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EKHO, the simplified tax for creative professions

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EKHO, the simplified tax for creative professions

EKHO is short for Simplified Tax and Contribution (“Egyszerűsített Közteherviselési Hozzájárulás”) in Hungary. It is a favorable tax regime aimed at creators in various fields intended to promote Hungarian culture. Learn its basics, and find the list of professions that can make you eligible.

EKHO is for natural persons

The beneficiaries of the EKHO tax regime are natural persons who are involved in creative professions listed below. They can be in employment, but EKHO can also be applied to  income from agency contracts, self-employment, or someone’s own limited partnership company. Moreover, thanks to a recent change in regulations, KATA subjects can now also choose EKHO in 2022.

The rule of thumb is that after paying taxes and contributions for the minimum wage, income above the minimum wage is taxed at only 15% (of which 9.5% covers the personal income tax and 5.5% the social security contribution – in line with this, the EKHO after pensioners in only 9.5%).

Accordingly, the basis of the EKHO tax is the income above minimum wage. Administration is taken care of by the payer, who, starting from September 2022, is not even required to pay the 13% social contribution tax (in this context referred to as payer’s EKHO).

Income threshold for EKHO subjects

Normally the upper limit for EKHO eligibility is a yearly revenue of HUF 60 million, but this can be affected by the status or the profession of the EKHO subject.

  • Full-time employees (daily 8 hours or weekly 40 hours): HUF 60 million
  • Part-time employees: proportionate to their working time; e.g. for half-time workers (daily 4 hours or weekly 20 hours) it is HUF 30 million
  • Athletes: HUF 500 million
  • Coaches: HUF 250 million

EKHO in a nutshell

To sum up, you can take advantage of EKHO

  • as a natural person,
  • who performs work in the professions listed below,
  • and your yearly income is under the limit.

EKHO eligible professions in Hungary

EKHO eligible professions are listed according to FEOR, the Hungarian Standard Classification of Occupations (“Foglalkozások Egységes Osztályozási Rendszere”). In each category, not necessarily all professions qualify, only those where the result of the person’s work is artistic or otherwise unique. At the same time, a person can qualify even if their title is not among those listed below if the result of their work is artistic or otherwise unique.

  • 2123: Telecommunications engineer if
    • Acoustic engineer
    • Audio engineer
    • Sound engineer
    • Television director
  • 2136: Graphic and multimedia designer
  • 2627: Linguist, translator, interpreter if
    • Audiovisual translator
    • Literary translator
    • Translator of poetry
    • Translator of prose and drama
  • 2714: Cultural organizer if
    • Producer (in entertainment)
    • Production manager (in entertainment)
  • 2715: Editor of book and magazine publication
  • 2716: Journalist, editor of radio and television broadcast
  • 2719: Other culture and sports professional if
    • Art consultant
    • Music consultant
  • 2721: Writer (except journalists)
  • 2722: Artist
  • 2723: Artist-craftsman, industrial designer, clothes-designer
  • 2724: Composer, musician, singer
  • 2725: Director, director of photography
  • 2726: Actor, puppet player
  • 2727: Dancer, choreographer
  • 2728: Artist in circus and in similar performing arts
  • 2729: Other creative and performing arts professional
  • 3122: Electronics (light current) engineering technician if
    • Lighting technician for performances
    • Stage technician for performances
  • 3145: Broadcasting and audio-visual technician if
    • Film studio technician
    • Image technician
    • Music technician
    • Recording technician
    • Sound editor
    • Sound restoration technician
    • Sound studio technician
    • Sound technician
    • Studio technician
    • Video technician
  • 3711: Supernumerary, extra
  • 3712: Assistant director
  • 3714: Scenery shifter, decorator
  • 3715: Complementary film producing and theatre occupation
  • 3719: Other arts and cultural professional
  • 5211: Hairdresser if
    • Stage and theater hairdresser
    • Stage and theater perruquier
  • 5212: Beautician if
    • Make-up artist
    • Special effect makeup artist
    • Stage and theater make-up artist
  • 7212: Tailor, sewing worker if
    • Maker of costumes or evening attires
    • Theater tailor
  • 7213: Hatter, glove-maker if
    • Theater headdress maker
  • 7217: Shoemaker or related worker if
    • Theater cobbler

Beside these professions, all kinds of athletes and coaches may qualify if they are employed by official athletic organizations.

EKHO subjects are allowed to perform tasks only in eligible professions. If they start performing other tasks that do not fit the “artistic or unique” definition, they lose their eligibility and their work will be taxed in accordance with normal payroll tax regulations.

Helpers Team at your service

Depending on how you work, EKHO may or may not be for you. Helpers Finance offers accounting and bookkeeping services primarily to small and mid-sized business operating in Hungary, with a special expertise working with foreign owners, taxed under TAO or KIVA. We also offer payroll services and tax advisory.

Can we help you? Contact us today and let’s see how we can help you make the most of your Hungarian company.

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