Tax exemption helps tens of thousands of young mothers in Hungary
In the case of meeting full-year eligibility, the family policy measure coming into force on 1 January can save a total of over two thousand euros' worth of forints in taxes for Hungarian women aged between 25 and 30, who have children. The decision also affects student loans.
The income tax exemption for those under 25 years of age entered into force a year ago, and this year, women under 30 who have children do not have to pay income tax either, Vilaggazdasag recalled, noting that Agnes Hornung, state secretary for families at the ministry of culture and innovation, announced on 28 December that a new element, which is likely to affect tens of thousands of mothers with an income, would be added to the family tax system from January. PM Viktor Orban had already made mention of this plan in parliament at the end of September.
In reference to the government decree published in the Official Gazette, Hungary’s National Tax and Customs Authority NAV) writes that a tax discount can be claimed by any young mother who is 25 years of age or older and is entitled to a family discount after her biological or adopted child, or her fetus. Those eligible are not only entitled to the new social security exemption, but also, of course, to all other family benefits, such as family tax relief, expectancy support and child care fees.
In 2023, this can can result in annual tax savings of up to 899,914 Hungarian forints, or more than two thousand euros.
Vilaggazdasag, a Hungarian economics portal, also highlights that as of 1 January, family tax allowance for parents raising children with a long-term illness or disabilities will increase with an additional monthly 10 thousand forints (appr. 25 euros), while the existing benefits (higher child allowance, meal contribution, travel discount) will remain in effect.
In a previous statement, Agnes Hornung announced that as of 1 January, the government will waive all student loan debt for women who give birth to or adopt a child during their studies, or within two years after the completion of their studies.
“If a female student loan holder, aged below 30, gives birth to a child or adopts a child during her studies in higher education, or within two years after their completion (obtaining a diploma), she will become eligible to receive a non-refundable child support amounting to one hundred per cent of her outstanding student loan debt, provided that she submits an application for child support to the student loan organisation. Using the form provided by the student loan organisation, she must apply within 60 days of her child’s birth, or of the decision authorising the adoption becoming final, in case of adopting a child,” the decree says.