Hungary is located in the center of the European continent, mainly on the Middle Dunai Plain. The local government has an active policy of promoting the development of small and medium-sized businesses, company employees can obtain a residence permit in Hungary absolutely on legal grounds.
Advantages of company registration in Hungary:
- Hungarian government has signed double tax treaties with more than 70 countries;
- The absence of Hungary in the blacklist and the prestige as an EU member;
- The regime of an offshore company was canceled in Hungary, but a low-income tax rate of 9% introduced;
- Possibility to open a current bank account in Hungary (company + account in one country) relatively quickly even if the shareholders and directors of the company are non-residents;
- Regardless of the management place, the company becomes a tax resident of Hungary upon registration;
- Automatic obtaining of Hungarian and European VAT numbers;
- Fast obtaining of EORI (Economic Operator Identification and Registration number) number;
- There is no tax on dividends;
- There is no tax on the salary of a foreign director;
- There are no restrictions and additional taxes on payments from a Hungarian company to offshore companies.
Requirements for Hungarian companies:
- The obtaining of a VAT number is required condition for Hungarian companies;
- The minimum authorized capital is 3 million forints (about EUR 10,000). The authorized capital must be paid to the bank before the submission of the founding documents to the Companies House;
- Accounting of the company;
- Submission of Yearly Financial Statement;
- An audit for the Hungarian company is necessary if:
– The company’s annual turnover exceeds 300 million HUF (970 000 EUR) over the next two years;
– The number of employees exceeds 50 people per year.
- Bank account availability in Hungarian bank is mandatory for all Hungarian companies. Companies also have the right to open accounts in other states, but only if there is an account in Hungary;
- It is necessary to pay the statutory fund of the company;
- The company must have at least one director;
- It is mandatory to have a valid address in Hungary;
- The general meeting of participants must be held at least once a year.
Main tax rates in Hungary:
- In Hungary there is a municipal tax from 0% to 2% of the profit, depending on the place of business of the company and the province. The municipal tax must be paid annually.
- The VAT rate in Hungary is 27%.
- Hungarian tax law provides for benefits for certain types of intellectual property such as copyrights, patents, etc. Overall the intellectual property could be said is taxed from 4.5% to 9%.
Get an advice from our specialists about how to register a company in Hungary and how to open a bank account. Opening a company and bank account in Hungary takes from 2 weeks.