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Off topic: Living in Hungary
Thread poster: Williamson

Williamson  Identity Verified
United Kingdom
Local time: 05:40
Flemish to English
+ ...
Jul 10, 2008

One of my options in life is to move and live in Hungary. A small farm/house with a view on lake Balaton or in the vicinity of the lake, is appealing.
What about taxes in Hungary. It does not make sense to buy a small farm or a house and having to pay high taxes (VAT =20%) on that house. It does not make sense to work hard and at the end of the year having to pay a big chunk of one's income to the authorities.
Translation is an activity which is only viable is the tax-pression on the activity is not too high.
As far as I know Hungary is a high-taxed country? An income of : +18 Mio Florint means 30% taxes?
What about the mentality of the people. Is everybody cooconing in one's own house or is there a social life?


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Marion Rooijmans
Netherlands
Local time: 06:40
English to Dutch
+ ...
Go and find out Jul 10, 2008

Williamson wrote:

What about the mentality of the people. Is everybody cooconing in one's own house or is there a social life?


I don't know anything about taxes in Hungary (or taxes in general, you could say), but if you want to know what the people in Hungary are like, I think you should go there and find out. Don't just spend a holiday in Hungary, but present yourself as someone who is looking to live and work there for an extended period, possibly the rest of your life. Everything seems nice when you're a tourist, but things can be very different when you're part of every day life. Visit small events that don't attract too many tourists and talk to locals. I think you will soon find out if that's the life you're looking for.


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Wolfgang Jörissen  Identity Verified
Belize
Member
Dutch to German
+ ...
Language gap Jul 10, 2008

Do also keep in mind that without any knowledge of Hungarian, you will have to rely on people to take care of your "bureaucratic affairs". This can be someone from your own social network or a paid professional (who may be a significant cost factor).

Talking about low taxes... have you thought about neighbouring Slovakia? Nice country, no doubt about that, and you will do business in Euro as from next year.

[Edited at 2008-07-10 08:18]


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Csaba Ban  Identity Verified
Hungary
Local time: 06:40
Member (2002)
English to Hungarian
+ ...
why bother about taxes? Jul 10, 2008

As a freelancer translator, you can work pretty much anywhere as long as there's broadband internet. You could even keep your own company or enterprise back home, issue invoices from your home country, pay taxes to your home country (or the country of your choosing), etc.

Living in a house overlooking the Balaton Lake: quite a few people have weekend houses in this region, but hardly anyone lives here the whole year. There's a more or lively social scene in the summer months, but only as long as you know some people around. (i.e. people drive to each other's place, and continue partying just as they do from September to May in Budapest or other cities.) The region is rather slow between October and April.

One issue you have to deal with is internet connection. If you choose a remote place, you may have serious difficulties in finding a reliable provider, or even having a cable drawn out to your house. Mobile internet is catching up, and I think now all three GSM providers have solutions for this. (www.t-com.hu, www.pannongsm.hu, www.vodafone.hu).


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Cyril Georget
France
Local time: 06:40
English to French
+ ...
Hello William Jul 10, 2008

I have chosen to live in Hungary since 2006 now and I am very pleased to live there.

But well, maybe Balaton is just a dream for everyone here. Why Balaton ? there are very beautiful places near the Danube or other lakes in Hungary. But the point is that Budapest is the big cultural center in Hungary for cafés and cinema... Though the people are much more kind and cool in the countryside I think...

For taxes I believe like the others that it is not a problem : taxes on the house ? Indeed when you buy the house there are not a lot of taxes. It depends of the location whereas Balaton seems to be the worst place for taxes payers...

I would be delighted to help you in your so nice project

Cyril

[Modifié le 2008-07-10 09:36]


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RobinB  Identity Verified
Germany
Local time: 06:40
German to English
VAT on house purchases? Jul 10, 2008

Williamson wrote: It does not make sense to buy a small farm or a house and having to pay high taxes (VAT =20%) on that house.


