Student residency is normally given for the purpose of full-time study in Hungary. However, many Hungarian students work while attending university, and of course, the same option is available to foreign students. However, some conditions apply.
Work as an employee or in your own business
Work is most frequently performed either in employment or operating a business of your own. However, for students it is typical to work through “student organizations” (referred to as “diákszövetkezet” or “iskolaszövetkezet” in Hungarian), because they make job search easier and take care of a significant part of the administration both for the student and the actual employer.
In either case, you will need a social security number and a Hungarian tax number.
Limited working hours in employment
Whether you work through a student organization or in regular employment, your working hours are limited if you are in Hungary with student residency.
- During study period: at most 30 hours / week.
- Outside study period (so during exam periods and the summer break): at most 90 days or 66 working days / year.
If you are self-employed, you are not required to log your working hours, so they are obviously not limited.
Sign up with a student organization
Student organizations act as job agencies as well as administrative bodies. If you want to maximize your chances of finding a fitting job, you can be a member of more than one student organization at the same time. The student organization will ensure that your employment is compliant with regulations. For example, proportionately, your salary cannot be lower than the current minimum wage.
Depending on what you do and how much you work, being employed through a student organization might pay better than being employed regularly. This is because serious tax benefits apply: you are not required to pay the social security contribution (18.5%), while your actual employer does not have to pay social contribution tax (13%) on your work. In either case, if you are under 25, you do not have to pay personal income tax at all (otherwise it is 15%).
If you develop a good working relationship with your employer, they might be willing to employ you full-time after you graduate. Then you have to switch your student permit to a work permit, with which we are happy to help.
While staying in Hungary with student residency, you can set up a business of your own and perform gainful activity. In this case, flat-rate taxation might be the most cost-effective tax regime for you, because as a full-time university student you are not required to pay any tax below a yearly revenue of HUF 2 million. If you pass that limit, you pay taxes and contributions only above it – but if you are under 25, you do not have to pay the personal income tax. As a business owner, you do not have to log your business hours, so the limits on how much you are allowed to work do not apply.
If your business is feasible in the long run, you can keep it going even after you have obtained your degree. Since your student residency will expire then, you will need another purpose to stay in Hungary, for which operating a profitable business is a solid start.
Agency contract or simplified employment
Of course, you are also allowed to perform work through other methods available to Hungarian students. One is the agency contract, which is most typical for project-based work, and the other is simplified employment, which is most typical for seasonal jobs – when you are working for just one day at a time. However, these are taxed less favorably. Learn more here.
Tax residency with student work
When you perform work in Hungary, you become a tax resident here, even if you are not actually required to pay any taxes. This might be a problem only in some cases, e.g. if you travel back home for the summer break and want to do some work there too. In this case, you should check if there is a double taxation treaty between Hungary and your home country, and consult a tax specialist to learn how you can avoid double taxation.
Get help with residency from the Helpers Team
The Helpers Team has more than 15 years of experience with providing immigration related assistance to foreigners coming to Hungary. Whether you need help with application for any type of residency, social security or a tax ID, we are happy to assist.