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Wage support 4.0: additional industries, increased wage support and advance payment

The rules for wage support were amended at the same time as the restrictive measures were introduced in response to the COVID-19 pandemic: additional industries have been added to the wage support scheme, and the advance payment of the support has become available, resulting in potential cash flow benefits for employers. Here are the most important dates and deadlines.

Increased wage support cap

Support of up to 50 percent of the gross wage of persons employed in the form of an employment relationship may be granted to companies that were adversely affected by the restrictions, up to a gross amount of HUF 241,500 per month (a gross amount of HUF 251,100 per month after 1 February 2021 as a result of the increase in the minimum wage),provided that the employer:

  • pays the wage to the employee, and
  • agrees not to terminate the employment relationship by giving notice or by mutual agreement before 30 April 2021.

It is important to keep in mind that employers may also apply for an increase of the previously awarded amount of the support for the period after 1 February 2021, but the amended employment contract must also be submitted.

More employees eligible for wage support

Pursuant to the most recent amendments dated 6 March 2021, employers may apply for wage support for employees working in the following additional industries affected by the restrictions (shutdown) until the end of March

  • Other retail sales in non-specialized stores (TEÁOR 4719),
  • Retail sale of audio and video equipment in specialized stores (TEÁOR 4743),
  • Retail sale of textiles in specialized stores (TEÁOR 4751),
  • Retail sale of electrical household appliances in specialized stores (TEÁOR 4754),
  • Retail sale of furniture, lighting equipment, and other household articles in specialized stores (TEÁOR 4759),
  • Retail sale of books in specialised stores (TEÁOR 4761),
  • Retail sale of paper, stationery and office supplies in specialized stores (TEÁOR 476203),
  • Retail sale of music and video recordings in specialised stores (TEÁOR 4763),
  • Retail sale of sporting equipment in specialised stores (TEÁOR 4764),
  • Retail sale of games and toys in specialised stores (TEÁOR 4765),
  • Retail sale of clothing in specialised stores (TEÁOR 4771),
  • Retail sale of footwear and leather goods in specialised stores (TEÁOR 4772),
  • Retail sale of watches and jewellery in specialised stores (TEÁOR 4777),
  • Other retail sale of new goods in specialised stores (TEÁOR 4778),
  • Retail sale of second-hand goods in stores (TEÁOR 4779),
  • Renting of video tapes and disks (TEÁOR 7722),
  • Renting and leasing of other personal and household goods (TEÁOR 7729),
  • Other reservation service and related activities (TEÁOR 7990),
  • Gambling and betting activities (TEÁOR 9200),with the exception of tote betting and lottery shops,
  • Repair of consumer electronics (TEÁOR 9521),
  • Repair of footwear and leather goods (TEÁOR 9523),
  • Repair of furniture and home furnishings (TEÁOR 9524),
  • Repair of watches, clocks and jewellery (TEÁOR 9525),
  • Repair of other personal and household goods (TEÁOR 9529),
  • Hairdressing and other beauty treatment (TEÁOR 9602),
  • Other personal service activities n.e.c. (TEÁOR 9609),
  • Retail sale of flowers, wreaths and ornamental plants (TEÁOR 477601),
  • Other food service activities (TEÁOR 5629) in the case of businesses operating in education institutions,
  • Driving school activities (TEÁOR 8553),
  • Other education n.e.c. (TEÁOR 8559),or
  • Educational support activities (TEÁOR 8560).

Those working in the above industries continue to be eligible for wage support only if the activity for which support is claimed qualifies as the core activity of their respective employers. The actual core activity is deemed to be the activity from which the payer or small business earned most of his income (but at least 30 per cent of his income) during the six months preceding 11 November 2020.

Advance payment of wage support

The method of payment of the support in the industry wage support scheme has changed. Since 3 February 2021, employers have been receiving their monthly support from government offices as an advance instead of subsequent payment (after the accounts for the current month are prepared). However, the requirement that employers must subsequently file their calculation sheets is still in place.

Temporary suspension of the fixed-rate tax of low tax-bracket enterprises (KATA) and social contribution tax

Another important provision of the government decree is that entities and entrepreneurs in the KATA scheme and sole entrepreneurs who are subject to the Personal Income Tax Act are exempted from their KATA and social contribution tax liability for the month of March.

Relief from rent payment

Pursuant to an amendment to a related regulation (Government Decree No. 52/2021),those active in the industries covered by the wage support scheme do not have to pay rent in March for real estate owned by the state or the local government. Any rent already paid is refundable until 16 March. 

Make sure you don't miss any of the deadlines for wage support!

  1. For newly included industries
    Submission of the request for wage support: 31 March 2021
    Basis of the request for wage support: the gross wage specified in the employment contract effective on 5 March 2021
  2. For industries already supported
    Submission of the request for wage support: 10 April 2021
    Basis of the request for wage support: the gross wage specified in the employment contract effective on 10 November 2020
    For previously submitted requests, the period for which support is granted is automatically extended to include the month of March, except if the employer applying for support waives such support for the extended period by submitting a declaration to that end.
  3. Special rules for accommodation providers
    Submission of the request for wage support: 10 April 2021
    Basis of the request for wage support: the gross wage specified in the employment contract effective on 9 December 2020
    Entities affected: TEÁOR 5510, TEÁOR 5520, TEÁOR 5530 and TEÁOR 5590.

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Sourse: The wage support scheme is regulated by Government Decree No. 485/2020 (XI. 10.).
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