Is a Hungarian accountant, tax code, TAJ card, etc needed?

There's a difference between the UK company (legal person) and an individual (natural person).   So they are taxed differently. This can be quite complicated as you can imagine.  I assume your friend is not an American or from the Philippines.

Basically if you live in Hungary more than 183  days within one tax year, then you are liable for Hungarian tax.   This is the same all over the European Union (and many others using the OECD tax model).   

If your friend comes and go and does work elsewhere outside  then this would be incidental to Hungary. Structuring the work is problematic.

The taxpayer can use taxes paid in one country against the taxes due in another according to the DTA (Double Taxation Agreement) between the UK and Hungary (in this case).  This has a hierarchy of tests for residence - for example if centre of social and family life is in another country.  The term normally used is "habitual".

There's going to be all sorts of effort required to sort this out.  The VAT reporting issues are painful.   It depends on where the work is actually done. 

Because it is so complicated and the language issues are so problematic in Hungary, your friend should seek the services of a professional accountant in both countries.  Advice should be obtained BEFORE the work starts.  Otherwise your friend could be severely clobbered.

While it's not quite the same I have actually turned down jobs in the past because the regulation was so high and the incentive so little, I couldn't be bothered with the overhead of dealing with it.  Admittedly that wasn't Hungary, it was Romania.  It was so ridiculous  and possibly would have taken me 4 weeks of admin just to get started and then 1 day a week to maintain the whole thing. I just gave up trying to work through their system and just went and did something else where people were less picky.

I second the suggestion that your friend needs to talk to an accountant or better an international tax attorney/solicitor directly. But, for what it is worth, she needs to contact one that specialized in international business (and I would recommend a larger international attorney or accounting firm that has offices in Hungary). I suggest this because too many of the regular accountants in Hungary I have talked to do not understand tax law outside of Hungary. And yes, to get correct advice will probably not be cheap. I paid 300 Euro an hour for 90 minutes of finally helpful advice from an attorney -- which, when all said and done, was actually cheaper than the wasted weeks of my time talking to accountants who had no clue.

And most important, she needs to clarify this:

HelenLancert wrote:

2) Is the Hungarian company hiring someone (her company) on contract and therefore an employer incurring a company expense, putting it down as hiring a service from the UK. Or is that the UK ltd company (my friend) who has a client/customer which they invoice as a routine job. Who is the employer and employee in this case?

Because what the contract says and how it is worded will determine if she will be classified as an "employee" in Hungary by a Hungarian company or her company is being hired to do the work, and she is the on site company representative.

HelenLancert wrote:

1) Do she need a Hungarian Tax Code and TAJ Card, for whatever reason(s)? I.e. maybe she will need to pay tax into the Hungary system and contribte towards its Social Security/National Insurance?

Basically, yes, if she is a working resident of Hungary as already described by fluffy. How much she will pay will depend on the contract specs, her company structure (i.e. how the company pays for her compensation), etc. etc. etc.

klsallee wrote:

.... I would recommend a larger international attorney or accounting firm that has offices in Hungary). I suggest this because too many of the regular accountants in Hungary I have talked to do not understand tax law outside of Hungary. And yes, to get correct advice will probably not be cheap. I paid 300 Euro an hour for 90 minutes of finally helpful advice from an attorney -- which, when all said and done, was actually cheaper than the wasted weeks of my time talking to accountants who had no clue.

I second that. 

One of my close relatives was provided by his employer with international tax advice as part of his moving package between countries - in his case, from Thailand to Singapore.

If I recall correctly, he saved himself £30,000 from that 1.5h chat (but of course he wasn't paying a very high rate personally for that advice). 

You can get totally messed up by asking a UK accountant to recommend a Hungarian accountant. All they do is look in their Big Book of Accountants and charge you for the privilege in 6 minute chunks (well, it was how I was charged).