Hi there, I'm new to this site and I was wondering if anyone knows of a good accountant in Budapest, as I have an apartment over there which was rented out for a couple of months last year. I presume that I am now liable for tax on the profits ( which aren't very much at present). Any advice on the whole property abroad situation would great.
Budapest Accountant
- Thread starter walsh101
- Start date
H
Hungary
Guest
If you applied for tax number and tax card to Hungarian Tax Authority (APEH), you are liable for tax on rent income. Otherwise, all rent is "black money". Avoding unexpected surprise I suggest you clarify your tax position in Hungary. Application process takes approx. 30 business days.
Dealing with tax return is a simple job. March-April is the period of tax return:
- apply for tax number (application form to Tax authority): 14 days
- as soon as tax number is given you will apply for tax card (applicaton form to Tax authority): 14 days
- then you will be able to purchase an receipt book and provide invoice
- personal income tax is to be paid monthly directly to tax authority(13th of next month, tax of january is to be paid until 13th Februraty, for instance)
-payment can be taken place by landlord or tenant but it should be clarified in the rental agreement in advance
- corporate tenants prefer paying tax while individual tenants ,student for instance, let landlord pay tax
- therefore, received monhtly rent can be net or gross
- there are some other specifications regarding personal income tax in Hungary such health care contribution and options of how to manage tax return.
For any advice please contact me.
All the best
Dealing with tax return is a simple job. March-April is the period of tax return:
- apply for tax number (application form to Tax authority): 14 days
- as soon as tax number is given you will apply for tax card (applicaton form to Tax authority): 14 days
- then you will be able to purchase an receipt book and provide invoice
- personal income tax is to be paid monthly directly to tax authority(13th of next month, tax of january is to be paid until 13th Februraty, for instance)
-payment can be taken place by landlord or tenant but it should be clarified in the rental agreement in advance
- corporate tenants prefer paying tax while individual tenants ,student for instance, let landlord pay tax
- therefore, received monhtly rent can be net or gross
- there are some other specifications regarding personal income tax in Hungary such health care contribution and options of how to manage tax return.
For any advice please contact me.
All the best
Hi Walsh101,
Yes, I can recommend a good accountant in Budapest. His name is Peter Kovacs of Sananna Accounting and Consulting. You don't say whether you are letting property as an individual or as a company (Kft). Peter will look after you: he is proactive, and a great communicator. If you want to PM me, I can send you his details.
Yes, I can recommend a good accountant in Budapest. His name is Peter Kovacs of Sananna Accounting and Consulting. You don't say whether you are letting property as an individual or as a company (Kft). Peter will look after you: he is proactive, and a great communicator. If you want to PM me, I can send you his details.
H
Hungary
Guest
He must be an individual, otherwise, tax return would not be an issue. Corporate owners does not have to pay any direct tax on residential property. In this case, 0% of VAT included in the issued invoice the company provides the tenant whether it is an individual or a company.
Thanks to everyone who replied to my query, I must say I'm impressed with this site. Just to clarify the situation I'm renting my apartment as an individual and I already have a tax number which was obtained for me when I purchased my apartment with an Irish company, although they were also to supply an accountant but so far no word and I don't want to leave everything on the long finger and find I owe a fortune.
I've heard good reports about a guy called Laci Kovacs, who Tower Budapest recommended. As far as I know, he charges around €250-300 per year for a full accountancy service. Finding a good trustworthy accountant in Hungary is just as difficult as it is in Ireland. I also have other contacts who can provide a much cheaper service, if all you need is to file a simple tax return. You can PM me if you need further details, as I would have to check with them first.
You will be liable to pay tax in Hungary on the rental income at 25%.
You will be liable to pay tax in Hungary on the rental income at 25%.
H
Hungary
Guest
Tax return for an individual in Hungary is a very simple job especially if you have no other personal income on top of that. Hungarians usually do not use accountant for managing tax return. Because of language barriers, you need assistance but it should not be overpaid. 30-40 Euro per apartment is more reasonable price because this not an regular work. Tax return is required to be done once a year. Issuing invoices would be done by management company. Accountant would need the 12 issued invoices only. Tax can be paid by direct debit if owner is liable to arrange tax payment monthly. Otherwise, corporate tenant gives a certification of paid tax by Tax authority.
Budapest, please give a better and more attractive picture about potential expenses for investors who are interested in Hungary.
