The Hungarian financial support system (Motion Picture Act and Corprate Tax Act) has two pillars: indirect state support (tax incentives for films and related projects) and direct state support (for local films or co-productions).

Only feature films, short films, documentaries, science, nature and animated films, made-for-TV movies and TV series are eligible.

Tax rebate is 25% (from 2014.06.25) of the eligible Hungarian spend

Eligible spend includes all payments contained in the budget that were paid to a Hungarian taxpayer

• Direct pre/post and production expenses paid by the qualified Hungarian production
• Wages, above- and below-the-line, when paid by the qualified Hungarian production
• Financing costs, and administration, insurance, completion bond, accommodation, etc. costs

Items excluded by the law are

• Indirect costs (eg. A&P) over 2% of the overall spend (max 17 kEUR)
• Costs incurred after the master print (distribution)
• Royalties are limited to 4% of the Hungarian budget of the film
• Producers’ fees are limited to 4% of the Hungarian budget of the film

Up to 25% of the eligible spend can be foreign spend which also qualifies for the 25% (from 2014.06.25)  tax rebate.

Total state subsidies shall not exceed 50% of the production budget, or in case of

• Co-productions 60% (from 2014.0625.) of the Hungarian contribution in case another European Economic Area member state’s registered film production company participates in the co-production
• Co-productions 100% (from 2014.06.25) of the Hungarian contribution in case another OECD member state’s registered film production company participates in the co-production
• Low-budget films and films produced in Hungarian language the extent of subsidies is 100% (from 2014.06.25)
• Documentaries, animation, shorts, experimental films etc. 100%

The tax rebate is a non-recourse, non-repayable and non-recoupable cash rebate.

To read more about the registration & qualification process and the claims cycle, please click here to download our full tax incentive guide.