Sounds grim. Which countries charge VAT on private residential property transactions? OK, an estate agent's fee will normally contain VAT, but that sort of thing is usually negotiable nowadays anyway.

It does not make sense to work hard and at the end of the year having to pay a big chunk of one's income to the authorities.


Somehow I have the feeling I've seen this before. In Germany, you typically won't pay more than a composite tax rate of 30-35% after all your deductions have been factored in, even for a taxable income of EUR 150k. That's reasonable, isn't it? Especially since the cost of living in Germany is one of the lowest in Northwest Europe.


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xxxJon O  Identity Verified
United Kingdom
Local time: 06:40
Dutch to English
+ ...
Coping with Hungarian? Jul 10, 2008

It would be interesting to hear from those foreigners living in Hungary how they cope living in a Hungarian language environment given the supposed extreme difficulty of learning Hungarian as a foreign language (a result of its complete lack of relation to the Indo-European family and its intimidating grammatical complexity). How long does it take to acquire anything like a useful level of competence in the language?

Cheers,


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Williamson  Identity Verified
United Kingdom
Local time: 05:40
Flemish to English
+ ...
TOPIC STARTER
Several Choices. Jul 10, 2008

Hungary is just one option. House prices are reasonable, but when you add 20% VAT on properties, they are less reasonable.
With regard to the fact that I can write invoices anywhere, that is true. I operate as a legal entity (ltd.) and that entity's seat will not move, unless I get better fiscal conditions. But will the Hungarian state not ask questions as to where I get my income from. Perhaps a small parti-time job might solve that problem.
*-*-*-
VAT on houses is compulsory everywhere in the E.U. When it agreed with the "Acquis Communautaire", even the lowest taxed-EU-country, Cyprus had to introduce 15%-VAT on houses ??? Or is there no VAT on houses, only on the services of a real-estate agent?
*-*-*--
I most certainly have considered Slovakia.
A flat tax of 19%.
Reasonable property prices+VAT.
*-*-
Cyprus is also upon my list. Greek and Turkish as official languages, English as semi-official language and a tax-rate of 10%, 300 days of sunshine, but high real-estate prices.
Other options are a couple of islands in the Caribbean, unfortunately also high real-estate prices. Seems like everybody wants to live in fiscally friendly places.

Outside Europe: I have always had an interest in the Far East (China, Japan) and martial arts. I have a friend living in Shanghai. A decade ago I strolled around in Beijing, Hong-Kong, Tokyo and Los Angeles. A stressful life in megacities does not appeal to me. Pity, I cannot afford Yorba Linda, California
*-*-*--*-
“Shame on me”, because besides “unethical” as I am, because as a weekend activity, I would like to open something like www.fun4two.nl. only not so luxurious and fill the rest of the week with translation, interpreting and training.
*-*--*-
Some houses , I have found in Hungary lend themselves to such activity. Some in Slovakia also. Whether the local population would be happy with it, remains a ????

Yes, learning Hungarian seems a daunting task. However ,the language has at least 1 advantage and that is that it uses the abc-alphabet, so that unlike Chinese you don't have to learn at least 4000 characters with 4 different pronunciations.
From experience I know that when you have to learn a language for daily use, this goes a lot faster than study in an academic environment.
Of course, the syntax is one of those things to be acquired in an academic way. Otherwise, you end up with understanding words, but not being able to use the structure.
I have the impression that bureaucracy will be a big obstacle if I choose for Eastern Europe.

[Edited at 2008-07-10 14:41]

[Edited at 2008-07-10 14:43]


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RobinB  Identity Verified
Germany
Local time: 06:40
German to English
Misunderstanding? Jul 10, 2008

Williamson wrote: VAT on houses is compulsory everywhere in the E.U. When it agreed with the "Acquis Communautaire", even the lowest taxed-EU-country, Cyprus had to introduce 15%-VAT on houses ??? Or is there no VAT on houses, only on the services of a real-estate agent?