Investors should not be ripped off just because they are foreigner. I suggest you have a look at accountant market before making suggestions.
No offense but overpricing is a bad habit in Budapest.
Budapest, please give a better and more attractive picture about potential expenses for investors who are interested in Hungary.
Investors should not be ripped off just because they are foreigner. I suggest you have a look at accountant market before making suggestions.
No offense but overpricing is a bad habit in Budapest.
I'm not sure what you mean about giving a more 'attractive' picture about the need to have a good Hungarian accountant on your side. I don't think that €250-€300 per year is too much to pay for this, particularly when you consider that there can be many other expenses involved, such as renovation, etc, which can be potentially taken away from the CGT figure down the line. For an investor who isn't aware of the Hungarian tax system, a good accountant is worth paying for, in my opinion, particularly during the first year. It is not just about making annual returns for rental income.
H
Hungary
Guest
I do not want to go into argument with you but effective accountant service for reasonable price is available in Budapest. Dealing with invoices is a simple job honestly. If you are an individual tax return is not concerned about renovation, fitout, management because there is no deductable cost in Hungary. However, re-sale process is affected by your expenses during ownership period. Honestly, how many times you renovate an apartment during ownership period? Probably once. I think a simple calculation need to get final figure in terms of taxation. Further to that, you do not have to pay high charge just because you want to sale it within 5-10 years. Extra charge should mean extra work, shouldn't it.
No matter why I am concerned with your advice but Budapest is overpriced in sales and after sale services.
500 Euro is the avarage monthly salary in Budapest. Please note that 300 Euro sounds extremly high. You do not have to pay Irish price in Budapest if you are not willing to do.
Renting issue is another story. This is not the thread it needs to be discussed. But good yield is available if you invest properly and pay more attention to small details. I am talking about high standard furnishd apartment with beautiful design and decor and modern kitchen. Please do not use avarage yields and renting potentials in an extremly segregated market like Budapest renting market. Please calculate expected monthly rent if achiveable max. yield is around 8%. Purchasing price + car parking, AC, etc. High yield is reached if interior design satify high needs, therefore, fitout cost would be over 10K for a one bed.
No offence and apologies if any hurt.
No matter why I am concerned with your advice but Budapest is overpriced in sales and after sale services.
500 Euro is the avarage monthly salary in Budapest. Please note that 300 Euro sounds extremly high. You do not have to pay Irish price in Budapest if you are not willing to do.
Renting issue is another story. This is not the thread it needs to be discussed. But good yield is available if you invest properly and pay more attention to small details. I am talking about high standard furnishd apartment with beautiful design and decor and modern kitchen. Please do not use avarage yields and renting potentials in an extremly segregated market like Budapest renting market. Please calculate expected monthly rent if achiveable max. yield is around 8%. Purchasing price + car parking, AC, etc. High yield is reached if interior design satify high needs, therefore, fitout cost would be over 10K for a one bed.
No offence and apologies if any hurt.
I'd be more than happy to hear any further recommendations of good accountants, Hungary.
Experienced financial professionals can earn good salaries in Budapest, certainly much more than €500 per month. I don't think that €250 is too much for a full year's work, particularly if an investor needs more than just filing of tax returns. I'm sure the cost would be less if this is all that's required.
Experienced financial professionals can earn good salaries in Budapest, certainly much more than €500 per month. I don't think that €250 is too much for a full year's work, particularly if an investor needs more than just filing of tax returns. I'm sure the cost would be less if this is all that's required.
H
Hungary
Guest
I did not say €250 is too much for accountant service. I said it can be significantly cheaper if necessary. You can pay whatever you want but better deal is always better. Budapest is not a simple cake, please. You can save money and you can earn more if you have good and reliable business partners.
If you are a lucky experienced accountant, probably will earn €700 a month in Budapest. I am not talking about financial experts who work for PriceWatershouseCoopers or KPMG and Deoilette. These companies are not recommended for individual investors.
As yield and return can be higher than you expect so charges and expenses can be lower you had thought before.
But higher yield needs higher capital investment. Spend more for apartment instead of paying high mangament and accountant fees
Best of luck
If you are a lucky experienced accountant, probably will earn €700 a month in Budapest. I am not talking about financial experts who work for PriceWatershouseCoopers or KPMG and Deoilette. These companies are not recommended for individual investors.
As yield and return can be higher than you expect so charges and expenses can be lower you had thought before.
