Sign up for tax alert emails    GTNU homepage    Tax newsroom    Email document    Print document    Download document

December 18, 2023

Hungary offers capital gains tax amnesty for shares that previously didn't qualify

  • The latest year-end tax legislation enacted in Hungary includes a one-time amnesty for capital gains on shares in subsidiaries that had not previously opted in to the Hungarian capital gains exemption regime.
  • The "price of amnesty" would be a one-time cash tax payment amounting to 1.8% of the gains (if any) accumulated between the original acquisition date and 31 December 2023.

Newly enacted tax legislation in Hungary includes a one-time amnesty for capital gains on shares in subsidiaries that had not previously opted in to the Hungarian capital gains exemption regime.


The Hungarian capital gains exemption regime is optional. Opting in requires reporting the acquisition of shares to the tax authority within 75 days by submitting the appropriate electronic form. Missing the deadline means that the respective participation would not be eligible for the capital gains exemption in the case of future disposal.

Under the regime, assuming that the election was made within the 75-day period, capital gains from the sale and in-kind contribution of shares is exempt after a one-year holding period. The current regime does not apply any minimum shareholding requirement.

There could be several reasons why a multinational with holding functions in Hungary did not opt in to the capital gains exemption regime for certain participations — e.g., the regime was not available at the time of the acquisition or the participation percentage was below certain thresholds that used to apply.

Details of the one-time amnesty

Under the year-end tax bill, taxpayers with shares that currently do not qualify for the exemption now have the opportunity to make the election by submitting the respective form with the tax authority, As a result, their shares would become eligible for the regime. The deemed election date would be 31 December 2023. The conditions of the one-time amnesty are as follows:

  • 20% of the positive difference between the fair market value and the book value of the shares on 31 December 2023 would be taxed at 9%; i.e., the cost of amnesty is a cash tax payment in an amount of 1.8% of the capital gains (if any) until 31 December 2023
  • The filing could be made until the filing deadline of the corporate income tax return of 2023 (i.e., 31 May 2024 for calendar-year taxpayers)
  • Third-party valuation will be required

The final legislation, as enacted, offers the amnesty for every company in Hungary, whether or not the group is subject to the Organisation for Economic Co-operation and Development's (OECD's) Pillar Two.

Key takeaway: This one-time opportunity is available for all Hungarian companies with shares not currently eligible for capital gains exemption. The respective considerations should be analyzed before making a decision on the election.


For additional information with respect to this Alert, please contact the following:

Ernst & Young LLP (United States), Hungarian Tax Desk, New York

Ernst & Young Consulting Ltd., Hungary (Budapest)

Published by NTD’s Tax Technical Knowledge Services group; Carolyn Wright, legal editor


The information contained herein is general in nature and is not intended, and should not be construed, as legal, accounting or tax advice or opinion provided by Ernst & Young LLP to the reader. The reader also is cautioned that this material may not be applicable to, or suitable for, the reader's specific circumstances or needs, and may require consideration of non-tax and other tax factors if any action is to be contemplated. The reader should contact his or her Ernst & Young LLP or other tax professional prior to taking any action based upon this information. Ernst & Young LLP assumes no obligation to inform the reader of any changes in tax laws or other factors that could affect the information contained herein.


Copyright © 2024, Ernst & Young LLP.


All rights reserved. No part of this document may be reproduced, retransmitted or otherwise redistributed in any form or by any means, electronic or mechanical, including by photocopying, facsimile transmission, recording, rekeying, or using any information storage and retrieval system, without written permission from Ernst & Young LLP.


Any U.S. tax advice contained herein was not intended or written to be used, and cannot be used, by the recipient for the purpose of avoiding penalties that may be imposed under the Internal Revenue Code or applicable state or local tax law provisions.


"EY" refers to the global organisation, and may refer to one or more, of the member firms of Ernst & Young Global Limited, each of which is a separate legal entity. Ernst & Young Global Limited, a UK company limited by guarantee, does not provide services to clients.


Privacy  |  Cookies  |  BCR  |  Legal  |  Global Code of Conduct Opt out of all email from EY Global Limited.


Cookie Settings

This site uses cookies to provide you with a personalized browsing experience and allows us to understand more about you. More information on the cookies we use can be found here. By clicking 'Yes, I accept' you agree and consent to our use of cookies. More information on what these cookies are and how we use them, including how you can manage them, is outlined in our Privacy Notice. Please note that your decision to decline the use of cookies is limited to this site only, and not in relation to other EY sites or Please refer to the privacy notice/policy on these sites for more information.

Yes, I accept         Find out more