From 1 February 2026, restaurant catering provided as a representation benefit is partially tax-exempt in Hungary. Government Decree 10/2026 introduced this change to support the restaurant sector, but the rules are specific and businesses need to apply them carefully.
What qualifies as tax exempt representation or restaurant consumpotion?
The exemption covers restaurant consumption tied to a genuine business or professional event: a client dinner after a meeting, a meal following a conference, or a corporate Christmas dinner. The key condition is that the event must have real professional content.
Team-building events without a professional agenda do not qualify. Neither do meals served in the company’s own office. The venue must also be a legal restaurant under Decree 210/2009, meaning food is prepared on-site. Buffets, cafes, bars, and pubs are excluded.
The limits for tax-exempt representation
Two treshold (ceilings) apply. Tax-free restaurant representation cannot exceed 1 percent of the company’s total annual revenue (including financial income, not only net sales), and it cannot exceed HUF 100 million in absolute terms.
Costs above HUF 100 million are taxed like other entertainment benefits: 15 percent personal income tax and 13 percent social contribution tax on 1.18 times the market value. KIVA-liable companies pay 10 percent KIVA on the benefit value instead. The tax advance on any excess must be paid by the 12th of the month following the quarter in which the threshold was crossed.
Year-end check
All companies must verify at year-end that their restaurant representation costs stayed within the 1 percent revenue limit, even if HUF 100 million was not reached. For most businesses, any remaining liability for 2026 will fall due on 12 July 2027.
One more change: tourism contribution halved
The tourism development contribution on qualifying restaurant services has been cut from 4 percent to 2 percent, calculated on the net (VAT-exclusive) value of the service.
Have questions? Contact Leinonen Hungary
Applying these rules correctly requires accurate records of event purpose, participants, and venue. If you are unsure how the new rules affect your business, Leinonen Hungary accounting team is ready to help.
