About HUNGARY
Hungary – is a state in Central Europe, famed by thermal springs and the Lake Balaton.
The independence of Hungary was repeatedly attacked by the neighboring countries (Austria, USSR), but, in the end, the country asserted its right on independence. Hungary is the EU member since 2004, and opening a business in this jurisdiction has become even more attractive.
The state with stable economic and political conditions, beautiful nature and European standards of living may be a great place for starting business or even your second home.
ADVANTAGES OF OPENING A COMPANY IN HUNGARY:
- the lowest profit tax rate in Europe- 9%;
- there is no tax on dividends (it doesn't matter whether they are received or paid);
- tax credits on income from certain types of intellectual property;
- Hungary is not an offshore zone and is not included in the EU "black list";
- the company is a tax resident of Hungary upon registration, regardless of the place of management;
- automatic receipt of the Hungarian and European VAT numbers.
LEGISLATION
Company activity in Hungary is regulated by:
- Commercial Companies Act 1997.
Types of companies
The legislator provides some corporate forms (partnerships, Limited Liability Company, public and private joint stock company etc), but the most preferable is the Limited Liability Company (Kft).
OPENING A COMPANY IN HUNGARY: REQUIREMENTS
LIMITED LIABILITY COMPANY (KFT):
- The minimum authorized capital – 3 000 000 HUF (approximately 10 000 EUR). The authorized capital must be paid to the bank even before the foundation documents are submitted to the Companies House, or the director issues a certificate of the transfer of this amount to the company's cash desk (in this case, the authorized capital becomes accountable).
- Shares - not issued. The authorized capital is divided into units.
- Director - at least 1, individual or legal person, no residency required.
- Members – at least 1, individual or legal person, no residency required. Director and shareholder may be the same person.
- Secretary – not required, but if all members of the company are non-residents, it is recommended to appoint a local manager.
- Publicly available information: information about members, directors and legal address.
- Company is obliged to keep and submit an annual financial report, to be audited (if the turnover during the previous 2 years is on average more than 300 000 000 HUF (approximately 1 000 000 EUR)).
- Registered office in Hungary is required.
TAXES
Income tax – 9%.
Tax on dividends from foreign companies – 15%.
VAT - 27%, but reduced rates are also applied to certain groups of goods.
Immediately after the company's registration is necessary to obtain the VAT (VAT) number and submit monthly reports.
Municipal tax - from 0% to 2% of profits.
Social security contributions for employees - 23%.
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AGREEMENTS ON AVOIDANCE OF DOUBLE TAXATION
A country concluded more than 60 agreements on avoidance of double taxation, including Ukraine.
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If you are planning to open a company in Hungary, please contact our lawyers for advice:
+38 (098) 737-88-88
We will help you buy an offshore company in Hungary or in any other jurisdiction on the most favorable terms. The cost of registering a company in Hungary is formed for each specific specific business, check the final price of the finished company with our lawyers depending on your individual needs.
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