VAT is charged on new builds only (plus, of course, renovation work, that sort of thing). And do remember that most house sales are private-to-private, even if an agent is used. VAT is levied on fees and commissions, sometimes even on the land transfer tax, depending on the country.

With regard to the fact that I can write invoices anywhere, that is true. I operate as a legal entity (ltd.) and that entity's seat will not move, unless I get better fiscal conditions. But will the Hungarian state not ask questions as to where I get my income from. Perhaps a small parti-time job might solve that problem.


You would have to pay Hungarian income tax (and possibly other taxes as well) on your income from the UK Ltd. The situation is no different to the owners of the tens of thousands of UK Ltd. companies now owned by German residents: they still have to pay German taxes!

Seems like everybody wants to live in fiscally friendly places.


Which is why the most attractive locations are way beyond the financial resources of most translators or interpreters. If you want low taxes, good weather and a global language, you have to pay for it!


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Williamson  Identity Verified
United Kingdom
Local time: 05:40
Flemish to English
+ ...
TOPIC STARTER
Dream on... Jul 10, 2008

RobinB wrote:

[quote

You would have to pay Hungarian income tax (and possibly other taxes as well) on your income from the UK Ltd. The situation is no different to the owners of the tens of thousands of UK Ltd. companies now owned by German residents: they still have to pay German taxes!

Seems like everybody wants to live in fiscally friendly places.


Which is why the most attractive locations are way beyond the financial resources of most translators or interpreters. If you want low taxes, good weather and a global language, you have to pay for it!


Not if I "forget" to notifiy the Hungarian or whatever authorities and look for a normal part-time job and live from that income.
Never heard of a virtual office and company. A legal person is different from me, the "natural person" and with the internet you can have your invoices written and send anywhere on the planet. In name, the legal person, i.e. the ltd remains in the UK, a secretarial firm takes care of the paperwork and as it is the case now, a British accounting firm fills out the balance sheet and tax-papers for HMCR. 100% legal and ok for the UK.
Unless I move to Cyprus or a sunny tax-haven in Caribbean, everything remains as it is, no matter whereon the planet I am.








[Edited at 2008-07-10 16:31]


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Jim Tucker  Identity Verified
United States
Hungarian to English
+ ...
Not such a tough nut Jul 10, 2008

Jon O wrote:

It would be interesting to hear from those foreigners living in Hungary how they cope living in a Hungarian language environment given the supposed extreme difficulty of learning Hungarian as a foreign language (a result of its complete lack of relation to the Indo-European family and its intimidating grammatical complexity). How long does it take to acquire anything like a useful level of competence in the language?

Cheers,


This is something one often hears, but the fact is that Hungarian is far more regular than any Indo-European language I have ever seen. Particularly for someone with aptitude in languages, I think you would have to say that Hungarian is very "learner-friendly"- except for the initial phases, when vocabulary is often unfamiliar. Otherwise, one present tense,one past tense, no gender, predictable system of agglutination, very few irregularities. Just a few quirks - but far fewer than French, say.

As an editor of the New Hungarian Quarterly once said to me, "Hungarian is one of the few languages that you can actually learn out of a book."

That said, every language is of course an endless odyssey.

[Edited at 2008-07-10 18:31]

[Edited at 2008-07-10 18:42]


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Madeleine MacRae Klintebo  Identity Verified
United Kingdom
Local time: 05:40
Swedish to English
+ ...
Interesting subject until... Jul 10, 2008

You moved to a very shady/grey/black area as regards taxation.
Williamson wrote:
Not if I "forget" to notifiy the Hungarian or whatever authorities and look for a normal part-time job and live from that income.
Never heard of a virtual office and company. A legal person is different from me, the "natural person" and with the internet you can have your invoices written and send anywhere on the planet. In name, the legal person, i.e. the ltd remains in the UK, a secretarial firm takes care of the paperwork and as it is the case now, a British accounting firm fills out the balance sheet and tax-papers for HMCR. 100% legal and ok for the UK.