But higher yield needs higher capital investment. Spend more for apartment instead of paying high mangament and accountant fees
Best of luck
Hi All,
I bought a renovated apartment in Budapest 2004 ,district 6 , Sziv St. 80m, for 76000euro.
I have it rented for 400 euro a month. I have an accountant who has applied for a tax number but no reply as yet. Did i get value for money at the time? Anybody any idea what it migth be worth now? I hear property prices have fallen in Budapest. I hope i have not made a bad investment as it was a bit of an inpulsive buy.
Any ideas from the experts?
I bought a renovated apartment in Budapest 2004 ,district 6 , Sziv St. 80m, for 76000euro.
I have it rented for 400 euro a month. I have an accountant who has applied for a tax number but no reply as yet. Did i get value for money at the time? Anybody any idea what it migth be worth now? I hear property prices have fallen in Budapest. I hope i have not made a bad investment as it was a bit of an inpulsive buy.
Any ideas from the experts?
H
Hungary
Guest
Hi pbrosnan,
€76K sounds a reasonable price for a one bed classic apartment in this area of district 6. €400 is also a good return. However, resale price would not be considerably higher than your purchasing price was in 2004. You did not make a bad decision certainly but current classic market is not favourable in terms of resale. Further to that, stable period and slightly dropped in price has been a general trend in normal classic property market in Budapest for 2-3 years.
Condition of classic building is also essential when we are talking about resale and renting potentials. Good condition and nicely renovated classic buildings have more interest so their market price-value is also more attractive for investors.
With regard to tax return, you need to have tax number and tax card. And then receipts/invoices can be provided by your accountant or your management company. Tax is to be paid by you or tenant in each month according to lease agreement. If invoices were not provided, all rent you received would be black money from business. I strongly suggest you clarify current stage with your accountant/management company. It is better if you avoid monkey business.
For further information please contact me.
€76K sounds a reasonable price for a one bed classic apartment in this area of district 6. €400 is also a good return. However, resale price would not be considerably higher than your purchasing price was in 2004. You did not make a bad decision certainly but current classic market is not favourable in terms of resale. Further to that, stable period and slightly dropped in price has been a general trend in normal classic property market in Budapest for 2-3 years.
Condition of classic building is also essential when we are talking about resale and renting potentials. Good condition and nicely renovated classic buildings have more interest so their market price-value is also more attractive for investors.
With regard to tax return, you need to have tax number and tax card. And then receipts/invoices can be provided by your accountant or your management company. Tax is to be paid by you or tenant in each month according to lease agreement. If invoices were not provided, all rent you received would be black money from business. I strongly suggest you clarify current stage with your accountant/management company. It is better if you avoid monkey business.
For further information please contact me.
pbrosnan,
Which part of Sziv is it on i.e. which intersection is it closest to? 6.3% return is good. Sounds like you'll do fine if you stick it out for the long term.
Are there plans to renovate the building or has that been done already? The street is still a building site, with parts of it quite run down, but getting better bit by bit. Several loft conversions are in the process of being constructed, which means more renovated buildings and a nicer atmosphere for the people who live here. I wouldn't recommend buying a new build on this street though. IMO, in this area, you were right to choose an older apartment.
Many prices fell a bit in Budapest in the last two years, which what was inevitable after what was effectively a property bubble around 2003-04, fuelled by foreign investment. There is a lot of unwanted second-hand property for sale at the minute, usually in run-down buildings, which investors would have considered buying 2-3 years ago, but not now. It's hard to sell these but at the same time, it's also difficult to find a good classic apartment worth buying. They rarely even reach the Hungarian market, much less the international one.
You should call your accountant asap to sort our your tax issues! That's what you're paying him for.
Anyway, hope it continues to do well for you!
Which part of Sziv is it on i.e. which intersection is it closest to? 6.3% return is good. Sounds like you'll do fine if you stick it out for the long term.
Are there plans to renovate the building or has that been done already? The street is still a building site, with parts of it quite run down, but getting better bit by bit. Several loft conversions are in the process of being constructed, which means more renovated buildings and a nicer atmosphere for the people who live here. I wouldn't recommend buying a new build on this street though. IMO, in this area, you were right to choose an older apartment.
