Hungarian Tax Refund for Film Productions – NFI Deposit Account Maximum Amount Increases to HUF 44 Billion

Film productions may be eligible for a tax rebate equal to 30% of direct film production expenses incurred regarding Hungarian filming in Hungary or abroad, if at least 80% of the direct production expenses can be considered”Hungarian direct film production expenses.

Expenses for the direct production of Hungarian films (which are the basis for the film tax rebate) include not only the value of goods and services purchased from Hungarian suppliers, but also a certain part of the compensation expenses for such foreign cast and crew members who are liable for tax in Hungary.

Direct qualifying film production expenses that form the basis of the tax refund also include the cost of royalties (up to 4% of the film production expenses accounted for in the Hungarian film production company), producers’ fees (up to 4% of the film production expenses accounted for in the Hungarian film production company ), pre-production and post-production expenses, advertising expenses (up to 2% of film production expenses borne by the Hungarian film production company, capped at HUF 10 million), travel expenses (given whether the place of departure or arrival is in Hungary) and financing costs.

Film production companies can apply for the 30% tax reduction either directly with the sponsoring companies which earmark part of their tax for this purpose, or on the deposit account of the Hungarian National Film Institute (NFI). The amount of the tax rebate granted after an expenditure control procedure carried out by NFI can be claimed from this account. The amount that can be collected from the deposit account for the indirect support of film productions in one year increases from 33 billion HUF (~85 million EUR/~96 million USD) to 44 billion HUF (~115 million EUR/~128 billion USD) as of March 1, 2022.

The amount that can be collected in the deposit account for indirect support for film productions in one year increases from 33 billion HUF (~85 million EUR/~96 million USD) to 44 billion HUF (~115 million EUR/~128 billion USD ) as of March 1, 2022.

Laura T. Thrasher