• Bilateral social security agreement with Hungary

    If you send an Australian employee to work temporarily in Hungary, you must continue to pay superannuation guarantee contributions in Australia for them.

    Before you send the employee, apply to us for a certificate of coverage:

    We'll issue a certificate to you on the basis that you'll continue to make super guarantee contributions in Australia for the employee. You or your employee then show the certificate to the Hungarian authorities to be exempted from super payments in Hungary. The certificate can cover a period of up to four years.

    When completing the request for a certificate of coverage, you'll need to provide an Australian contact name and their phone, fax and e-mail details.

    When you receive the certificate, keep a copy for your records and give the original to your employee to take with them to Hungary.

    On this page:

    About the agreement

    Our bilateral social security agreement with Hungary applies when double super coverage occurs – that is, when you or your employee would otherwise have to make super guarantee contributions (or equivalent) in both countries for the same work by your employee. It applies to Australian super guarantee law and Hungarian social security laws.

    For information about:

    The agreement started on 1 October 2012. The agreement can also apply to people sent to Hungary or Australia for work before this time, but only for super guarantee contributions (or equivalent) made on or after 1 October 2012.

    Example

    Ema is an Australian resident working in Australia for her Australian employer. Ema's employer sends her to work in Hungary for two years, starting 1 July 2012. As Ema's employer must make super contributions for her under Australian super guarantee legislation, Ema and her employer are exempt from making social security contributions under Hungarian law from 1 October 2012.

    Any compulsory contributions under Hungarian law for the period before 1 October 2012 must still be made. Therefore, Ema and her employer must make social security contributions under Hungarian law for the period from 1 July 2012 to 30 September 2012.

    End of example

    Effect for different types of employee

    Employees working temporarily overseas

    If you send your employee to work in Hungary for a period not exceeding four years – for your business or a related entity – and double super coverage occurs, only the super laws of your home country will apply. This means super guarantee contributions (or equivalent) are required only under the law of the country that your employee is most likely to retire in.

    This rule also applies if the employee is sent to work for a related company and double super coverage occurs.

    Government employees working temporarily overseas

    If a government employee is sent to work temporarily in Hungary and double super coverage occurs, only the super laws of Australia will apply.

    Self-employed people

    The agreement doesn't apply to self-employed Australian residents working in Hungary. They're not subject to super guarantee law in Australia, so double super coverage doesn't occur.

    Diplomats

    The agreement doesn't affect the treatment of diplomats and consulate officials under the relevant Vienna Conventions on diplomatic and consular relations.

    Extension beyond four years

    Generally, a certificate of coverage will cover Australian employees for up to four years employment in Hungary. If you need coverage for longer than four years, you'll need to write to us explaining the reasons for the extension.

    Approval to extend a certificate of coverage is determined on a case-by-case basis. We can grant an extension only with the mutual agreement of the relevant agency in Hungary, and only in certain circumstances.

    An extension may be granted when:

    • an individual who was scheduled to replace the employee is unable to do so because of death, serious illness or resignation
    • the employee must remain in the country of secondment due to an unexpected personal situation – this includes medical reasons (self, spouse or children) or if the employee's children must stay to complete the school year
    • the employee has been under one country's social security system throughout their career and is planning to retire in the immediate future
    • the extension is for a short period
    • the employee returned to the country of origin for a short period during the period of secondment for unexpected personal reasons – this includes medical reasons (self, spouse or children)
    • the extension for work purposes would be in the national interest of either country
    • cessation will cause undue hardship to the employer or employee
    • there has been a reorganisation of a company and the employee maintains an important role in the reorganisation
    • the employee has special skills or background, and the employer makes a strong case for needing the employee to complete a special assignment or project that will be finished within one to four years following the four-year secondment period.

    An extension may also be granted in other special circumstances.

    Your request for an extension must be in writing and should include the:

    • employer's name, ABN and contact details
    • employee's name
    • certificate number
    • reason for the extension.

    Send your request to:

    Superannuation – Bilateral agreements
    Australian Taxation Office
    GPO Box 9977
    ADELAIDE SA 5001
    AUSTRALIA

    See also:

      Last modified: 27 Jul 2016QC 26560