Hungary is set to launch a new Guest Investor Program (GIP) that will grant a 10‑year residency permit to non‑EU investors. The legislation is expected to take effect in late 2024, with the first permits likely issued around September 2024. The program is designed to streamline the existing investor‑residency routes and to provide a more predictable pathway for high‑net‑worth individuals.
Investment options
| Option | Minimum investment | Type of investment |
|---|---|---|
| Real‑estate fund | €250,000 | Investment in a fund that purchases Hungarian property |
| Direct real‑estate purchase | €500,000 | Acquisition of residential or commercial property |
| Donation | €1 million | Direct contribution to a government‑approved fund (rarely used) |
The €250 k fund route does not require the investor to own the property directly; the fund handles acquisition and management. The €500 k direct purchase can be made anywhere in Hungary, though the final regulations may limit purchases to specific districts to avoid price inflation in high‑demand areas such as central Budapest.
Residency terms
- Permit length: 10 years, renewable as long as the investment is maintained.
- Physical presence: No minimum stay requirement is stipulated, allowing investors to remain non‑tax residents if they do not reside in Hungary.
- Path to permanent residency or citizenship: The program does not automatically confer permanent residency or citizenship. Applicants must meet separate criteria (e.g., language proficiency, continuous residence) for those statuses.
Tax considerations
- Corporate tax: Hungary’s corporate tax rate is 9 %, the lowest in the EU. Investors who establish a Hungarian company and generate income (e.g., from rented property) will be taxed at this rate.
- Personal income tax: Investors who are not tax residents of Hungary are not liable for personal income tax on foreign‑source income. Rental income derived from Hungarian property owned directly by the investor may be subject to Hungarian tax unless a tax treaty applies.
- Wealth/inheritance taxes: Hungary does not levy wealth or inheritance taxes, and there are no specific crypto‑asset taxes reported for non‑resident holders.
Existing pathways (pre‑2024)
Before the GIP, Hungary offered a permanent residency route that required a €300 k investment in government bonds. That program was suspended in 2017 after a high‑profile case involving a sanctioned individual. A more flexible route remained, allowing investors to:
- Start a Hungarian company (subject to the 9 % corporate tax).
- Purchase property through the company – typically two apartments worth a combined €240 k.
- Rent the property – generating taxable corporate income while maintaining the residency permit.
These earlier schemes generally provided permits for 1–5 years, depending on the investment type and the applicant’s nationality.
Comparison with other EU programs
| Country | Minimum investment | Permit length | Notable features |
|---|---|---|---|
| Portugal | €280 k (property) | 5 years (renewable) | Path to citizenship after 5 years |
| Spain | €500 k (property) | 1 year (renewable) | Requires physical residence |
| Greece | €250 k (property) | 5 years (renewable) | Low investment threshold |
| Hungary (GIP) | €250 k (fund) / €500 k (property) | 10 years (renewable) | Lowest corporate tax in EU, no wealth tax |
The Hungarian 10‑year term is among the longest in Europe, matching the duration of Dubai’s investor visa.
Practical advice and risk factors
- Regulatory clarity: Detailed implementation rules (e.g., eligible districts, fund licensing) are still pending. Prospective applicants should monitor official publications and consult Hungarian immigration specialists.
- Market exposure: Direct property purchases expose investors to Hungarian real‑estate market fluctuations. Fund investments may mitigate this risk but add a layer of manager performance risk.
- Nationality considerations: Some nationalities may receive shorter initial permits or additional scrutiny. Applicants should verify any country‑specific restrictions.
- Tax residency: Maintaining non‑resident status requires that the investor does not spend sufficient time in Hungary to trigger tax residency (typically >183 days per year). Failure to do so could result in personal income tax obligations.
- Exit strategy: The program does not guarantee a straightforward path to citizenship. Investors seeking citizenship must satisfy separate language, residence, and integration requirements.
Summary
Hungary’s upcoming Guest Investor Program offers a streamlined, 10‑year residency route for investors willing to commit €250 k–€500 k to Hungarian real‑estate assets or funds. The program leverages Hungary’s low corporate tax rate and lack of wealth taxes, positioning the country as a competitive option for high‑net‑worth individuals seeking long‑term EU residency without immediate citizenship obligations. Prospective applicants should await the final regulatory framework, assess market and tax risks, and consider professional advice before committing capital.
