From 2026, the system of development tax credit will change in several respects: the year-end governmental decree introduces tighter rules, new exclusion criteria, and significantly increased administrative requirements at the same time. The detailed rules of the tax incentive aligned with the CISAF, available under “clean industrial technologies,” have also been published, while notification obligations and data-reporting requirements in the corporate income tax (CIT) return are expanding as well. We have summarized what to pay attention to when planning investments and preparing the related documentations.
Development tax credit 2026: what changes does the year-end tax law change bring?
From 2026, the development tax incentive regime will change in several respects, based on the regulation adopted at the end of 2025 that comprehensively amends the rules in respect of development tax credit. The new framework goes beyond mere technical clarifications: the amendments introduce stricter requirements and increased administrative burdens, while at the same time setting out the detailed rules of strategic importance support title. Overall, the legislative message is clear: in the future, investments intended to benefit from development tax incentives will need to be planned with greater care, supported by prior compliance assessments and precise, well-structured documentations.
The TCTF-Based Development Tax Incentive Is Being Phased Out, CISAF Takes Over: A New ‘Clean Industrial’ Legal Basis
The previous, so-called temporary development tax credit was available to Hungarian tax payers within the framework of the European state aid framework called “TCTF” (Temporary Crisis and Transition Framework). The aim of TCTF was to facilitate the green transition by applying special temporary rules. In 2025, the TCTF framework was replaced by the CISAF (Clean Industrial State Aid Framework), a framework to support low-carbon, mainly renewable energy sources (e.g. solar, wind energy), and thus industrial decarbonization.
In line with the above, TCTF-based support schemes ceased to exist as of 31 December 2025, and were replaced by rules based on the CISAF (clean industry) framework. The relevant regulatory framework had already been developed earlier in the year in connection with other state aid types, such as VIP cash grant (EKD); however, in the case of development tax credit, the new title/category was introduced only at the last moment. Accordingly, not only the list of legal titles under the Corporate Income Tax Act (CIT Act) was amended, but the related detailed provisions were also incorporated into the Development Tax Credit Government Decree during the year-end legislative changes. The clean-industry related tax incentive may be claimed until 2030 at the latest.
Conditions of the CISAF Tax Incentive: What Needs to Be Met in Practice?
If the total amount of state aid claimed for the given investment, calculated at present value, does not exceed EUR 150 million in Budapest or EUR 350 million outside Budapest, the registration of the tax incentive is registered by the ministry based on the notification form submitted. Above these thresholds, a resolution is issued on the basis of the the European Commission’s approval is required.
A condition for claiming the tax credit is that, in carrying out the activity resulting from the investment, the taxpayer uses the most advanced production technology commercially available in terms of environmental emissions. At the same time, the activity must not lead to the displacement, within the territory of the European Union, of existing production capacity or future production capacity which has already been contractually committed.
A further condition is that the tax incentive may be granted only in respect of an investment that, in the absence of state aid, would be implemented outside the territory of an EEA Member State; the taxpayer must also be able to prove this circumstance.
The maximum amount of the tax incentive is 15% of the eligible costs in the case of investments to be carried out in Budapest, and 35% in the case of investments outside Budapest (these ratios may be increased by 20 percentage points for small enterprises and by 10 percentage points for medium-sized enterprises).
The new CISAF-based state aid scheme replaces the former transitional development tax incentive available under the TCTF framework; however, it operates under its own, broader conditions and rules. In addition to the strict EU compliance requirements, detailed preliminary data reporting becomes mandatory, meaning that thorough and careful preparation is essential in order to claim the tax incentive.
Excluded Investments from 2026: Energy Sector and Residential Real Estate Development
Even under the previous rules, development tax credit could not be claimed in connection with investments aimed at energy production, energy supply or the establishment of energy-related infrastructure, even where such investments served to meet the taxpayer’s own energy needs. Accounting Question No. 35/2020 had already stated that, in this context, companies must examine whether the activities they intend to carry out as a result of the investment fall under NACE (TEÁOR’25) code 35.
The current amendment clarifies this exclusion rule: under NACE (TEÁOR’25), no tax incentive may be claimed in connection with investments falling within Code 35, covering energy generation, energy storage, energy transmission, energy distribution, and the establishment of energy-related infrastructure, even if the investment serves exclusively to meet the applicant’s own energy needs.
In addition to clarifying the above exclusion relating to the energy sector, the legislator expressly excludes from the eligible costs the acquisition value of assets which, under TEÁOR’25, serve energy production or energy supply activities falling within Code 35.
As a new element, no tax incentive may be claimed in respect of investments aimed at residential buildings or apartments intended for sale or for lease on the market.
Changes to CIT Return Data Reporting Requirements
Claiming the development tax credit has already involved extensive and highly detailed documentation obligations, and unfortunately this will not change in the future. The legislator has slightly amended the scope of these requirements, meaning that companies will now be required to establish and maintain an even more detailed record-keeping structure — over a period of several years.
Changes have also been introduced to the data reporting requirements in the corporate income tax return. Companies are now required to provide data in the CIT return starting from the year of notification. This reporting obligation remains in force until the final year of the tax incentive, regardless of whether the incentive is actually utilized in a given year. Taxpayers must include detailed, investment-by-investment information in the CIT return and must also declare the status and exact date of putting the given investment into operation. The preparation of the related present value calculations, state aid cumulation data, and specific analytics (such as those relating to headcount or personnel-related costs) may require substantial preparatory work for many companies.
Companies intending to claim the development tax credit are advised to implement a well-structured and transparent records, analytical breakdowns and calculations already at the application stage, as this can significantly facilitate not only the preparation of the notification or application, but also the ongoing compliance and reporting obligations as well.
Tax Audit Risk: What Can Taxpayers Claiming the Development Tax Incentive Expect?
In addition, it should also be highlighted that the tax authority will carry out a tax audit at least once by the end of the third tax year following the first utilization of the tax incentive.
