment for companies from Switzerland, while the presence of Hungarian companies in Switzerland is also growing.
Switzerland is the 9th largest investor in Hungary, and Swiss companies employ around 30,000 people in Hungary. Last year, trade between the two countries exceeded €2 billion. The Hungarian-Swiss double taxation is governed by a bilateral tax treaty signed originally in 1981, and later updated in 2013. With its newest amendment, it will reflect international reforms and economic relations between the two countries will be further strengthened, which is a priority for both sides.
The convention covers taxes on income and wealth and regulates the scope of the taxing rights of each contracting party with respect to each type of income (dividends, interest, royalties, income from self-employment and non-self-employment, etc.) and wealth, thus excluding double taxation of the income and wealth of individuals and companies.
In addition to eliminating double taxation of the income and assets of both individuals and companies, double tax conventions create the possibility for mutual conciliation between the contracting parties and the exchange of information between authorities and contribute significantly to economic whitening. In 2024, Hungary will maintain double tax treaties with around 75 countries, ensuring efficient tax treatment of international business and personal income. However, particular attention should be paid to changes and exceptions that may affect the application of the conventions.
By Denes Glavatity, Associate, KCG Partners Law Firm
