Policies governing the operation of businesses in Hungary

What should you know about policies in general, and which policies should you prepare?


Having a multitude of policies is an integral part of the life of every business, along with constantly revising them and preparing new ones. The first of these policies, although it has a different name, is the articles of association. When founding a company, the owners lay down the basic rules defining the operation of the company in the articles of association: among other things, the tasks and powers of the main body of the business (members’ meeting, general meeting), the head of the business (managing directors, directors) and the supervisory board (if any).

The business may start working based on the articles of association, but the definition of the necessary rules and policies does not end here. Beyond the requirements relevant for all businesses, compiling additional policies is also mandatory in Hungary depending on the activity of the business.

General characteristics of policies

What all policies have in common is:

  • they have to be prepared or you have to have them prepared by an appropriate professional, by the deadlines specified in law, with the content defined by laws and regulations but taking account of the specific features of the business,
  • the appropriate executive body of the business has to approve them and put them into effect,
  • their content and requirements have to be made known to the persons concerned, namely, the employees to whom they apply,
  • the rules prescribed in them have to be applied,
  • it is best to check policy compliance, and in many cases, even an external party (auditor) or a state authority also checks them regularly,
  • in the event of any changes in the law or in the life of the business, the relevant change has to be incorporated in the policies.
Most important policies

All Hungarian businesses have to prepare their accounting policies which form the basis of the company’s bookkeeping, reporting, accounting settlements and valuations.

As for taxation, pricing principles and methods related to intragroup transactions should be determined in a transfer pricing policy, which can be the basis for the company’s transfer pricing documentation.

When managing the personal data of private individuals, be they employees or clients, or when using websites, newsletters, webstores or cameras, the business may need a data protection and processing policy prepared based on the GDPR. This policy contains the requirements of data protection and data processing, the sample communication to be provided to private individuals, and a sample of the consent of private individuals to data processing.

Employers must ensure safe working conditions for employees that are not hazardous to human health. The necessary requirements are included in the health and safety and fire safety policy of the business which define the rules of conduct for work, the health and safety procedures as well as any measures to take in the case of accidents or fire at the workplace.

If the employer provides fringe benefits (local public transport passes, SZÉP cards etc.) for its employees, a fringe benefit policy also has to be prepared in Hungary. In this policy, the employer defines who is entitled to fringe benefits, the types of benefit the employee can choose from, the allowance available for the employees and the forms and invoices, etc. needed to claim the benefits.

The policy for temporary foreign and domestic postings provides for the process of approving work-related travel, accountable costs arising during the travel, and daily allowances.

If the business provides a company car for an employee, its company car policy will record the conditions for the private and business use of the company car along with the accountable costs and any reimbursements payable.

Other policies

In addition to the above, of course, there may be other policies related to the operations of the business, either recommended or mandatory, required by law (codes of ethics, policies related to quality management systems such as ISO, HACCP), and it is worth gathering information about these when planning the activities of the business.

It can make life easier for all businesses if they have a complex business adviser to help them find their way among the multitude of policies required. The accounting, legal, tax and payroll specialists at WTS Klient Hungary have significant knowledge and experience in their respective fields, and in constant consultation with each other, they are ready to assist you in preparing any of the policies summarised in this article.

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