Working as a freelancer in Hungary

Hello

I worked in Budapest for six months in the late 1990ies, and it was difficult to make a living as an ESL instructor, but I was certainly able to do it. 
Returned a couple of years ago, and found that it wasn't a viable option in the least.  Individuals had to have a tax id # or be sponsored by someone who would be paying taxes on any income earned.  Teaching ESL 'under the table' just simply wasn't an option any longer. 
As for other fields of employ, I have no idea, but my experience was that Hungary is a tough nut to crack for employment; the Hungarians are fiercely proud and protective of their own culture/country/heritage --justifiably so -- and many even continue to resent the Treaty of Trianon. 
Never-the-less, if you can find a way of befriending some of the locals, they'll be just a fiercely proud to defend you as their own personal friend, so  . . . it's a beautiful history and culture and--dare I say?--Language too! if I could find a way of making a decent living in Budapest, I'd be there on the next plane!

Kenjee wrote:

Can foreigners work as self-employed in Hungary?

Yes. EU Citizens by default, and nationals from other countries with the correct type of visa (i.e. which includes a right to work).

Kenjee wrote:

What are the formalities to work as a freelancer?

Being self-employed and being a freelancer are a bit different in Hungary. Self employed is having a business structure as a sole proprietor, which includes all the formalities of taxes being paid by the business owner. Freelancing is usually intermediate, or infrequent work aside of a normal job. There is also a special type of freelancer called an "original producer". This is someone who just sells something they grew or made personally (like at a farmers market). There are very specific rules for original producers such as the original producer must sell direct to the consumer (i.e. which would preclude many sales over the Internet).

Someone doing freelance work needs to inform the tax authority that they will be doing freelance work in addition to their job, and then they get a tax number which they take to a printer and have the required receipt books printed out with this tax number on it. All transactions are suppose to be recorded in this book and a receipt given to the customer.

I say suppose above because there is a huge black work market in Hungary, and I have to too often ask specifically for receipts that are suppose to be given to me without me having to ask. A receipt means the freelancer has to report the transaction and pay income taxes, which they too often try to avoid. But the tax authorities have quite a bit of power in Hungary to levy heavy fines both to the freelancer not giving a receipt AND the person not getting a receipt. So expats should be aware of risks they take in not asking for and getting receipts.

Kenjee wrote:

What are the pros and cons of this status: social security, tax system, etc.?

Being a freelancer without a day job is uncommon here. Most self employed people simply start a business.

Kenjee wrote:

How is the freelance market in Hungary?

Pretty active for Hungarians. Seems everyone is doing side jobs here. Expats, much less so. Excepts are in areas were linguistic barriers are less an issue such as fields where Hungarians are more likely to speak a foreign language such as in business consulting, IT or language related fields.