If you're serious about this, I suggest you start by studying Hungarian law. Particularly the sections about wilful tax evasion - is the punishment a small fine and a slap on the wrist or 10 years hard labour? If they start investigating your situation and find this thread, you can hardly claim ignorance.


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Williamson  Identity Verified
United Kingdom
Local time: 05:40
Flemish to English
+ ...
TOPIC STARTER
Business practise. Jul 11, 2008

I have not chosen for Hungary yet. Another of my options is to go and sit at acquaintances outside the E.U. = tax-free after a number of months.
But first formulate, then calculate and then decide.
I don' do things for the "love of".
I'll put my choices with the pros and cons in a spreadsheet.
If there is too much tax-pressure or if there are too much rules and regulations that rules out that possibility.
Never heard of a legal person i.e. a separate entity from a natural person (me)?
That legal entity (ltd., S.A. or whatever) does not have to live where the natural person of flesh and blood lives.
That is common business practise.
Or do you think that the CEO of a medium-sized translation company like TP llc.writes all the invoices herself?
*-*-*-
I still haven't a clue about Hungarian tax-levels. Are they so high that nobody dares to answer ?



[Edited at 2008-07-11 06:53]


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RobinB  Identity Verified
Germany
Local time: 06:40
German to English
The tax people are cleverer than you think Jul 11, 2008

Williamson wrote: Not if I "forget" to notifiy the Hungarian or whatever authorities and look for a normal part-time job and live from that income.


and quite possibly cleverer than you. The amount of tax information that's exchanged across borders nowadays, not only within the EU but also e.g. between the EU and the USA, is phenomenal.

Never heard of a virtual office and company. A legal person is different from me, the "natural person" and with the internet you can have your invoices written and send anywhere on the planet. In name, the legal person, i.e. the ltd remains in the UK, a secretarial firm takes care of the paperwork and as it is the case now, a British accounting firm fills out the balance sheet and tax-papers for HMCR. 100% legal and ok for the UK.


Of course, if your Ltd. doesn't pay you a salary and doesn't distribute any profits to you, then you won't have any taxable income from it, irrespective of where you live. But if it pays you a salary or profits, and you're not a UK taxpayer, HMRC will most likely disallow those expenses unless it's given documentary evidence of your foreign residence, in which case it will most likely pass the information on to that country's (EU) tax authorities. It will also most likely put the Ltd. onto a money laundering watchlist until it's satisfied that everything is above board.

I'm sure you know that tax fraud is a serious offence and - as our own tax auditor confirmed to us recently - translation agencies, translators and interpreters are firmly in the spotlight now, so I do take your remarks about "forgetting" to pay tax with an extremely large pinch of salt

But the notion of living somewhere really nice while translating is extremely tempting. At the moment, I'm sort-of thinking of a reasonably large yacht stationed somewhere in the Caribbean, at least before I get too old to handle the thing. Maybe when I've semi-retired...


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Williamson  Identity Verified
United Kingdom
Local time: 05:40
Flemish to English
+ ...
TOPIC STARTER
Your grain of salt Jul 11, 2008

Wie gut die deutsche Behörden, die von 9-5 arbeiten sich auskennten mit dem (Europäischen) Ausland habe ich in den 90.Jahren erfahren: „Nicht so gut“.
*-*-*-
It is a big world and I am able to communicate fluently in 5 languages.
I do not have any relationship, children, ties or obligations and can go anywhere on the planet where it suits me best and where I can pay for it.
That gives me a lot of opportunities to choose from. I am only bound to a state by a passport and once outside the E.U., there is no obligation to register at the local embassy to get your passport renewed.
Why do you think that some translators are situated on the Dominican Republic?
I never said, I did not intend to pay taxes. When it makes profit, the ltd.pays its taxes to HRMC.
It is all about the money and when authorities see money, they are happy.

[Edited at 2008-07-11 10:26]


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