Family Tax Credit as a Sole Trader: How Can You Claim It?

Many people only know the family tax credit as a deduction from wages, but as a sole trader (egyéni vállalkozó, EV), you may be entitled to it too — the way you claim it is just different from an employee's.

Who Is Eligible for the Family Tax Credit?

Eligibility fundamentally depends on the number and type of children (dependent, beneficiary dependent), and on whether you have an eligible month in the given year. This applies to sole traders the same way it applies to employees — the credit reduces your SZJA (personal income tax) base, regardless of what kind of legal relationship your income comes from.

Important: the concepts of "beneficiary dependent" and "dependent" aren't the same — the amount of the credit depends on the number of dependents, but not every dependent entitles you to the same credit amount. If you're unsure about your own situation, it's worth checking NAV's (the Hungarian Tax Authority's) current guidance or asking an accountant.

How Can You Claim It as a Sole Trader?

The mechanism differs slightly depending on your tax form:

Under flat-rate tax: the family credit reduces the SZJA owed on your flat-rate tax base (the portion of your revenue, after the cost ratio, that counts as your tax base).
Under VSZJA (personal income tax based on actual business profit): the credit reduces the SZJA base on your withdrawn profit or income.
Under KATA (the flat-rate tax scheme for small businesses): since KATA is a fixed, itemized tax that isn't SZJA-based, the family credit can't be claimed directly through this tax in this form — instead through another channel (e.g. a spouse's income, or if you have another source of income) — this requires more detailed consultation with an accountant.

Can It Be Shared With a Spouse?

Yes — under certain conditions, the family tax credit can be shared between spouses/partners, or transferred to whichever party has the larger tax base, if one party alone can't fully claim it. This can be especially relevant if one party is a sole trader with a lower tax base, and the other is an employee with a higher salary.

What to Watch For

Keep accurate records of your eligible months — if your family status or number of children changes during the year, this affects the amount you can claim.
Coordinate with your spouse/partner on who claims the credit — if you'd both be eligible, it's worth deliberately deciding how to split it.
If you're on KATA, look at your options separately — the mechanism here is less straightforward than under flat-rate tax or VSZJA.
Don't forget to actually enter the credit when preparing your return — it isn't applied automatically, you have to claim it yourself.

Penzum Helps

Based on the family data recorded in Settings (number of dependents, beneficiary dependents), Penzum automatically builds the family tax credit into the tax calculation, both for actual and scenario-based calculations — so you can immediately see how much it affects your real tax burden.

Not sure about your own situation? You can find more detailed material on claiming the family tax credit in the Penzum Help Center. (exact link pending verification and insertion)