I This document constitutes the base prospectus of ... - Volksbank AG

the country for more than 183 days (including the date of arrival and the date of departure) during a calendar
year.
Hungarian resident individuals are subject to individual income tax on their worldwide income.
a) Tax on Interest Income
Under the effective Hungarian tax law, interest is subject to income tax at a rate of 20 percent. According to
the personal income tax law, interest inter alia shall mean
the interest or yield on debt securities and collective investment securities if the legislation defined it as
interest;
the capital gain on these publicly offered / traded discount securities and collective investment securities
received by the individual at maturity as the difference between the issue value and the nominal value at redemption
/ transfer (except in case of redemption or transfer of collective investment securities via Hungarian,
EEA or OECD stock exchange);
Tax on interest income is to be withheld by the payer. Tax payment and tax return is to be satisfied monthly,
in an electronic form.
b) Capital Gains of Stock Exchange Transactions
Under the effective Hungarian tax law, income realised within transactions performed in a stock exchange (on
a stock exchange established according to the Hungarian Act on capita markets, or in any EEA or OECD
member state) is subject to income tax at a rate of 20 percent.
Income from stock exchange transactions are to be determined for the calendar year by the individual, where
(financially settled) gains on certain transactions may be offset by losses on other ones. Costs of investment
services attributable to the given transactions are deductible. Hungarian personal income taxation follows a
cash-flow approach for the determination of gains and losses.
The payer is not required to withhold the amount of tax payable the payer of the income shall provide data on
the gains / losses held by the individual by the end of January following the calendar year. Income from stock
exchange transactions is to be self assessed by the individual. Tax return and tax payment in relation to stock
exchange incomes is due till the 20 th of May following the calendar year (within and till the deadline of the
general yearly tax return).
c) Capital Gains (Non-Stock Exchange)
In the case of capital gains earned at their transfer on securities (qualifying as securities based on the Hungarian
law or by law of the state of its issuer which seems to be the case in all the listed Securities), 25 percent
personal income tax and 14 percent health care contribution (capped at HUF 450,000, approx. EUR 1,650 per
annum) should be paid on the income minus the purchasing costs, (excluding the yield determined as interest
income or as income from stock exchange transactions or as part of other specified income category).
d) Underlying Payments / Yields During Holding the Instrument (Non-Stock Exchange)
Index linked notes, variable coupon notes, warrants, etc. or more generally any securities whose holders are
not exposed to credit risk of the relevant issuer may be regarded as taxable income in Hungary as part of the
consolidated taxable base of the taxpayer (being subject to tax at graduated 36 percent personal income tax
and 4 percent solidarity surtax at the highest, plus 11 percent health care contribution) unless the relevant
income is earned on a stock exchange. The above tax implications apply to underlying payments or yields that
cannot be regarded as interest income and that are not earned through a stock exchange.
Should further assessment on structured products be required this can be supplied once detailed background
information about these securities is made available.
The Hungarian personal income tax legislation also includes unilateral credit method for avoiding double
taxation of income taxable abroad. Moreover, under an applicable double tax treaty the exemption method
could also be available.
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