Tax residence in Hungary for Pakistani taxpayers

Hungary treats its citizens as resident (dual citizens only with a Hungarian address), and other individuals if they hold a long-term residence right, their only permanent home is in Hungary, their centre of vital interests is there or — failing those — they spend at least 183 days there in the calendar year. Pakistan counts its own tax year of 1 July – 30 June, and a Pakistani citizen can stay resident under s. 82(d) with fewer than 183 days. Where both countries claim you, Art. 4(2) of the 1992 Pakistan–Hungary Convention decides.

Check your status: Pakistan and Hungary

Free, no sign-up, about 3 minutes. Conclusion under Pakistan's Income Tax Ordinance, 2001, compared with the law of Hungary and the tax treaty.

When Hungary treats you as a tax resident

Hungary treats its citizens as residents by citizenship alone; a dual citizen (for example Hungarian and Pakistani) only if he or she has a registered Hungarian address. For others: long-term residence right, permanent home, centre of vital interests or 183 days.

Hungarian law asks whether your only permanent home is in Hungary; a home in Pakistan (or elsewhere) sends you to the centre-of-vital-interests test.

You are a Hungarian citizen with a registered address in Hungary — under the Szja tv. you are a Hungarian resident by citizenship alone, regardless of days or home.
You hold only Hungarian citizenship — under the Szja tv. you are a Hungarian resident by citizenship alone, regardless of days or home.
You hold a long-term (permanent) residence right in Hungary — under the Szja tv. you are a Hungarian resident.
Your only permanent home is in Hungary — you are a Hungarian resident.
Your centre of vital interests is in Hungary — you are a Hungarian resident.
Your centre of vital interests cannot be determined and you spent 183 days or more in Hungary in the calendar year — that is a habitual abode, so you are a Hungarian resident.

When you are a nonresident

Under Hungarian law you are not a Hungarian resident. Hungarian-source income (including pay for work physically done in Hungary) is still taxed there, subject to the 183-day rule of Art. 16(2) of the Pakistan–Hungary Convention.

Where the rules of Hungary clash with Pakistani tax rules

Collision: resident of both countries — the treaty decides. Hungary treats you as resident and so does Pakistan (183 days in its tax year, s. 82(c) or, for a citizen, s. 82(d)). Art. 4(2) of the Pakistan–Hungary Convention decides: permanent home; if a home in both — centre of vital interests; if that cannot be determined or you have no permanent home in either country — habitual abode; then nationality; then mutual agreement. Under s. 107 the treaty prevails over the Ordinance.
Collision: Hungarian–Pakistani dual citizens with a Hungarian address. If you hold Hungarian citizenship and a registered Hungarian address (address card), Hungary treats you as resident by citizenship alone — even if you live in Pakistan. If Pakistan treats you as resident too, the tie-breaker applies; because you are a national of both countries, a case that reaches the nationality step can be resolved only by mutual agreement (Art. 4(2)(d)). Deregistering the Hungarian address removes the citizenship-based residence (the other Hungarian tests still apply).
Collision: Pakistani citizen resident in both countries. Since tax year 2023, s. 82(d) of the Income Tax Ordinance treats a Pakistani citizen as resident in Pakistan if he or she was not present in any other country for more than 182 days in the Pakistani tax year, or is not a resident taxpayer of any other country. Hungary can treat you as resident through a long-term residence right, your only permanent home or your centre of vital interests without 183 days. If both apply, Art. 4(2) of the treaty decides; if the treaty makes you a resident of Hungary, Pakistan may tax you only on Pakistan-source income as the treaty allows. Keep a Hungarian certificate of residence and a day count for both tax years.
Collision: Hungarian long-term residence right. With a long-term residence right Hungary treats you as resident automatically, whatever your home or centre of vital interests (Kúria, Kfv.I.35.493/2019/7). That domestic rule does not decide the treaty question: if Pakistan also treats you as resident, Art. 4(2) looks at your permanent home, centre of vital interests and habitual abode.
Collision: centre of vital interests in Hungary. If your centre of vital interests is in Hungary, Hungary treats you as resident even if you keep a home in Pakistan. The Kúria weighs family and economic ties, in particular where you use your bank accounts and cards day to day. The same factors decide the treaty's vital-interests step if you have a permanent home in both countries — keep evidence of where your family, work, bank accounts and property are.

