How to save cost of living in Budapest

Welcome to Hungary as a person from a 3rd country...
I have no idea about your situation because my permit was as a family member not looking to work.
I have the "right" to work here but not the need or desire to.
Most professionals here don't give any hints or info unless they are paid for it.
Seems like allot of hassle and money to live here, are you sure this is the place you wish to be if it costs so much?
I knew a American lady living here who didn't work but did have one of those limited companies to get her resident permit.
She later did work off and on in a office here, doubt it was to make money though. She was just bored and alone.
Some people have money to burn to come here .

If it is too pricey here why be here?
I hope someone knows a better solution for you but they do make it hard even for those of us married to citizens and from a 3rd country. We are not exactly on the list of wanted here.
I know people from 3rd countries who moved here but do not work, maybe it is the work permit that is the huge issue for you?
Perhaps you can get hired somewhere here at a  place that will help with permits?
My sister moved to the UK in the late 60's while just on holiday, decided to leave her US husband and stay in the uK. It took her over one year to get her working permit after she married a UK citizen.
No one likes us non EU people much.

Looking at your profile, it says you are from Malaysia? Maybe consult the embassy for your country or talk to someone from one of the Asian countries.

Non Eu is a lot of places and each country has different rules.

Like i know as an USA person to move to the Netherlands there is the normal non eu people rules, BUT USA has some special treaties and agreements with Netherlands where there is different visas, permits that are specific to usa people.

I know i read about this online and also looked at their immigration site. I talked to the ambassador directly and he told me like with screen images of how to do it, like there was the normal residence permits, then a spot where it says "i am applying based on a treaty" or something like that. You go threw that way and it is whole different set of rules. In this case it was much easier.

I mention this as i honestly did not know, and also this related to a self employed, small business owner.  Something like just to live there income requirements were a bit high, but if you applied under the treaty arrangement then you had to keep like 5 thousand euros in the bank, easy business requirements and just have enough to pay rent, healthcare etc. 

I do not know the exact details, as i did not do this and only causally looked at this due to some personal reasons. I have looked at moving there in a serious way at all and do not know much about it. But i am just saying that this was the case and not something openly listed up front but was doable. If the ambassador had not told and explained this i would of never even known. He even sent me info and told me where and how to look up this treaty with usa/netherlands which i will say no one ever mentioned in usa or was something anyone talked about!

In fact i know Netherlands has some special treaties with people from Indonesia to move there, and like Denmark something with some african countries also. Due to colonies and stuff this is common with western europe countries

Hungary is not a small business friendly country. As you now know, this is not a "pay as you go" tax system. You have to estimate and pre-pay your business taxes. Even if you earn nothing in the future. And the idea of registering as a "freelancer" here is more thought of as something you do on weekends, not your "day job" income source.

And a bit of advice:

- Don't trust an attorney here out of hand. They also can have their own kinds of scams going. I see no reason why you "cannot get residence" unless you start a KFT (limited company). That just sounds wrong. It may "help" show you can support yourself here, but it should not be an "obligation". And even if you do start a KFT, do know they cost only about 350 EUR to start. You should not pay more. If he is charging you more than that, it is a scam.

- Yes, an accountant's standard monthly fee is about 100 EUR, but that also depends on your billing. If you have only one client and bill them once or twice a month, than you should be able to negotiate a lower monthly fee from the accountant.

- Saying you have to pay 300 EUR a month in income tax for a KFT is not necessarily correct either. It depends on how the KFT is setup and your "relationship" to the KFT.

laukok wrote:

So it is approx 1000 EUR per month for living in Budapest/ Hungary. It is more expensive than living in the UK, how come!??

Kind of all explains why there are so many more Hungarian citizens living and working in the UK than UK citizens living and working in Hungary.

klsallee wrote:

laukok wrote:

So it is approx 1000 EUR per month for living in Budapest/ Hungary. It is more expensive than living in the UK, how come!??

Kind of all explains why there are so many more Hungarian citizens living and working in the UK than UK citizens living and working in Hungary.

It's certainly easier to get set up in the UK but make no mistake, you will have very high living costs there.

The killer is accommodation.  It's fantastically expensive compared to Hungary.  If you live in London, it's unaffordable on low wages.  There's a culture of ownership and the rental sector is in the hands of private landlords.

Transport is also at very high costs if you have to commute.   There's also a per person tax on each area which can be significant.   So wages are higher but so are costs.

On the other hand, healthcare is good and it's free for all. Healthcare is actually free at point of delivery - no-one asks for minor things but they do for "big stuff" if they suspect the person is not legit.  But they would never withhold treatment because of issues over money.  They try and get the cash back later. 

Schools are also free, broadband is relatively cheap (but also not very good in some places) and mobile phones everywhere.  Cars are significantly cheaper but fuel costs about 30% more. University education is terribly expensive and likely to get people in very high debt over it and their living expenses.  Best to study in Germany or elsewhere where tuition costs is much lower and living costs are about the same.

Hungary is not a friendly country for businesses as it has high taxes and over regulation.  All of that just creates overheads.  Superficially tax rates are lower here but they gouge you on VAT and other hassles.   Like here, in the UK, there's ACT - Advanced Corporation Tax.   Pay in advance and then if you don't have turnover, you have to claim it back.  It's a significant juggling act for cashflow if you have things like bad payers, slow payers etc.   Moreover, everything is moving digital (like here) and it's compulsory for companies in the UK to have real time reporting to the tax office.  VAT administration is just horrible everywhere in the EU especially for cross border traders.   

If anyone values their free time, paying the accountant EUR 100 is well worth it.

fluffy2560 wrote:

If anyone values their free time, paying the accountant EUR 100 is well worth it.

Depends. If one bills only one client, once a month for example, the accountant has almost no work. Than one can try to get the accountant fee as low as 40-50 EUR a month. Saving 600 - 700 EUR a year in accountant fees is worth asking.

klsallee wrote:

fluffy2560 wrote:

If anyone values their free time, paying the accountant EUR 100 is well worth it.

Depends. If one bills only one client, once a month for example, the accountant has almost no work. Than one can try to get the accountant fee as low as 40-50 EUR a month. Saving 600 - 700 EUR a year in accountant fees is worth asking.

Yes it's true.  What I used to think about on any of these things (using "professionals" to do stuff) is weighing up my free time and my effective daily or hourly rate. If my rate is higher than theirs, then obviously it's a no-brainer they should do it.

I should say one nightmare in the UK which inevitably could turn up here is the idea of "disguised employment".  With one client, and the ability to claim back expenses and VAT etc., it looks like it could be a tax avoidance scheme (at least to the authorities).  In the UK this is particularly a problem for people and I believe it's also the same in the USA.   There's a cat and mouse situation with the company owners (the mice) trying to avoid the attention of the authorities (the cat).

There's a more recent new dimension which is the severe tension between a single client billing and employment legislation.  For example (in the UK), Uber drivers were considered self-employed by Uber but in fact they were - according to employment tribunals - just disguised employees and therefore entitled to employment law protection (holiday pay, sick pay etc).  The issue for the government was that people were able to avoid paying higher rates of social taxes.  Ok, Uber isn't here but one can imagine similar situations evolving.

You know, that the minimum share capital for a "kft" is about 10.000EUR, right?