From early 2026, the tax rules related to hospitality for representation purposes have significantly changed. Under certain conditions, businesses may now use restaurant or confectionery services tax‑free — a major advantage for business meetings, partner events, and professional gatherings.
But when exactly does the tax exemption apply, and how can companies prove that the consumption truly qualifies as tax‑free?
Below you’ll find the key questions and answers.
1. How does the tax exemption work?
The tax exemption applies to food and beverage consumption provided specifically as restaurant or confectionery services used for representation purposes.
The benefit has an upper limit:
- up to 1% of the company’s total annual revenue,
- but not exceeding HUF 100 million.
For companies starting or ceasing operations during the year, the limit must be calculated proportionately.
2. How can a company prove that the consumption took place in a restaurant or confectionery?
The company must prove that the venue falls under the regulated business category of a restaurant or confectionery. This can be verified most easily (and is required) here:
OKNYIR Search (National Commercial Register – Business Finder):
https://oknyir.kh.gov.hu/
Anyone can check whether a venue is registered as a restaurant or confectionery. If it is, the conditions are met.
Alternatively, the classification can be verified from the operating licence displayed on-site.
3. What about restaurants operating inside hotels?
Not all hotel restaurants qualify as “restaurant hospitality” for tax exemption.
Tax‑free consumption may apply if:
- the restaurant operates as a separate unit,
- and is run by an independent business entity (not part of the hotel’s integrated services).
It is not tax‑free if the restaurant is part of the hotel’s accommodation service and is listed as such in the register.
Again, the OKNYIR search helps determine this.
4. Does the exemption apply to takeaway food or drinks?
Unfortunately, no.
The exemption only applies if consumption takes place on the premises (in the restaurant or confectionery).
Food or drinks consumed elsewhere do not qualify as tax‑free, even for representation purposes.
5. Is the service charge also tax‑exempt?
Yes — as long as it is connected to restaurant services.
Since the service charge directly relates to food and beverage consumption, it is treated the same way as the value of the meal — meaning it forms part of the tax‑free representation.
Important exception:
Fees for other types of services (e.g. billiards, performances, additional event programs) are not tax‑exempt.
6. Is restaurant consumption abroad tax‑exempt during business trips?
No.
Foreign restaurant services remain taxable, as the regulation was introduced specifically to support Hungarian restaurants.
7. What must the company prove in case of an audit?
The invoice alone is not sufficient. The company must prove that the event was genuinely representation.
The following documents should be retained:
- invitations
- list of participants
- internal communication
- agenda or program plan
- evidence of professional content
Authorities pay particular attention to the ratio of professional vs. leisure elements.
8. What happens if the company exceeds the exemption limit?
If the benefit exceeds the tax‑free threshold, the excess amount becomes taxable:
- tax base: 118% of the benefit value
- payable taxes: 15% personal income tax + 13% social contribution tax
- for KIVA taxpayers: 15% personal income tax + 10% KIVA
9. What qualifies as representation?
Eligible events include:
- business lunch or dinner
- negotiations or partner meetings
- conferences, workshops
- product presentations
- press conferences
- project closure events
- annual assessments
- company anniversaries with professional content
- presentations or results briefings for partners
10. Is it advisable to keep a separate register?
Yes — it is recommended to separately track the value of tax‑free restaurant/confectionery consumption and mark which items on the invoice meet the conditions.
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