According to EU regulations, the general rule is that insurance obligations arise in the country where the individual performs their activity. If the work is carried out exclusively in Hungary, the insurance is also established in Hungary. As a result of the Hungarian insurance relationship, there is an exemption from insurance obligations in other EU member states, since under EU regulations, an individual can only be insured in one country.
If work is performed in both countries, and the individual has an insurance relationship in another EU member state as well, the conditions for parallel employment must be examined. This includes determining the individual’s actual residence, and examining the proportions of working hours and income. If more than 25% of these criteria are met in the residence located in the other member state, the insurance will not be in Hungary. This must be supported by an A1 certificate issued by the authorities of the other member state. If the insurance remains in the other EU member state, there will be no social security obligations in Hungary, even if the individual operates as a sole proprietor.
If the insurance is in Hungary, then the minimum contribution payment rules must also be applied in the case of sole proprietors. It is also important to review the tax residency status in the given EU member state.
If you have any questions regarding the above, please feel free to contact our colleagues.