Understanding the insurance obligations for third-country nationals employed in Hungary can be complex.
Here’s a simplified breakdown to help clarify the rules.
What is a Third-Country National?
Under Hungary’s Social Security Act (Act CXXII of 2019), a “third-country national” is someone from a country outside the European Economic Area (EEA) and not covered by a bilateral social security agreement with Hungary. This definition is crucial when determining whether such individuals are required to have insurance.
Who is Exempt from Hungarian Social Security?
Third-country nationals working in Hungary under foreign employers (not registered under Hungarian law) may be exempt from Hungarian social security contributions if:
- Their work in Hungary is temporary (under two years) as part of a secondment, assignment, or labor leasing.
- Three years have passed since any prior employment in Hungary.
- They can prove insurance coverage in their home country, based on specific requirements.
This rule applies even if Hungary does not have a bilateral social security agreement with the individual’s country of origin.
Employment Permits and Insurance
Employing third-country nationals in Hungary requires compliance with additional regulations:
– Government Decree 445/2013: Defines a third-country national as someone who does not have the right to free movement or residence within the EU.
– 2023 Act XC on Entry and Residence: Third-country nationals may stay in Hungary for short, long, or indefinite periods.
A short-term stay is defined as up to 90 days within a 180-day period, during which no residence permit is required. However, this status may complicate obtaining a social security number (TAJ card) if the person is employed.
Short-Term Employment
Third-country nationals holding short-term visas or meeting specific criteria under EU regulations (like Regulation 2018/1806) can work in Hungary. However, they still need to meet legal requirements, such as obtaining a work permit unless exempted under specific conditions outlined in Government Decree 445/2013.
Key Takeaways
– Temporary employment in Hungary by a third-country national often requires both proof of insurance from the home country and a work permit.
– Residence permits are not necessary for short stays, but lack of one may affect access to local services, including social security.
– Employers should carefully assess the legal and administrative requirements to ensure compliance.
For further details or assistance, consult an expert in CFH Team.