Saute chopped up onion in the oil. Pull it off from the heat.
Add the paprika (both kind) to the sautéed onion. (If you leave it on the heat while you do this, the paprika will burn) Mix it until the paprika dissolved.
Add chicken. Mix it together with the onion-paprika paste, until all the pieces are covered with the paste. Turn your heat up high, brown the meat, while you constantly mixing it. While you doing it, be careful not to burn the paprika paste!
When all pieces look white all around, turn down the heat to low, add salt, cover and cook. During your low heat cooking the juices of the chicken will come out, so your dish will cook in its own juices. If you pick dry meat (breast) you have to add some liquid(chicken broth).
After 10 minutes add pepper piece to the food. Cook for another 10-15 minutes. Check for tenderness.
Before serving, remove skin. Serve with pasta, or baked potato. Top the dish with a tablespoon of sour cream.
Hungarians serve it with some pickled items on the side, such as cucumber, or pickled pepper.