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Are you thinking about opening a company abroad? Are you looking for a stable European jurisdiction with low taxes and the ability to obtain a residence permit in the EU? We offer services for registering a company in Hungary.
After joining the European Union, Hungary ceased to be an offshore company, moving to the status of an onshore with the most favorable tax climate in Europe. Since 2017, the country's income tax rate is 9%, which makes it increasingly popular for foreign investors. Opening a commercial organization in Hungary is a great option for those who want to take their business internationally or emigrate.
Lawyers of the company "RegService" will help prepare registration documents, certify them with a notary, go through the apostilization procedure. We provide comprehensive legal support, a legal company in Kiev - we provide services for corporate support, obtaining licenses, registering a trademark.
Pros and cons of starting a company in Hungary
The advantages of jurisdiction include:
- the lowest corporate tax rate in Europe - 9%;
- the state is not included in the "black" and "gray" lists of international anti-offshore organizations and in the Ukrainian list of offshore zones;
- existence of an agreement with Ukraine on the avoidance of double taxation;
- zero tax on dividends;
- the ability to quickly obtain a European VAT number, the Hungarian VAT number is assigned automatically;
- fast, from 1 day, opening an account in a Hungarian bank;
- fast procedure for obtaining a residence permit;
- lack of exchange controls.
The registration of so-called "offshore" companies in Hungary also has disadvantages:
- high VAT - 27%;
- the need to pay municipal tax (0–2%, in case of non-payment, the income tax rate rises to 10%);
- open register of participants, directors, beneficiaries of companies;
- bookkeeping and submission of financial statements are mandatory;
- large and medium-sized business entities are audited;
- The Hungarian language is not widely spoken, in this regard, difficulties arise in the preparation of documentation.
Organizational and legal forms of Hungarian firms
You can open a business in Hungary as:
- KFT - analogue of LLC;
- RT - joint stock company;
- BT - limited liability partnerships;
- KTT - unlimited partnerships.
The most popular form in terms of management and costs of company registration and support is KFT. The minimum authorized capital of such a company is 3 million Hungarian forints (9,300 euros), at the time of the establishment of the organization 50% must be paid, the rest of the amount - within 2 years. The minimum number of directors and shareholders is 1, they can be a non-resident.
Taxation and audit
Registration of a company in Hungary is a common phenomenon among foreign investors, since, in particular, LLCs do not pay taxes on dividends received from firms from the EU, as well as on dividends to foreign parent organizations. For this reason, KFT is often used in holding structures. Such companies are also involved in export-import operations, provided that they are not classified as controlled transactions.
Tax rates for LLCs are:
- 9% - corporate tax;
- 27% - VAT;
- 0-2% - city tax (maximum - in Budapest);
- tax on profits from intellectual property - 4.5-9% (not paid if their purchase was declared within 30 days and the business entity owned them for at least a year).
If you decide to register a company in Hungary, you will need to pay 400,000 forints (1,350 euros) registration fee + annual government fee of 5,000 forints. A bank account must be opened within 15 days from the date of creation of the legal entity.
With an average annual turnover of HUF 300 million and the number of employees over 50 people, the company must undergo an audit.
How to open a company in Hungary?
The registration procedure includes the following stages:
- Passing the Due Diligence procedure, identifying the identity of the beneficiary;
- Choice of name (at least 2 options);
- Payment for the services of a lawyer + depositing money to cover the costs of notarization of documents, apostilization;
- Preparation of the necessary documents, their notarial and consular certification.
Hungary company: registration period - 10-17 days. If you wish, you can buy a ready-made company.
If you have never been involved in international business and for the first time decided to open a company in Hungary, before taking any actions on your own, we recommend that you consult with a RegService specialist. An experienced lawyer will be able to find out your needs and advise on the best company to register in your case. To get a detailed consultation, leave a request on the website, wait for the manager's call. Further, we will advise you by phone or in person at our office in Kiev.
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