KATA Threshold 2026 in Hungary: Revenue Limit, Eligibility, and What Changed
The KATA threshold in Hungary for 2026 remains HUF 18,000,000 per full tax year, with no change from 2025. The current regime is still governed by Act XIII of 2022, and NAV’s January 2026 Booklet No. 99 confirms that the core rules, eligibility gates, and the HUF 50,000 monthly fixed tax all carry forward unchanged.[1][2][3]
Two points matter in practice. First, the often-cited HUF 3 million cap from the old regime does not apply in 2026. Second, KATA is still limited to full-time sole proprietors, and in principle they cannot earn income from legal entities at all, except for the taxi-driver carveout.[1][4][5]
What KATA is and who it applies to
KATA, kisadózó vállalkozók tételes adója, is Hungary’s fixed-amount small business tax regime for micro-entrepreneurs. Instead of taxing business profit under ordinary rules, the eligible taxpayer pays a monthly lump sum that covers most income-tax and social-contribution liabilities arising from the business.[1]
The regime was narrowed sharply in 2022. Before that reform, KATA had broad uptake among small businesses. The current framework is much narrower and was redesigned mainly to eliminate sham employment structures.[6]
Legal basis: Act XLVII of 2022 and its 2026 amendments
The governing statute is not Act XLVII of 2022. It is Act XIII of 2022 on the itemised tax for small taxpayers, effective from 2022-09-01.[2] The prior KATA framework under Act CXLVII of 2012 ceased to apply on 2022-08-31.[3]
For 2026, there are no enacted amendments changing the revenue ceiling, the monthly tax amount, or the eligible taxpayer population. NAV’s Booklet No. 99, updated in 2026-01, reflects continuity rather than reform.[1][7]
There is, however, active political discussion about broadening KATA again. As of the date covered by the source material, that discussion had not yet produced legislation. For advisors, that means the current statute remains the only safe basis for filing and planning.[6][8]
Revenue thresholds in 2026: the exact numbers
The HUF 18 million annual ceiling
The KATA annual revenue ceiling for 2026 is HUF 18,000,000 for a taxpayer who remains in KATA for the full calendar year.[1] That figure has been unchanged since the 2022 reform.
If KATA status exists for only part of the year, the limit is prorated at HUF 1,500,000 per calendar month of KATA status.[1] So a taxpayer in KATA for 10 months has a ceiling of HUF 15,000,000.
This threshold needs to be kept separate from the VAT exemption threshold. From 2026-01-01, the VAT exemption threshold increased to HUF 20,000,000, while the KATA ceiling stayed at HUF 18,000,000.[9][10] In 2025 the two numbers were aligned. In 2026 they are not. That creates a planning gap: a taxpayer can fall out of KATA before VAT registration is triggered.
The HUF 3 million cap on income from a single business client
There is no HUF 3 million single-client cap in the current KATA regime. That cap belonged to the pre-2022 rules, where a 40% surcharge applied above HUF 3,000,000 received from one corporate payer.[11]
Under the current Act XIII of 2022, the policy choice is different. The law does not preserve the old single-payer threshold. Instead, it generally prohibits KATA taxpayers from receiving income from legal entities at all, except in the taxi-service exception.[1][5] So if a 2026 guide still focuses on a HUF 3 million corporate-client cap, it is describing the old system, not the one currently in force.
What counts as KATA-scope revenue — and what doesn't
Revenue that counts toward the HUF 18,000,000 ceiling includes income from services to private individuals, product sales to private individuals, and taxi transport revenue, including the statutory taxi exception for legal-entity customers.[1]
Several items either fall outside the ceiling mechanics or trigger disqualification instead. The most important is income from a legal entity, other than the taxi exception. Under NAV’s guidance, receiving even a single forint of that type of income causes KATA status to terminate on the day before the income is earned.[1]
Income from real-estate letting under ÖVTJ code 68.20 is also a hard exclusion.[1] NAV’s FAQ material also highlights that certain health-fund insurance payments can trigger the same issue because the payer is a legal entity.[12]
The practical point is simple. The threshold analysis only starts after the income passes the eligibility filters. Some inflows do not merely count toward the ceiling. They end the regime.
Eligibility: who can elect KATA in 2026
Permitted legal forms
In 2026, KATA is available only to full-time sole proprietors registered under Act CXV of 2009 on sole entrepreneurs and sole proprietorships.[1] That is the core legal-form gate.