What else to know

Different tax years: 1 July – 30 June and the calendar year. Pakistan counts days in its tax year (1 July – 30 June); Hungary counts the calendar year, and days of arrival and departure count as full days. The same stay can give different totals in each country. The treaty's 183-day employment test (Art. 16(2)) refers to «the fiscal year concerned» — check your days in the Hungarian calendar year as well as in the Pakistani tax year.
Working in Hungary while resident in Pakistan. Work physically performed in Hungary — including remote work for a Pakistani employer — is Hungarian-source income. If you are resident in Pakistan under the treaty, Hungary does not tax the salary only if all three conditions of Art. 16(2) are met: no more than 183 days in Hungary in the fiscal year concerned, an employer that is not Hungarian-resident, and pay not borne by a Hungarian permanent establishment. Otherwise Hungary taxes it at 15%. In Pakistan, salary earned abroad is exempt if Hungarian tax on it was withheld and paid to the Hungarian tax authority (s. 102); otherwise Pakistan gives a credit (Art. 24(b), s. 103).
How double tax is relieved between Pakistan and Hungary. If you are resident in Pakistan, Hungarian tax on Hungarian-source income is credited against Pakistan tax on that income, up to the share of Pakistan tax attributable to it (Art. 24(b)); under s. 103 the limit is computed separately for each head of income and unused credit is lost. If you are resident in Hungary, income Pakistan may tax is exempt in Hungary, except dividends, interest, royalties and fees for technical services, for which Hungary credits the Pakistan tax (Art. 24(a)). The MLI did not change these rules.
Pakistani government posting to Hungary. Federal and Provincial Government employees and officials posted abroad remain resident in Pakistan under s. 82(c). Under Art. 20(1) of the treaty their government salary is taxable only in Pakistan; Hungary may tax it only if the services are rendered in Hungary by a Hungarian resident who is a Hungarian national or did not become resident there solely to render the services.
Which treaty applies: the 1992 Convention as amended in 2020. The Pakistan–Hungary Convention signed on 24 February 1992 has applied in Hungary since 1 January 1995. A 2020 protocol replaced only the exchange-of-information article (applicable from 2022), and the MLI added only the preamble and the principal purpose test. Residence tie-breaker: Art. 4(2); employment: Art. 16 (183 days in the fiscal year concerned); relief: Art. 24.
Social security: no Pakistan–Hungary agreement found. No social security agreement between Pakistan and Hungary was found in the sources checked for this tool. Without an agreement, work in Hungary is subject to Hungarian social security contributions under Hungarian rules, with no certificate of coverage based on Pakistani coverage; check with the Hungarian authorities before you start work. Social security contributions are outside the income tax treaty.

How dual residence is resolved

If both countries treat you as a resident, Art. 4(2) of the treaty applies: Convention between the Islamic Republic of Pakistan and the Republic of Hungary for the avoidance of double taxation with respect to taxes on income (signed on 24 February 1992), as amended by the Protocol of 2020. The tests are applied in order — permanent home, centre of vital interests, habitual abode, nationality, and finally mutual agreement between the tax authorities.

Terms you will come across in Hungary

belföldi illetőségű magánszemély: Hungarian resident individual under § 3 point 2 Szja tv.
lakcímkártya: Hungarian address card — proof of a registered address
letelepedett / huzamos tartózkodási jogosultság: long-term (permanent) residence right; it makes a foreigner resident in Hungary
létérdekek központja: centre of vital interests — family and economic ties
Szja tv.: Act CXVII of 1995 on Personal Income Tax (15% flat rate)
NAV: Nemzeti Adó- és Vámhivatal, the Hungarian tax and customs authority; it issues certificates of residence

Questions

Which tax treaty applies between Pakistan and Hungary?

The Convention signed on 24 February 1992, applicable in Hungary from 1 January 1995 and amended in 2020 only on exchange of information. Its tie-breaker for individuals is Art. 4(2): permanent home, centre of vital interests, habitual abode, nationality, then mutual agreement.

Does Hungary tax my income from Pakistan?

