A severance pay<\/strong> a one-time cash benefit paid by the employer to the employee upon termination of employment. It is not due in every case \u2014 eligibility is regulated by Section 77 of the Labor Code (Mt.) and is subject to several conditions. The purpose of the benefit is to ensure that the employee is not left entirely without income after losing their job and has time to find a new position.<\/p>\n Many people have heard of severance pay<\/strong>, but few know exactly when it is due, how much it amounts to, and how to calculate it. This guide answers all essential questions based on the 2026 rules, referencing the Labor Code and the applicable tax regulations.<\/p>\n If you want to quickly calculate the amount you are entitled to, use the szamologep.hu severance pay calculator<\/strong>\u2014 and after reading the guide below, you will know exactly what the resulting figure means.<\/p>\n A severance pay<\/strong> is not automatic. The law precisely defines the cases in which there is an entitlement to it. The table below summarizes the most common cases.<\/p>\n A severance pay<\/strong> as a general rule, it is due if the employer terminates the employee's employment. However, two conditions must also be met:<\/p>\n If these conditions are met, the employee is entitled to severance pay<\/strong>, provided that the employment relationship has lasted at least 3 years<\/strong>. at the time of termination. This means that ordinary termination initiated by the employer is the most common legal basis for severance pay.<\/p>\n A severance pay amount<\/strong> the employee is not entitled to it in the following cases:<\/p>\n Important warning:<\/strong> In the case of mutual agreement, the parties may agree on anything \u2014 if the employer offers a mutual agreement instead of termination, it is worth having the agreement reviewed by an expert (labor lawyer), because you may lose your entitlement to statutory severance pay. Always seek legal advice before signing a mutual agreement document!<\/p>\n<\/blockquote>\n A severance pay amount<\/strong> depends on the time spent in the employment relationship. The Labor Code provides a clear table for how much severance pay is due after how many years of employment. The longer you worked for the same employer, the higher the amount you can expect.<\/p>\n Based on Section 77 of the Labor Code, the amount of severance pay<\/strong> is as follows:<\/p>\n A severance pay calculation<\/strong> is based on the absence pay. Absence pay is a concept under the Labor Code, which includes:<\/p>\n Therefore, absence pay does not always match the monthly gross salary, but for most employees, it is practically the same.<\/p>\n A severance pay calculation<\/strong> is done with a simple formula that anyone can easily apply:<\/p>\n Severance pay amount = Absence pay \u00d7 Number of months due based on years worked<\/strong><\/p>\n<\/blockquote>\n Suppose your monthly absence pay is gross HUF 500,000 and you have worked for the same employer for 14 years:<\/p>\n For an accurate calculation, use the szamologep.hu severance pay calculator<\/strong>which calculates the amount due to you in seconds based on the 2026 rules.<\/p>\n A taxation of severance pay<\/strong> in 2026 also follows the rules of personal income tax and social security contributions. The most important points:<\/p>\n A severance pay<\/strong> is taxed similarly to wages. After the payment, 15% PIT must be paid. However, the law caps the amount of severance pay that can be taxed tax-free or at a reduced rate, so it is advisable to seek the help of a tax expert for an accurate calculation.<\/p>\n A when calculating severance pay<\/strong> contributions must also be considered:<\/p>\n These contributions reduce the net amount received from the gross severance pay.<\/p>\n Let's calculate a specific case for the full picture:<\/p>\n Initial data:<\/strong> Deductions:<\/strong> Note:<\/strong> This is a simplified calculation. The exact net amount depends on tax benefits (e.g., family tax allowance, allowance for raising four or more children) and individual circumstances. For the exact amount, use the szamologep.hu severance pay calculator<\/strong>about.<\/p>\n<\/blockquote>\n Severance pay received after four years corresponds to one month's salary. This amount can help bridge the first month of job searching.<\/p>\n After eight years, two months' worth of severance pay is due, which can provide significant financial security during the transition period.<\/p>\n This amount represents a substantial financial reserve that can cover living expenses for up to six months during job searching.<\/p>\n To calculate the exact net amount, use the szamologep.hu severance pay calculator<\/strong>about, which calculates based on 2026 tax rules.<\/p>\n<\/blockquote>\n Many people confuse severance pay<\/strong> with sick leave and sick pay, but these are completely different benefits. The comparison below helps clarify:<\/p>\n A severance pay<\/strong> is related to the termination of employment, not illness. If you are on sick pay and your employer terminates your employment, you may receive benefits under both entitlements \u2014 severance pay from the employer and sick pay from health insurance.<\/p>\n For detailed calculations related to sick leave and sick pay, see the szamologep.hu sick pay calculator<\/strong>about.<\/p>\n A severance pay<\/strong> does not need to be claimed separately, and no separate application is required. If the eligibility conditions are met, the employer is obliged<\/strong> to pay it upon termination of employment, together with the salary. The payment is due on the day of termination of employment.