The era of classic wealth investigations affecting large numbers of individuals came to an end following the 2016 legislative changes, but the spring 2026 change of government brought these proceedings back into the spotlight. The new government’s agenda — explicitly announced by the Prime Minister — placed the accountability of corruption-derived assets, the former political elite, and individuals who had access to state resources at the forefront. Estimation as a method of proof remains an integral part of NTCA audits. In this article, we review the rules governing estimation and the legal and practical conditions for wealth investigations.

What Is a Wealth Investigation?

A wealth investigation is essentially an estimation procedure linked to personal income tax, and the primary instrument for uncovering unlawful enrichment and illegal income. If the tax authority finds that the increase in wealth of the person under investigation — whether a former government minister, a public figure, or a private individual — or the expenditures on a lavish lifestyle are disproportionate to the combined total of their tax-exempt, declared, and non-declaration-liable income, then the NTCA determines the tax base by way of estimation.

This means the tax auditor estimates how much legitimate income the taxpayer’s lifestyle, expenditure, and accumulated assets — for example, luxury real estate or shareholdings in private capital funds — would require. The authority must estimate the amount of income that would have been necessary to finance the increase in wealth.

This estimated income becomes the basis for the tax assessment, and it is against this figure that personal income tax and contribution arrears are determined — together with the punitive 200% tax penalty applicable to the established tax difference, which can represent a devastating financial blow in cases of concealed assets suspected of corruption.

The Process of Estimation

During estimation, the tax authority must substantiate the tax base: it must take into account and evaluate collectively all relevant available facts, circumstances, evidence, and statements pertaining to the determination of the tax base.

However, the taxpayer may rebut the deviation from the tax base calculated via estimation with credible evidence. The burden of proof lies with the taxpayer: even in accountability proceedings, it is the person under investigation — for example, the former politician — who must prove the legitimate source of the income. The NTCA is not required to prove the absence of income step by step.

📚 Related article: For a detailed overview of NTCA tax audits and the risk of criminal proceedings: NTCA Compliance Review and Tax Audit Process →

The Rules on Limitation Periods

An important aspect of tax law is the question of limitation. The standard tax law limitation period is currently 5 years. If the taxpayer states that the source of the wealth increase was acquired beyond this limitation period, only the following may serve as evidence of the source and the date:

  • official public register
  • final court or authority decision
  • public deed
  • payment account or securities account statement

The new government specifically announced retrospective wealth investigations going back twenty years against former government members and their close relatives. To carry out investigations into decades-old state corruption cases of this kind, a legislative amendment to the procedural and limitation rules — on a transitional basis — may also be initiated in the National Assembly.

Example: The Documentary Evidence Rule in Practice

To illustrate the above rule with an example typical of assets linked to public funds: if, during a wealth investigation, a public figure or their relative states that they received a HUF 500,000,000 loan from a business partner back in the 2010s, a simple private document between individuals — i.e. an ordinary contract — is no longer accepted as supporting evidence. Only a deed drawn up by a notary public or an official bank statement can be sufficient.

Within the limitation period, however, the auditors have an extensive and broader set of tools at their disposal (e.g. witness examinations, audits of related entities within corporate networks and offshore-backed companies).

When Can a Wealth Investigation Be Initiated?

The most important constraint on wealth investigations is that under current law they may only be initiated where there is a suspicion of offences defined in specific chapters of the Criminal Code on the part of the investigative authority. This is precisely what provides the legal basis for the accountability proceedings following the change of government, as overpriced public procurement contracts and suspicious enrichment may well give rise to suspicion of these very offences.

The criminal law categories underpinning the investigation:

  • offences against property (e.g. fraud, embezzlement, breach of fiduciary duty)
  • offences against the budget (e.g. budgetary fraud)
  • money laundering
  • offences against the order of economic activity (e.g. bankruptcy offences)
  • offences against the security of monetary and stamp circulation

📚 Related article: On the criminal law rules governing budgetary fraud and measures against legal persons: Budgetary Fraud – Criminal Law Measures →

A wealth investigation may be initiated when criminal proceedings are underway in relation to the offences listed above — in particular, the suspected embezzlement or breach of fiduciary duty of corruption money. The criminal proceedings must be directed against a specific suspect (proceedings against an unknown perpetrator are not sufficient), but it is not necessary that the suspect and the taxpayer subject to the wealth investigation be the same person.

In the current political and legal landscape, this practically means that if a former politician, decision-maker, or state company executive is placed under investigation, the NTCA may extend its audit to family members, front persons, and business associates acting on their behalf.

📚 Related article: On asset-related coercive measures, seizure, and confiscation applicable in criminal proceedings: Confiscation and Seizure in Criminal Proceedings →

Standard Personal Income Tax Audit vs. Wealth Investigation

It is worth noting that, irrespective of egregious corruption cases, the tax authority may conduct a personal income tax return audit in respect of any individual taxpayer — no criminal investigation for the above offences is required for this.

In a standard personal income tax return audit, the NTCA examines the taxpayer’s income, any concealed income, their tax returns, and official registers. In such cases, the audit will make a finding in respect of the specific concealed income not reflected in the return — that specific item will form the basis of the assessment.

However, if the taxpayer’s records and documentation for the period under review are incomplete or unsuitable for auditing — which is common in cases of funds transferred into opaque corporate structures — the tax authority may apply estimation and will notify the taxpayer accordingly.

The Essential Difference Between the Two Procedures

This tax law estimation, however, is not identical to the conduct of a full wealth investigation, in which the auditors examine whether the taxpayer’s declared income is proportionate to their private assets and any lavish lifestyle.

  • In the standard case: the NTCA determines the tax base for the specific period under review, but does not examine the full historical increase in wealth.
  • In a wealth investigation: the entire increase in wealth may be examined, but only in parallel with the aforementioned criminal proceedings (e.g. suspected budgetary fraud and money laundering).

Summary

Overall, it can be stated that every wealth investigation involves estimation by the tax authority, but not every estimation is connected to a wealth investigation. In the period following the 2026 change of government, it is virtually certain that the strictest form of tax audit — covering the full estate — will play a prominent role in uncovering unlawful enrichment derived from former state resources.

📞 Expert support: If you have been affected by an NTCA wealth investigation or tax authority estimation, contact us for an early consultation.

⚖️ Legal representation: Given the difficulty of the burden of proof in wealth investigations and tax audits, expert representation is especially important: Tax Audit Representation →

Published by: Dr. Árpád Molnár, attorney-at-law

This article has been prepared for informational purposes only and does not constitute an official legal opinion, legal advice, or tax advice applicable to any individual case by Molnár és Márk Law Association. Molnár és Márk Law Association excludes its legal liability for the use of the contents of this article in any individual case.