27 April 2023
Employment Tax
Impact: High
Summary
The SZÉP card in Hungary, is a popular method for employers to reward employees – credit on SZÉP cards can be used for recreational activities, meals and other fringe benefits.
From 31 May 2023 service providers can deduct up to 15% from the values contained on individual’s SZÉP cards in certain scenarios. This bulletin provides details of these upcoming changes.
The detail
Amounts credited to SZÉP cards before 15 October 2022 can be used free of charge until 31 May 2023. From this date on, the service provider will charge a one-time fee of 15% for any unused amount still on the card, thus reducing the value on the card that can be freely spent.
Amounts credited to SZÉP cards after 15 October 2022 can be used free of charge for one year, after that they will be charged 15%. The earliest this reduction can be applied by the vendor is 20 March 2024.
Prior to this change, SZÉP cardholders could use the amount transferred to the SZÉP card free of charge until 31 May of the second calendar year following the transfer (after that, the service provider could charge a 3% fee).
With this step the government is trying to encourage card holders to spend the amounts on the cards and not to leave unused credit on their card.
Although payment service providers must inform cardholders of the unused balance and the amount of the “punitive” fee for unused funds 90 days before the day the fee is charged, for employers who provide SZÉP card benefits to their employees it might be worth communicating this change and the upcoming deadline at the end of May.
Contact us
For a deeper discussion on the above, please reach out to your Vialto Partners point of contact, or alternatively:
● Roland Szabo, Director | roland.szabo@vialto.com
● Monika Keztyus, Senior Manager | monika.keztyus@vialto.com
● Denes Megyesi, Senior Manager | denes.megyesi@vialto.com
● Csilla Schneider, Manager | csilla.schneider@vialto.com
Further information on Vialto Partners can be found here: www.vialtopartners.com
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