The following are outside the regime: limited partnerships (Bt.), general partnerships (Kkt.), limited liability companies (Kft.), and other legal persons or corporate entities.[4] Registered lawyers are also not treated as eligible KATA taxpayers under the current framework described in the source material.[1][5]
This matters because many legacy KATA explanations still describe the pre-2022 landscape. In 2026, legal form is not a minor technicality. It is the first screen.
Excluded activities and sectors
A sole proprietor is excluded from KATA if they earn income in the relevant year from ÖVTJ 68.20, the activity code for the letting and operation of own or leased real estate.[1] NAV’s guidance treats this as an absolute exclusion across the listed sub-codes. There is no de minimis threshold.[1]
A taxpayer is also blocked if NAV cancelled their tax number in the year of election or in the prior 12 months, or if a cancellation process is pending when the election is filed.[1] The source material also notes exclusion where the taxpayer is under winding-up, liquidation, or compulsory strike-off proceedings at registration.[3]
The employment condition
KATA is restricted to full-time sole proprietors. The full-time test is framed by exclusion. A person is not treated as full-time for KATA if, throughout the relevant period, they are in employment of at least 36 hours per week, insured abroad under EU or treaty coordination rules, a non-ancillary partner in another business, a foster parent, or in full-time education in an EEA state or Switzerland.[1]
For practice, the 36-hour employment rule is the one that comes up most often. A person with a 40-hour employment contract cannot also qualify as a KATA taxpayer. Part-time employment below 36 hours may still be compatible, but NAV aggregates concurrent employment relationships.[1]
What changed from 2025 to 2026
Threshold adjustments and indexation logic
On KATA itself, nothing changed. The annual ceiling remains HUF 18,000,000. The monthly flat tax remains HUF 50,000. The excess-income tax remains 40%.[1]
The reason is structural. The KATA Act does not contain automatic indexation. Its threshold is a fixed statutory number, not one linked to inflation or the minimum wage.[13] That is different from the Hungarian flat-rate regime, átalányadó, where revenue caps move with minimum-wage-based formulas.[13]
The adjacent system that did change in 2026 is VAT exemption. That threshold moved from HUF 18,000,000 to HUF 20,000,000 from 2026-01-01.[9][10] For advisors comparing KATA vs. átalányadó in the HUF 17 million to HUF 21 million range, that separation is now a real modeling issue.
Reporting and registration changes
The source material identifies no KATA-specific reporting or registration changes for 2026. The annual declaration remains form 26KATA, filed via ONYA, with a deadline of 2027-02-25 for the 2026 tax year.[14] The monthly payment due date also remains the 12th day of the following month, to tax account 10032000-01076349.[14]
There is political signaling about reform, including possible reopening of KATA to business-client invoicing, but nothing enacted yet. That distinction matters. A proposal is not a filing position.[6][8]
Tax amount and payment mechanics
Monthly flat-rate contribution: HUF 50,000
The fixed KATA payment for 2026 is HUF 50,000 per started calendar month of KATA status.[1] There is no part-month proration. If the month has started, the full monthly amount is due.[1]
Payment is due by the 12th day of the following month to NAV account number 10032000-01076349.[14]
The source material also lists cases where the taxpayer is exempt from paying the monthly amount for a whole month, including where the business is formally suspended or the taxpayer receives specified social benefits for the entire month.[3] From an advisory perspective, those exemptions should be documented even where the statute does not require a separate zero-activity declaration.