Many prices fell a bit in Budapest in the last two years, which what was inevitable after what was effectively a property bubble around 2003-04, fuelled by foreign investment. There is a lot of unwanted second-hand property for sale at the minute, usually in run-down buildings, which investors would have considered buying 2-3 years ago, but not now. It's hard to sell these but at the same time, it's also difficult to find a good classic apartment worth buying. They rarely even reach the Hungarian market, much less the international one.
You should call your accountant asap to sort our your tax issues! That's what you're paying him for.
Anyway, hope it continues to do well for you!
Hi All,
Thanks for the replies.The apt. is n.50 sziv st. if that is any help with regard to location. It is on the first floor facing the street. The building has not been renovated. Some minor works have been done but the building needs alot of work. I dont know when it will be done,I think it depends if the residents have the money to do the work. Many of the residents in that building seem to be pensioners, so that may be a problem. While i paid 76k for the apt, it cost me another 12k approx for furniture, legal costs ect, so in total i would say 88k, so that reduces the yield a bit.The lease runs out in April , what is the rental market in that area like at the moment?
Thanks for the replies.The apt. is n.50 sziv st. if that is any help with regard to location. It is on the first floor facing the street. The building has not been renovated. Some minor works have been done but the building needs alot of work. I dont know when it will be done,I think it depends if the residents have the money to do the work. Many of the residents in that building seem to be pensioners, so that may be a problem. While i paid 76k for the apt, it cost me another 12k approx for furniture, legal costs ect, so in total i would say 88k, so that reduces the yield a bit.The lease runs out in April , what is the rental market in that area like at the moment?
I know the building. It needs quite a lot of work, but I think in the long term, your property will come good.
It's unusual for residents to come up with the money to restore a building. Instead, the communally-owned loft space is typically sold and the money used to fix the entire building. Several of the buildings on this street recently sold their attics and are currently being renovated. If you have a good house manager, then he or she will have already investigated the possibility of this.
The new build at No. 52 will be finished soon and it's likely that this part of the street will look much better in a few year's time, when the builders finally leave. (A large new development is likely in the near future in the area to the left of your house and back as far as Rozsa utca.)
If the apartment looks good inside/furnished well and you charge €400 per month, then I don't see why you won't be able to continue renting it out. It's a popular area for students, who don't mind paying 100,000HUF between them. I take it, it's a two bedroom apartment?
As an aside, have you investigated buying a parking space next door in No. 52 or across the road in No. 49? Might be a good idea for the future.
It's unusual for residents to come up with the money to restore a building. Instead, the communally-owned loft space is typically sold and the money used to fix the entire building. Several of the buildings on this street recently sold their attics and are currently being renovated. If you have a good house manager, then he or she will have already investigated the possibility of this.
The new build at No. 52 will be finished soon and it's likely that this part of the street will look much better in a few year's time, when the builders finally leave. (A large new development is likely in the near future in the area to the left of your house and back as far as Rozsa utca.)
If the apartment looks good inside/furnished well and you charge €400 per month, then I don't see why you won't be able to continue renting it out. It's a popular area for students, who don't mind paying 100,000HUF between them. I take it, it's a two bedroom apartment?
As an aside, have you investigated buying a parking space next door in No. 52 or across the road in No. 49? Might be a good idea for the future.
H
Hungary
Guest
Hi pbrosnan,
Prospective Tenants face high oversupply in this area due to new developments. At the moment it is easy to find a furnished one bed apartment in solid IKEA style for 400 Euro.
There is no comparison between new developments and classic buildings but tenenats prefer:
- around 50 sqm one bed apartment
- cheap utitlites/energy
- buildings in nice condition inside out
- elevator
- bright and sunny apartments
- neighbours can be also essential (for instance, students like to rent apartmetns in the same building)
I do not say you will be not capable to let it out again but you will have difficulites in enquiring a new tenant according to current market situation.
In contrast to budapest, I do not suggest you purchase a car parking because it is too expensive. You can rent a car parking for €80-100 a month while purchasing price is around €10-12K.
In your case, renovation of building is more important issue than parking facility. Unless the building is being renovated soon you will more and more difficult to find a tenant and get a reasonable rent.
New developments must have more interest comparing to low standard classic buildings.
At the minute €10 per sqm is achievable rent for a nicely (not solid IKEA style) furnished new build apartment with AC and car parking in Sziv street (between Andrassy and Podmaniczky).
Prospective Tenants face high oversupply in this area due to new developments. At the moment it is easy to find a furnished one bed apartment in solid IKEA style for 400 Euro.
