First, though, it is worth remembering that, due to the frequently changing rules, assessing the possibilities with the help of experts to achieve the greatest possible tax savings is strongly recommended. The allowance is not a direct cash subsidy, but a form of tax relief, which means that the amount of the subsidy depends on the business’ profitability and the tax payable. Taxation for the coming years must be carefully planned to ensure that the allowance can be used and not just remain a possibility.

Most businesses are only familiar with the development tax credit, and due to its high minimum investment value of HUF 1 billion-3 bln, many believe it is out of reach for them. However, the “entry investment” thresholds are lower for environmental protection and energy efficiency developments.

Most importantly, investments serving energy efficiency goals that qualify for tax benefits are not limited to new investments, but also apply to renovations. They can include building insulation, window and door replacement, air conditioning upgrades, and the installation of equipment producing energy for own heating, cooling and industrial heat production (i.e. solar collectors, heat pumps, and biomass equipment). However, solar panels that generate electricity and energy-producing equipment using fossil fuels (such as gas boilers) are not eligible for support, nor is district heating and cooling. The maximum value of the investment is equivalent to EUR 30 mln in Hungarian forints.

The rules differ depending on whether the investment is in buildings or non-buildings. For non-building projects, the acquisition cost and increase in value of tangible and intangible assets are eligible costs. For projects related to buildings, an increase in efficiency, measured in terms of primary energy (energy occurring in its natural form), is expected, whether the energy source is renewable or non-renewable. The direct costs of the investment or renovation are eligible; the aid intensity is 15%, which may be higher in the case of SMEs.

A tax credit can also be used for installing electricity storage facilities with an aid intensity of 30% (even higher for SMEs), provided that at least 75% of the energy fed into the grid comes from renewable sources. The value of the investment may not exceed EUR 30 bln.

Finally, tax base allowances related to the establishment of electric charging stations are gaining increasing popularity. This incentive can be applied to the total investment value of stations by deducting twice the costs incurred from the corporate tax base. However, this is considered “de minimis” aid.

In the case of independent environmental protection investments, allowances are available for investments of at least HUF 100 mln that serve to reduce environmental impact, protect health, or conserve natural resources. No additional commitment is required in terms of headcount, turnover, or wage costs.

There are many factors to consider; a tax advisor experienced in the field can answer these questions and help you make informed decisions on these issues.

LeitnerLeitner and LeitnerLaw have a long tradition of offering their clients high-quality full-scope consulting (including tax, accounting, payroll audit and legal services) in Central Europe. Creating integrated and multidisciplinary one-stop solutions is a crucial element of our client-focused approach to the needs of private clients, SMEs and corporate groups on general and specific questions.

This article was first published in the Budapest Business Journal print issue of October 3, 2025.