What the flat tax covers — and what it doesn't
The HUF 50,000 monthly KATA payment covers personal income tax, social security contributions, social contribution tax, and vocational training contribution on KATA-scope income.[1]
It does not cover the 40% tax on excess revenue above the ceiling. It also does not cover VAT, which remains a separate regime, or local business tax (HIPA), even though KATA taxpayers may elect a simplified HIPA base of HUF 2,500,000.[1] Chamber membership dues also remain outside KATA.[1]
The insurance side is often overlooked. The payment gives insured status, but the benefit calculation base remains HUF 108,000 per month.[10][15] That is materially below the 2026 minimum wage cited in the source material, and it affects pension accrual and short-term social benefits.[15]
Breach scenarios: what happens if you exceed the threshold
Excess income tax rate (40%)
If KATA-scope revenue exceeds the applicable annual ceiling, the taxpayer owes a 40% special tax on the excess.[1] For a full-year taxpayer with HUF 21,000,000 revenue, the excess is HUF 3,000,000 and the tax is HUF 1,200,000.[1]
For a partial-year taxpayer, the same 40% rate applies after proration of the ceiling. If KATA status existed for 10 months, the limit is HUF 15,000,000, and revenue of HUF 17,000,000 produces HUF 2,000,000 of excess and HUF 800,000 of special tax.[1]
The special tax is declared and paid by 2027-02-25 together with the annual declaration. If KATA status ends during the year, the source material states that declaration and payment are due within 30 days of cessation.[1]
Mandatory exit and re-entry rules
KATA can end voluntarily, but it also ends automatically in several cases. Voluntary deregistration takes effect on the last day of the month of the announcement. If sole-proprietor status itself ceases, KATA ends on that date.[1]
NAV may terminate KATA by decision where there are serious compliance failures, including invoice or receipt violations, undeclared workers, sale of uncertified goods, tax number cancellation, or enforceable net tax debt above HUF 100,000 at year-end.[16] The source material notes that where year-end debt is settled before the termination decision becomes final, KATA status is reinstated.[16]
Two exit triggers are especially unforgiving. If the taxpayer receives income from real-estate letting under ÖVTJ 68.20, or income from a legal entity outside the taxi exception, KATA ends on the day before that income is earned.[1]
Re-entry is restricted. A taxpayer leaving KATA cannot elect it again in the same calendar year or in the following 12 months.[17] For clients considering a late-year switch to take on a company contract, that timing rule often matters more than the immediate invoice.
Practical decision points for advisors and sole proprietors
For 2026, the threshold question is not really the HUF 18 million ceiling. It is the client base. If the taxpayer plans to invoice a company, institution, authority, or other legal entity, KATA is generally off the table before any revenue-cap analysis begins.[1]
The second issue is the separation between the KATA ceiling and the VAT exemption threshold. In 2026, a taxpayer can exceed the KATA limit while still remaining below the VAT exemption ceiling.[9][10] That changes the break-even analysis against átalányadó and makes side-by-side modeling more useful than rules of thumb.
The third issue is social-insurance adequacy. The HUF 50,000 monthly tax can look attractive on cash flow, but the HUF 108,000 benefit base is low.[10][15] For some sole proprietors, especially those planning around pension, sick pay, or parental benefits, that can outweigh the short-term tax simplicity.
Finally, month-by-month monitoring matters. KATA status can break because of a single transaction, and in some cases the regime ends the day before the income is earned.[1] In practice, that means invoice controls are part of tax compliance, not just bookkeeping hygiene.
Key statute and NAV guidance references
The primary legal reference for the current regime is 2022. évi XIII. törvény, the current KATA Act, effective from 2022-09-01.[2] The key operational guidance source is NAV Booklet No. 99, updated in 2026-01, which confirms the 2026 revenue ceiling, payment rules, exclusions, and termination triggers.[1]
For filing mechanics, NAV form 26KATA remains the annual declaration form.[14] For practical monitoring, NAV’s KATA information pages and FAQ materials are the most relevant administrative sources, especially on termination risks and edge cases such as legal-entity payers and health-fund payments.[12][16]
One final correction is worth making explicit. If a checklist or blog still cites “Act XLVII of 2022” as the KATA statute, that reference is wrong. For 2026 KATA work, use Act XIII of 2022 and NAV’s current booklet as the baseline authorities.[1][2]
Sources
NAV Booklet No. 99 — Itemised Tax for Small Taxpayers (January 2026).[1]
BDO Hungary — KATA Act summary.[2]
MKIK — 2026 General Tax Guide for SMEs.[3]
CMS Law — Hungary reshapes KATA small-business tax.[4]
NAV — Tasks for small taxpayers due to the new KATA.[5]
Telex/G7 — Government KATA reform coverage (May 2026).[6]
katakonyveles.hu — KATA szabályai 2026.[7]
Világgazdaság — KATA reform signal by Kármán András (May 2026).[8]
MKVKOK — 2026 tax changes article.[9]
DigitalConto — 2026 Key Tax Changes for Sole Proprietors in Hungary.[10]
Bankmonitor — article on broader KATA access and old single-payer cap.[11]
NAV FAQ — new KATA frequently asked questions.[12]
Jalsovszky — The inflation of taxes.[13]
NAV Form 26KATA — declaration page.[14]
Grant Thornton — regulations concerning Hungarian small taxpayers.[15]
NAV KATA information page.[16]
egykonyveloelete.hu — changing tax mode for sole proprietors.[17]