There is no comparison between new developments and classic buildings but tenenats prefer:
- around 50 sqm one bed apartment
- cheap utitlites/energy
- buildings in nice condition inside out
- elevator
- bright and sunny apartments
- neighbours can be also essential (for instance, students like to rent apartmetns in the same building)
I do not say you will be not capable to let it out again but you will have difficulites in enquiring a new tenant according to current market situation.
In contrast to budapest, I do not suggest you purchase a car parking because it is too expensive. You can rent a car parking for €80-100 a month while purchasing price is around €10-12K.
In your case, renovation of building is more important issue than parking facility. Unless the building is being renovated soon you will more and more difficult to find a tenant and get a reasonable rent.
New developments must have more interest comparing to low standard classic buildings.
At the minute €10 per sqm is achievable rent for a nicely (not solid IKEA style) furnished new build apartment with AC and car parking in Sziv street (between Andrassy and Podmaniczky).
But even using your figures, this would give a return of 10% if he were to buy one and rent it out. I'm thinking in terms of 8-10 years down the line and at that stage, when (hopefully) most of the street has been renovated, I think parking will become more of an issue. At the minute, it's possible to buy parking places at slight discounts as, unsurprisingly, developers still haven't managed to sell all of the new apartments on this street. Secure car parking is not essential for student tenants/younger ex-pat professionals, but always a bonus and in 10 years time, I think it will also be more difficult to find a parking space to rent in this area than now. Good deals should be available at the minute on nearby spaces, which developers have been left with.
Has your company rented any new apartments on this street lately? This is double what classic renovated apartments cost and in my experience, students prefer to spend as little money as possible for the best apartment they can get.
H
Hungary
Guest
I recall your posts I remember you talked about habit of using cars in Budapest. Now, you are talking about the opposit. Be consequent please. On one side, car park can be a good advantage for the apartment in terms of renting and re-saleing but also a risk but car parking is not always rented with the apartment. In this case, expected yield is lower and level of risk is high. Again, I do not say it would be a bad decision but pbrosnan needs a renovated building for better return than a risky car space.
I think his apartments is rented by students who do not have a car. Expats prefer new build in this area with our without car parking.
Anyway, I know how the area and building looked like 5-10 years ago. To be honest slow progress has been taken place. Now there are more new developments, a couple of renovated buildings but the most are unchanged.
I do not want to talk about intercorrelation of new build and classic apartments but you should see a classic apartment is a very long term investment in this area of district 6.
Examples for rented apartments in Sziv
- 36 sqm studio apartment without car parking is rented for €360 a month (rented by a student for 12 months, rent is paid monthly)
- 56 sqm one bed apartment with car parking is rented for €660 a month (rented by a hungarian professional for 12 months, 1 year rent is paid in advance)
Both apartments with AC and high standard modern interior design for higher needs and comfort.
This is not the first, and I thing the last time, but interior design and level of comforts are very very essential for tenants.
I think his apartments is rented by students who do not have a car. Expats prefer new build in this area with our without car parking.
Anyway, I know how the area and building looked like 5-10 years ago. To be honest slow progress has been taken place. Now there are more new developments, a couple of renovated buildings but the most are unchanged.
I do not want to talk about intercorrelation of new build and classic apartments but you should see a classic apartment is a very long term investment in this area of district 6.
Examples for rented apartments in Sziv
- 36 sqm studio apartment without car parking is rented for €360 a month (rented by a student for 12 months, rent is paid monthly)
- 56 sqm one bed apartment with car parking is rented for €660 a month (rented by a hungarian professional for 12 months, 1 year rent is paid in advance)
Both apartments with AC and high standard modern interior design for higher needs and comfort.
This is not the first, and I thing the last time, but interior design and level of comforts are very very essential for tenants.
I must say that having looked at the recient posts i am very disappointed ,if not disillusioned about the Budapest property market. It seems that i have certainly have lost money on my investment, noboby seems to know exactly how much. It looks like that i could not even sell the apt now even i wanted to. I will find very difficult to rent it again as there is oversupply in that market also.It is afar cry from the promises of a few years ago telling us that Budapest was the Paris of the east.Now i believe that i will have to pay a property tax on the apt. from 2008 onwards.Does anybody know how much this will be? I have to pay interest on the money borrowed to buy the apt but my rental income is under attack on several fronts.I really need some hope for the future