Setting up a company in Hungary

Hungary is a Central European country very open to foreign investment. With a population of almost 10 million inhabitants and an area of ​​around 90 thousand square kilometers, its currency is the Hungarian Forint (HUF), of considerably less value than the Euro (1 EUR = 349.68 HUF).

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Setting up a company in Hungary takes only a few days and its registration in the intra-community VAT register is carried out immediately. In fact, Hungary is one of the few countries in the European Union where this process remains automatic. This, together with a corporate tax of only 9%, makes Hungary an ideal destination for companies, investors and non-EU citizens who want to establish a base of operations in Europe in a comfortable and economic way.

There is the possibility of creating a company with 100% foreign capital in Hungary, and the partners can be both natural and legal persons.

Why Hungary?

• Quick and easy business creation: your company will be up and running in 4-5 business days
• Low corporation tax: being only 9% it is one of the lowest in Europe.
• Tax identification number for immediate intra-community VAT purposes: no waiting or additional requirements
• Low start-up capital that no deposit is required
• Profitability of the establishment and maintenance of the company
• Central location in the EU with good infrastructure
• Ease of obtaining visas and residence permits for citizens of all nationalities

Procedures for the Constitution of a Company

In order to set up a Limited Liability setting up a company in Hungary, you must apply to be registered with the Hungarian company court, and the necessary representation through a professional, a lawyer.

At that time of application for registration of the company, it is required to have contributed at least half of the minimum share capital, which is 3,000,000 HUF, in cash or in kind. The other half must be contributed one year later. Definitively the social capital will not suppose our ruin.

The administrator (s) can be a foreigner, and without any permission if he is a national of an EU member state. The administrator must make a series of declarations: acceptance of the position, that there is no conflict of interest, declaration that monetary contributions are available to the company and contribution from his firm.

Other Documentation to Provide:

• Statutes
• Certification of prior payment of fees
• List of partners.

The response time from when the inscription in the Mercantile Registry is requested is a maximum of 15 days.Once the Company is established, the administrator, or person representing him, must open a bank account.

Taxation in Hungary

The General Corporation Tax is 19%, but there are bonuses, and for SMEs it can be reduced to 10%.

Repatriation of Profits

This Directive allows the repatriation of Parent-Subsidiary benefits between Member States free of taxes when you are thing to setting up a company in Hungary. 

Does Starting a Business in Hungary Allow you to Obtain a Visa and Residence Permit in Europe?

Yes! Anyone can have their company in Hungary, regardless of their nationality or residence, and run it from their country. Once the company is established with FERSORIA, the directors who wish to do so may apply for visas, including choosing to move to Hungary and obtain a residence permit in the European Union, for themselves and their families.

By obtaining residency in Hungary, you and your family will be able to freely move around the Schengen area and enjoy the many advantages of the country, such as the low cost of living, a favorable business environment and its location in Central Europe.

Can I Open a Subsidiary of Another Company in Hungary?

Yes, you can form a subsidiary of a Hungarian or foreign company. The procedure is similar. We will need the documentation of the parent company, the details of its director and a power of attorney, with the Apostille of The Hague or sealed at the Hungarian embassy / consulate closest to your town.

How Long does the whole Process of Creating the Company Take in Hungary?

The company is registered in 1 or 2 business days from when we receive the signed documentation. VAT registration is automatic and you can start operating with your company from the first moment.

The opening of the bank account in Budapest is done in half an hour and the account is operational about 6 hours later.

In this article we have provided succinct and relevant information for the setting up a company in Hungary That is interested in establishing itself.