Hungary

HUNGARY COMPANY FORMATION

Hungary is one of the most attractive countries for foreign investors in Central and Eastern Europe for establishing headquarters, holding, finance and/or trading companies, branches and distribution centers. Quick and easy company formation procedure in country with stable economy and low taxes. 

General Information about Hungary 
  • Location: Central Eastern Europe
  • Total area: 93,030 Km2
  • Population: 9,830,485
  • Official language: Hungarian
  • Official currency: Forint (HUF)
  • Time zone : CET (UTC+1), Summer DST (CEST- UTC+2)
What we offer
  • Register your Company in Hungary in 2 weeks.
  • We provide you with the most competitive price.
  • We maintain complete confidentiality.
  • A dedicated relationship manager will assist you throughout the process.
Incorporation Package Price

Our fees for incorporating and registration of a company in Hungary are $ 2699.

No Renewal cost is involved.

Incorporation Package includes
  • Professional services for preparation and submission of documents to registrar.
  • Payment of state duty for registration of a company.
  • Payment of government filing fees.
  • Acquisition of a registered office& registered agent for 1 year.
  • Unlimited free legal consultations for 1 year.
  • Accounting cost 100 EUR/month.
  • All Corporate Documents.
Basic Requirements for Company Formation
  • 1 Director.
  • 1 Shareholder.
  • Minimum Share Capital: EUR 1,800.
  • Filing incorporation request with the company registry.
  • Physical Office is required.
  • Payment of various Compliance fees.
Additional Services
      Nominee Shareholder (Non – resident): $ 350
      Nominee Shareholder (Resident): $ 2000
      Nominee Local Director: $ 2000
      Special Power of Attorney (Apostilled): $ 650
      Certificate of Good Standing in English (Apostilled): $ 250
      Tax Clearance Certificate (Apostilled): $ 200
      Set of Corporate documents (Apostilled): $ 500
Documents Required
  • Proof of identity (Current valid Passport, National ID card).
  • Proof of Residential Address of the chosen Shareholders and Directors.
  • Resolution to open a bank account, rent an office, appoint first director/shareholder, engage a Phone, Internet & Website service provider, hire a staff member/s.
  • Company registration form.
  • Any document that certifies your home or Hungarian address.
  • Any document that certifies your personal tax ID number.
  • Register of directors/shareholders.
  • M & AA, Certificate of Incorporation, Latest Annual returns and financial statements in case of a Corporate Shareholder.
Important Information about Hungary company

The Company Act of July 2006 determines six different corporate forms that may serve for investors as a basis to carry out business activity in Hungary. All of these forms can exclusively be established and operated by foreign owners and management: Unlimited Partnership (Kkt.), Limited Partnership (Bt.), Limited Liability Company (Kft.), Company Limited by Shares (Rt.) which may be privately founded (Zrt.) or publicly founded (Nyrt.), Association (egyesülés).  The Limited Liability Company is very popular with small or medium sized businesses in Europe. The Hungarian Kft. form is very close to the German and Austrian GmbH (Gesellschaft mit beschränkter Haftung) and similar to the British Ltd (private company limited by shares). With this type of company, it is possible to establish a single-member Kft. The Kft is the most common company form for wholly owned subsidiaries.  Companies registered under Hungarian law may undertake obligations and acquire rights in their own name (i.e. they have the right to acquire property, may conclude contracts, file lawsuits or be subject to actions brought against them). Even a single person can found a joint-stock company (JSC, or Rt. in Hungarian) or a limited liability company (LLC, or Kft. in Hungarian). 

Company Name

A Company name must necessarily end in “Kft.” or Korlátolt Felelősségű Társaság and must be approved by the Court of Registry. 

Corporate Taxation

Resident companies are taxed on worldwide income; non-resident companies pay tax on Hungarian-source income only. Taxpayers are treated as resident for tax purposes if they are created under Hungarian law or (from January 1st 2005) if they are managed or controlled in Hungary. Tax is charged at a flat rate of 16%, and the special rate of 4% applied to the profits of Hungarian offshore companies was abolished on December 31st 2005. As of January 1st 2006, for up to HUF 5m taxable income, a lower tax rate of 10% up to the first approx. US$ 1.8 million taxable income was introduced.  Corporation tax is imposed on a company’s accounting profits, adjusted by certain items. Normal business expenses generally are deductible in computing taxable income.  Capital gains are taxed as part of the accounting profit at 10%/19; however there is no tax due if the participation exemption applies. Capital gains realized by a shareholder resident in a non-treaty country on the sale of its shares in a Hungarian real estate company are taxable at a rate of 19%. Depending on the provisions of the specific applicable treaty, taxation may apply to a resident of a treaty country as well.  No withholding tax is levied on dividends paid to a nonresident legal entity. Dividends paid to a nonresident individual may be subject to withholding tax at 15%, unless the rate is reduced under an applicable tax treaty.  There is no withholding tax on interest paid to a legal entity. Interest paid to an individual is subject to withholding tax at 15%, unless the rate is reduced under an applicable tax treaty.  There is no withholding tax on royalties paid to a legal entity. Royalties paid to an individual are subject to personal income tax at 15%, unless the rate is reduced under an applicable tax treaty.  The standard VAT rate is 27%, with reduced rates of 18% and 5%. VAT is levied on the domestic supply of goods and services and on imports. 

Financial Statements and Audit Hungary companies are obliged to prepare a report based on the bookkeeping records maintained in accordance with the law, representing the company s operations, assets and financial position.
  A statutory auditor is required to be appointed: 
      if the registered capital of a Kft. exceeds 50 million HUF, or if there is only one registered owner; 
      if the total net revenue of the company exceeds 50 million HUF in two years average; 
      as per law requirements (insurance companies, banks and etc.).
In order to be appointed as an auditor, the individual person or audit company must be registered in the list of registered accountants. The auditor must be named in the Articles of Association and can be appointed for a period not exceeding five years.

For any queries/ additional services please send us an email or reach us on Skype at info@offshore-banking.net.  

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