<\/p>\n Practical notes:<\/strong> In the case of mutual agreement, the law does not require severance pay, but the parties are free to agree on it. If the employer offers a mutual agreement, be sure to record the terms in writing, including any severance amount.<\/p>\n No. Statutory severance pay is not due when the employment relationship ends due to old-age retirement. This should be taken into account when timing your retirement.<\/p>\n All time continuously spent with the given employer counts toward the employment period. If you worked there without interruption for 10 years, you fall into the 10\u201315 year bracket and are entitled to 3 months' severance pay. Time spent with a legal predecessor also counts, for example in the case of a company transformation or acquisition.<\/p>\n The employee may turn to the court. Severance pay is a labor law claim that can be enforced in the labor court. The limitation period is 3 years, but it is advisable to take the necessary steps as soon as possible.<\/p>\n In the case of a fixed-term contract, no severance pay is due upon the expiry of the contract. However, if the employer terminates the fixed-term contract prematurely, severance pay may be due in certain cases.<\/p>\n No. The severance pay amount<\/strong> is based on the actual absence fee, which is determined based on your part-time salary. The calculation formula and the number of months due based on the length of employment are the same.<\/p>\n Yes, but they are not the same concept. The employer may exempt the employee from work during the notice period, and must still pay the absence fee for this period. This amount is not<\/strong> is the same as severance pay \u2014 you may be entitled to both benefits if the conditions are met.<\/p>\n A severance pay rules for 2026<\/strong> have not fundamentally changed compared to previous years, but it is worth being aware of the exact conditions, as the amount can even be several million forints.<\/p>\n The most important points in brief:<\/strong><\/p>\nWhen Is Severance Pay Due? \u2014 Eligibility Conditions in 2026<\/h2>\n
In the case of employer termination<\/h3>\n
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When is severance pay NOT due?<\/h3>\n
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Amount of Severance Pay in 2026 \u2014 How Much Do You Get Based on Length of Employment?<\/h2>\n
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\n \nLength of employment<\/th>\n Amount of severance pay (monthly absence fee)<\/th>\n<\/tr>\n<\/thead>\n \n 3\u20135 years<\/td>\n 1 month<\/td>\n<\/tr>\n \n 5\u201310 years<\/td>\n 2 months<\/td>\n<\/tr>\n \n 10\u201315 years<\/td>\n 3 months<\/td>\n<\/tr>\n \n 15\u201320 years<\/td>\n 4 months<\/td>\n<\/tr>\n \n 20\u201325 years<\/td>\n 5 months<\/td>\n<\/tr>\n \n Over 25 years<\/td>\n 6 months<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n What does absence pay mean?<\/h3>\n
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How can severance pay be calculated?<\/h2>\n
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Example calculation<\/h3>\n
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Taxation of severance pay in 2026<\/h2>\n
Personal income tax (PIT)<\/h3>\n
Social security contributions<\/h3>\n
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Concrete example: From gross to net<\/h3>\n
\n\u2013 Monthly gross absence pay: HUF 500,000
\n\u2013 Length of employment: 14 years (3 months of severance pay)
\n\u2013 Gross severance pay: HUF 1,500,000<\/p>\n
\n\u2013 PIT (15%): HUF 225,000
\n\u2013 Social security contribution (18.5%): HUF 277,500
\n\u2013 Net severance pay (estimated): HUF 997,500<\/strong><\/p>\n\n
Calculation examples \u2014 specific cases<\/h2>\n
Example 1: Short employment (4 years)<\/h3>\n
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Example 2: Medium-length employment (8 years)<\/h3>\n
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Example 3: Long employment (22 years)<\/h3>\n
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Severance pay or sick pay \u2014 what's the difference?<\/h2>\n
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\n \nBenefit<\/th>\n When is it due?<\/th>\n Who pays it?<\/th>\n Duration<\/th>\n<\/tr>\n<\/thead>\n \n Severance pay<\/strong><\/td>\n Upon termination of employment<\/td>\n Employer<\/td>\n Lump sum<\/td>\n<\/tr>\n \n Sick leave<\/strong><\/td>\n In case of illness (first 15 working days)<\/td>\n Employer<\/td>\n 15 working days per year<\/td>\n<\/tr>\n \n Sick pay<\/strong><\/td>\n After sick leave expires<\/td>\n Health insurance fund<\/td>\n Indefinite period<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n How to claim severance pay?<\/h2>\n
\n\u2013 Severance pay must be paid on the day of termination of employment
\n\u2013 The employer pays it in a lump sum together with the salary
\n\u2013 If the employer does not pay it, the claim can be enforced before the labor court
\n\u2013 The limitation period for the claim is 3 years<\/p>\nFAQ \u2014 Frequently asked questions about severance pay<\/h2>\n
Is severance pay due in the case of mutual agreement?<\/h3>\n
Is severance pay due upon retirement?<\/h3>\n
How is the length of employment calculated?<\/h3>\n
What happens if the employer does not pay the severance pay?<\/h3>\n
Is severance pay required when a fixed-term contract expires?<\/h3>\n
Does part-time work affect the amount of severance pay?<\/h3>\n
Can severance pay be combined with the notice period?<\/h3>\n
Summary \u2014 what is worth remembering?<\/h2>\n
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