If you are a Hungarian resident under the treaty, income Pakistan may tax is generally exempt in Hungary; for dividends, interest, royalties and fees for technical services Hungary instead credits the Pakistan tax (Art. 24(a)).

I work in Hungary for a few months. Does Hungary tax my salary?

If you are resident in Pakistan under the treaty, Hungary does not tax the salary only if you were present no more than 183 days in the fiscal year concerned, your employer is not Hungarian-resident and no Hungarian permanent establishment bears the pay (Art. 16(2)).

Sources

Legislation and official guidance

§ 3 point 2(a) of Act CXVII of 1995 on Personal Income Tax (Szja tv.) — Every Hungarian citizen is resident, except a dual citizen who has no residence or habitual abode (registered address) in Hungary.
NAV booklet 04 «Magánszemélyek külföldről származó jövedelme» (20 Feb 2026) — Hungarian citizens remain resident even when living abroad for years (except dual citizens without a Hungarian address); categories of residents are listed as in § 3 point 2 Szja tv.
§ 3 point 2(c) Szja tv. — Resident: a third-country national holding a long-term residence right in Hungary, and a stateless person.
§ 3 point 2(d) Szja tv. — Other individuals are resident if (da) their only permanent home is in Hungary; (db) their centre of vital interests is in Hungary, if they have no permanent home in Hungary or also have one abroad; (dc) their habitual abode is in Hungary, if neither of the above settles it.
§ 7 point 44 of Act CL of 2017 on the Rules of Taxation (Art.) — Habitual abode in Hungary: at least 183 days of stay in a calendar year; days of arrival and departure count as full days.
§ 3 point 4(d) Szja tv. — Employment income is sourced where the work is normally performed: work done physically in Hungary (including remote work for a foreign employer) is Hungarian-source income.
Income Tax Ordinance, 2001, s. 82(a) — An individual is a resident individual for a tax year if present in Pakistan for a period of, or periods amounting in aggregate to, 183 days or more in the tax year (1 July – 30 June).
Art. 16(2) Pakistan–Hungary Convention (1992) — Pay of a resident of one State for employment exercised in the other State is taxable only in the residence State if (a) the employee is present in the other State for a period or periods not exceeding in the aggregate 183 days in the fiscal year concerned, (b) the pay is paid by or on behalf of an employer who is not a resident of the other State, and (c) it is not borne by a permanent establishment or fixed base of the employer in the other State.
Art. 4(2) Pakistan–Hungary Convention (1992) — Dual-resident individual: (a) resident of the State in which he has a permanent home available to him; if he has one in both States — the State with which his personal and economic relations are closer (centre of vital interests); (b) if that State cannot be determined, or if he has not a permanent home available to him in either State — the State in which he has an habitual abode; (c) habitual abode in both States or in neither — the State of which he is a national; (d) national of both or of neither — the competent authorities settle the question by mutual agreement.
Income Tax Ordinance, 2001, s. 107(2) — Subject to s. 109, a double taxation agreement and its implementing notification have effect notwithstanding anything in any other law, so far as they provide relief from tax under the Ordinance, determine the Pakistan-source income of non-residents, or provide for exchange of information.
Income Tax Ordinance, 2001, s. 82(d) (inserted by the Finance Act, 2022; consolidated text amended up to 30.06.2026 listed by FBR) — A citizen of Pakistan is also a resident individual if he or she is not present in any other country for more than 182 days during the tax year, or is not a resident taxpayer of any other country. Applies from tax year 2023.
Income Tax Ordinance, 2001, s. 102 — Foreign-source salary received by a resident individual is exempt if the individual has paid foreign income tax on it; tax is treated as paid if it was withheld by the employer and paid to the revenue authority of the country where the employment was exercised.
Art. 24 Pakistan–Hungary Convention (1992) — (a) Hungary exempts income of its resident that may be taxed in Pakistan, except items under Arts. 10, 11, 12 and 13 (dividends, interest, royalties, fees for technical services), for which it deducts the Pakistan tax paid up to the Hungarian tax attributable to them; exempt income may be taken into account for the rate. (b) Pakistan, subject to its law on foreign tax credit, credits Hungarian tax on income from Hungarian sources taxed in both States, up to the proportion of Pakistan tax that this income bears to the entire income chargeable to Pakistan tax.
Income Tax Ordinance, 2001, s. 103 — A resident taxpayer gets a credit for foreign income tax on foreign-source income equal to the lesser of the foreign tax paid and the Pakistan tax on that income (average Pakistani rate × net foreign-source income), computed separately for each head of income; unused credit is not refunded, carried back or forward; the foreign tax must be paid within two years after the end of the tax year.
§ 32(1) Szja tv. — Where a resident's consolidated tax base includes foreign-source income taxed in the source state, the Hungarian tax is reduced — unless a treaty provides otherwise — by 90% of the foreign tax paid, but not more than the Hungarian tax on that income. Without a treaty, foreign tax cannot be credited against tax on Hungarian-source income; refundable foreign tax does not count.
Synthesised text of the MLI and the Pakistan–Hungary Convention (FBR) — MLI in force for Pakistan from 1 April 2021 and for Hungary from 1 July 2021; it adds the new preamble (Art. 6 MLI) and the principal purpose test (Art. 7 MLI) only. Art. 4, 16 and 24 are unchanged. The authentic texts prevail.
Income Tax Ordinance, 2001, s. 82(c) — An individual is a resident individual for a tax year if he or she is an employee or official of the Federal Government or a Provincial Government posted abroad in the tax year — regardless of days in Pakistan.
Art. 20(1) Pakistan–Hungary Convention (1992) — Remuneration (other than a pension) paid by a State, its political subdivision or local authority for services rendered to it is taxable only in that State; it is taxable only in the other State if the services are rendered there and the individual is a resident of that State who is its national or did not become resident there solely to render the services.
NAV — Double Taxation Treaties of Hungary (as of 01/01/2026) — Pakistan: signed 24 February 1992, promulgated by Act II of 1996, applicable from 1 January 1995; amending protocol (note verbal) of 14 July 2020, promulgated by Act CIII of 2020, applicable from 1 January 2022.
Protocol of July 2020 amending the Pakistan–Hungary Convention (FBR notification and annex) — Replaces Art. 27 (exchange of information) with the current OECD wording; enters into force on the thirtieth day after the later notification. It does not change the residence, employment or relief articles.
Art. 4(2)(b) Pakistan–Hungary Convention (1992) — If you have no permanent home available in either State, the treaty goes straight to habitual abode (the centre of vital interests step applies only where there is a home in both States).
Art. 4(2)(a) Pakistan–Hungary Convention (1992) — Centre of vital interests: the State with which your personal and economic relations are closer.
Art. 4(2)(c), (d) Pakistan–Hungary Convention (1992) — Habitual abode in both States or in neither — resident of the State of which you are a national; national of both or of neither — the competent authorities settle the question by mutual agreement.

