Company registration in Hungary
The landlocked Central European country is a popular destination for business owners looking to relocate or expand their companies. With a population of around 10 million people, the export-oriented economy of Hungary is the perfect choice for business activities that rely on trading their goods around the world.
A member of the EU, Hungary offers various direct investment opportunities in the automotive and agriculture industry for large companies to benefit from. Whether you start a new business venture or open branches in the country, you can take advantage of the thriving electronics and services sectors.
Hungary’s friendly investment policies and favorable tax system welcome foreign investors with open arms. With the low corporate tax set between 10% and 19%, this country truly has more to offer than just the natural beauty of the Danube River.
CompyCo helps you leverage the amazing investment opportunities that await you in Hungary. By working with us and our agents, your foreign company can gain instant access to Hungary’s highly-trained, well-educated workforce at affordable rates and hit the ground running with profit-generating ventures starting with company registration in Hungary.
Forms Of Companies In Hungary
- KFT “korlátolt felelősségű társaság” —limited liability company
- RT “részvénytársaság” —joint stock company
- BT “betéti társaság”—limited partnership
- FT “külföldi vállalkozás magyarországi fióktelepe” —branches
- KI “kereskedelmi képviselet”—representative offices
What is the difference between KFT and RT companies in Hungary?
The 2 most common types of Hungarian companies are the Kft and RT companies. The first one refers to limited liability companies, while the last one corresponds to either public (RT) or private joint-stock companies (Zrt). Some of the main differences between these two popular company types are explained below.
Limited liability companies (Kft) are typical limited liability companies with a minimum share capital of 3 000 000 HUF.
A Hungarian private joint-stock company (ZRT) is not listed publicly while RT is. Also, ZRT’s share capital is 5 000 000 HUF while RT’s company share capital is 20 000 000 HUF. Both are liable for the fulfillment of the company’s obligations with all its assets.
ZRT type of company can have one or more founding members and must be overseen by a board of directors.
The main difference between Hungarian private (ZRT) and public (RT) joint stock companies is the value of the mandatory deposit of shares. With a higher requirement for RT companies, the demand is for 20 million HUF. Every public joint stock company must have a management and supervisory board overseeing its activities.
Contact us today and discuss the best option for Company registration in Hungary in your specific case.
Fundamentals Of A Limited Liability Company
Corporate Tax in Hungary
VAT in Hungary
Fundamentals of limited liability companies in the Hungary
|Limited liability company||KFT|
|Minimum Share capital|
min 3 000 000 HUF
|Registered office required||Yes|
|Physical office required||No|
|Min. number of Shareholders||1|
|Min. number of Directors||1|
|Local Director required||No|
|Bank signatory must travel||In most cases yes|
|Timescale for company formation||2 weeks|
|Timescale for bank account opening||7 days|
|Timescale for obtaining VAT number||7 days|
|Statutory audit requirements||No|
|Shelf companies available||Yes|
What's involved in company registration process in Hungary?
Establishing a business outside your jurisdiction can be daunting, but CompyCo is dedicated to making the process easier for you.
If you are setting up a company in Hungary, you should fulfill these three key requirements:
- Have a legal address in the country
- Hire an accountant, preferably one that’s competent in English
- File for your company’s registration with the Hungarian Trade Registry
When setting up a business in Hungary, it’s mandatory for companies to acquire a social security number using an online form. In some cases, a VAT number might business be required as well.
After the company registration in Hungary has been finalized, CompyCo will register it with the local tax office, The central tax office, the Chamber of Commerce, Statistical office (KSH).
Company registration fees in Hungary will be determined by the: form of the company, number of shareholders, choice of banking, residency of shareholders and directors, and business activity. If you wish to find out the exact process, requirements, and fees for your specific case, complete this simple online form and we’ll send you an offer within 24 h.
Company formation in Hungary will cost 2200 EUR ex VAT unless there is complicated structure. This includes all fees inclusive of Registered office address for 1 year.
Many foreign investors find it easier to look for other, simpler alternatives to setting up a company and starting their business activities in Hungary. Purchasing a pre-incorporated self-company is one such viable alternative. What makes this such a popular choice amongst foreign business owners is that these companies are relatively lower-cost options in Hungary compared to other countries in the Eurozone.
Doing business in Hungary
Company registration process in Hungary is a fairly simple process if you have the right, experienced professionals guiding you along the way.
After that step, you will need support along the way. Weather it’s a contract supply or contacts in certain industry, we make sure to use all our resources to help you stay on top of your game and we make sure you save time and money.
CompyCo provides tailor-made solutions that are personalized to your business’s unique needs. We offer consultations with our experts, help you with understanding of the country. We provide additional services along the way, to make not only the company registration process in Hungary hassle-free, but also in your further business needs.
Our experts make the registration and licensing process easier with our concierge-style services. We’ve developed strong relationships with professionals all over the world who serve as points of contact when setting up your Hungarian company.
Bank Account Opening
By law, all Hungarian companies are required to open a bank account within 8 days of their company’s incorporation. Since this is a crucial and time-sensitive process, it’s important to work with experts who’ve been doing this for years!
Work with CompyCo and leverage the insight our extensive network of contacts in financial institutions have to offer. While we can act as a liaison between you and the bank so you can avoid traveling for just an interview, some banks don’t allow you to open a Hungarian bank account remotely. In these cases, your Power of Authority cannot complete this part of the registration for you. An in-person interview is necessary for the process to continue smoothly.
Not only does our team of experts help you with the documentation and processes of Hungarian financial institutions, but we also help you find a suitable banking service for your needs. Depending on your country of origin, intended business activities, and existing bank accounts in other countries, we’ll guide you to the most viable option.
Need more information about opening a bank account? Head over here.
Accounting & Taxation
Here are a few accounting and taxation obligations to take into consideration:
- The tax year is the calendar year in Hungary.
- Taxation in Hungary has progressive rates. Many double tax treaties are in place so that a company doesn’t need to pay taxes in several EU countries. Hungary’s corporate income tax is 10% on all income up to 500 million HUF and 19% on income greater than 500 million HUF.
Hungary has a standard VAT of 27%, but lower rates of 18% and 5% are applicable depending on the type of goods and services sold by your company. Hungarian companies are issued VAT numbers with the format of the country code HU followed by a 9-digit number which ends with a letter.
How can you employ staff in Hungary?
Hiring the right people to your new business venture is essential to ensuring business success, especially if you’re not always present in the country and they’re familiar with businesses in the jurisdiction.
Hungary has a large, expertly-skilled, and highly-educated workforce that you can employ as a foreign business owner.
CompyCo takes care of all your employee registrations, writes employment agreements, PEO or direct employing, recruiting, payroll, and other services you might need in a foreign country.
We take care of all aspects of employment so you can solely focus on your business activity. If you want to gain a deeper insight into the employment requirements for foreign business owners, we can set up an account with our unique software to help you understand your HR and payroll obligations. Every country operates according to its own unique set of regulations and our extensive experience makes us the perfect partner to outsource your HR functions.
CompyCo aims to give you complete control of your functions as an employer, while making time-consuming processes easier for you!
Have any questions? Take a look at our HR services page for more information about our International HR services!
If you are looking to incorporate in a EU country with stable financial system, but you are not quite willing to go with Germany and its costs, check out how can CompyCo support your business in Slovenia.