Home distilling in Hungary: what Is legal and what is not?

How much can be distilled at home?

Since January 1, 2021, every fruit grower household may legally produce up to 86 liters of fruit spirits per year tax-free. This option is also available to those who prepare the spirit at home from fruit grown in their garden. Legally, even a single fruit-bearing apricot tree qualifies someone as a fruit grower.

However, distilling equipment must be registered with the local municipality, and the intent to distill must be reported to the NAV. In return, the authority issues a certificate of origin, which verifies the authenticity of the spirit and is essential, for example, for entering a spirit competition. The law also requires that the home distiller be of legal age.

Who can consume the homemade spirit?

Homemade or contract-distilled spirits can only be consumed by the producer, their family members, close friends, and guests. Selling is permitted solely to an authorized excise warehouse. In other words, the spirit cannot be sold to a neighbor, but it may be consumed together with them. NAV officials often encounter illegal ads on social media where homemade spirits are offered for sale – this is against the excise law and subject to penalties.

Tax rules for sales

For sales to excise warehouses, specific tax rules apply. According to the Personal Income Tax Act, revenues up to HUF 600,000 per year are tax-exempt. Income must also be considered, with a general exemption threshold of HUF 1.2 million annually, below which no contribution payments are due. However, any revenue exceeding HUF 600,000 must be declared in the annual tax return.

Home distilling is permitted in Hungary but only under strict conditions. Spirits produced for personal use cannot be treated as commercial goods, while selling them requires proper authorization and compliance with tax regulations. Anyone who ignores these rules and sells homemade spirits risks penalties under the excise law.