Case law

Kúria (Supreme Court of Hungary), Kfv.I.35.493/2019/7, 30/04/2020 — A Vietnamese national with permanent-residence (letelepedett) status who had lived in Hungary with his family since 1989 was a Hungarian resident under § 3 point 2(c) Szja tv.; his family and economic ties confirmed this, so his reliance on Vietnamese residence under Art. 4 of the treaty was rejected (income tax case following an expenditure-vs-income audit).
Kúria (Supreme Court of Hungary), Kfv.I.35.013/2016/10, 16/06/2016 — A Georgian national living in Budapest since 2006 was held a Hungarian resident: the centre of vital interests is determined comprehensively by the closest family and economic ties (home, companies, employment contract, bank accounts and card use).
Kúria (Supreme Court of Hungary), Kfv.I.35.118/2020/4, 09/04/2020 — A person who claimed to live in Germany was held a Hungarian resident: closer economic ties are decisive for the centre of vital interests, above all where the person regularly uses bank accounts and cards.
Kúria (Supreme Court of Hungary), Kfv.VI.35.085/2017/12, 24/01/2018 — A foreign national with an immigration permit, a registered home in Budapest, and family, companies and accounts in Hungary was a resident with unlimited tax liability, because his closest personal, family and economic ties led to Hungary.

Updated 04/11/2026. The result is for information only and is not tax or legal advice. The FBR, other tax authorities and courts may interpret the rules differently, including because of circumstances not covered here, and the law changes with each Finance Act. Consult a qualified adviser before making decisions.

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