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Background:
The quarterly meeting of the finance department of a Swiss group will take place in the summer of 2024 at the location of the Hungarian subsidiary. The meeting will last 4 days and employees from various European company locations are expected (UK, Switzerland, and Germany).
The travelling employees have British, Swiss and German citizenship.
All costs for the business trips (flight, hotel, other expenses) will be borne by the respective national companies.
Question:
What do the respective HR departments have to consider or undertake from an administrative point of view regarding employees' business trips?
Administrative aspects:
Work permit
First of all, it must be checked whether the travelling employees require a work permit for Hungary. If it is only for meetings and discussions, German and Swiss nationals can travel to Hungary without hindrance.
British nationals can also attend the quarterly meeting without additional work permits. For these nationals, however, it must also be noted that they may stay in the Schengen area for a maximum of 90 days within a 180-day period.
Posted Worker Notification
According to the Hungarian interpretation of EU law, business trips are not subject to the notification procedure or "Posted Worker Notification". As long as it is "only" a quarterly meeting, it is not necessary to make further registrations in Hungary.
Income Taxes
Due to the short duration of the quarterly meeting, the employment of the employees abroad and the assumption of travel expenses by the foreign companies, it is assumed that the employees will not be subject to tax in Hungary.
Their income can, therefore, be taxed as if they had worked exclusively in their respective home countries (UK, Switzerland, and Germany).
Social security
As with other (short) foreign assignments of employees, it is also necessary to obtain the relevant social insurance certificates in order to document the employee's inclusion in the social insurance system of the home country and exemption from Hungarian social insurance.
The application for the A1 documents or for the Certificate of Coverage must be made in the respective home countries of the employees via the responsible HR department before the business trip.
Conclusion
The business trips for the British, Swiss, and German employees from the respective national companies to the quarterly meeting in Hungary are not critical from an administrative point of view.
Only the A1 documents or the Certificate of Coverage should be obtained before the foreign assignment, and care should be taken to ensure that the British nationals comply with the Schengen regulations for their entry and stay in the Schengen area.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
