MONEY.HU: What can we expect from the planned apartment cafeteria program

By: Trademagazin Date: 2024. 11. 06. 10:55

As part of the New Economic Policy Action Plan, in order to improve national housing conditions, the Government has again started to work out the tax-reduced housing subsidy introduced by the employer on January 1, 2019, with a deadline of November 30. The money.hu experts examined the structure of the previous support form and highlighted some open questions regarding the introduction of the new non-wage allowance.

Within the implemented apartment cafeteria system, employers could give their employees two types of tax-free, extra-wage support.

The purpose of the previous tax-free sublet subsidy (officially known as: housing subsidy for mobility purposes) was to enable the employee to work further away from their place of residence, thereby facilitating the flow of labor and the mobilization of the workforce. Starting in 2018, the tax-free sublet subsidy could be claimed for 5 years after the creation of the employment relationship, the amount of which was tied to the current minimum wage. In the first two years, 60% of the current minimum wage, 40% in the third and fourth year (2020), and 20% in the fifth year could be paid for the purpose of housing support to promote mobility. The most important criterion for the tax-free sublet subsidy was that the employee fulfill at least one of the following conditions: live at least 60 kilometers from the place of work, or live at least three hours away from the place of work by public transport. In addition, those who owned an apartment nearby could not receive tax-free support either.

Within the framework of the former housing employer subsidy, a maximum of HUF 5 million could be paid over a five-year period for the purchase, construction, expansion, modernization, and accessibility of a home, but it could also be used to repay the employer’s housing loan or a loan taken out from a previous employer or credit institution. The maximum amount of the support could be no more than 30% of the property’s purchase price, total construction costs, or the costs of modernization and accessibility.

“Employers and employees alike can benefit from the appearance of a properly developed program with a simple administration for use by a wide range of employees. Since employees usually have to pay for housing in some form, it does not matter whether they can do so from their taxed income or from an allowance provided specifically for this purpose, so it can also be an important tool in retaining employees. When taking out a loan, the cafeteria elements supplementing the salary are taken into account by the banks as secondary (additional, not entitling to a loan in itself) income. The amount of the cafeteria can amount to a maximum of 30% of the total acceptable income”

said Levente Korponai, head of money.hu.