I
Hungary

Hungary

Company Formation in Hungary

Hungary

Formation Time
1–2 business days
Min. Capital
HUF 3,000,000 (~€7,600, no upfront deposit required)
Corporate Tax
9% flat (lowest rate in EU)
Foreign Ownership
100%

Overview

Hungary boasts the lowest headline corporate tax rate in the entire European Union at just 9% flat. A member of both the EU and the Schengen Area, Hungary provides instant digital incorporation — with electronic filings registered in as little as 1 to 2 business days. Although the standard registered capital for a Kft (Limited Liability Company) is HUF 3,000,000 (~€7,600), the capital does not need to be deposited into a bank account prior to registration and can be funded out of future company profits over up to two years. Hungary is especially renowned as an international holding hub: dividends received from foreign subsidiaries are 100% tax-exempt, capital gains on registered shares are 100% tax-free, and Hungary imposes 0% withholding tax on dividends, interest, and royalties paid to foreign corporate entities.

9% lowest CIT in EU
1-day electronic formation
0% withholding tax
No upfront capital deposit

Why Choose Hungary

1

9% flat corporate tax rate — lowest statutory CIT rate in the European Union

2

Fastest company formation in the EU — registered in 1–2 business days

3

No upfront capital deposit required — HUF 3M capital can be paid from future profits

4

100% tax exemption on incoming dividends and qualifying capital gains

5

0% withholding tax on dividends, interest, and royalties paid to foreign companies

6

Extensive global tax treaty network with 84+ bilateral treaties

7

Central European strategic logistics hub bordering 7 nations

8

New Hungarian Golden Visa (Guest Investor Program) launched in 2024

Business Entity Types

EntityOwnershipDirectorsCapitalTaxBest For
Kft (Korlátolt Felelősségű Társaság)100%1 managing directorHUF 3,000,000 (can be paid post-incorporation)9% flat corporate taxTrading, holding, software, consulting, e-commerce
Zrt (Zártkörűen Működő Részvénytársaság)100%1 (Director or Board)HUF 5,000,000 (~€12,700)9% flat corporate taxLarger investments, private equity, institutional ventures

Step-by-Step Formation Process

1

Drafting & Attorney Signature

1 day

Hungarian attorney drafts Deed of Foundation and verifies signatures via video call.

2

Court of Registration Filing

1–2 days

Electronic filing with the Hungarian Court of Registration (Cégbíróság).

3

Tax Number & VAT Issuance

Same day

Automatic issuance of national and EU VAT numbers upon registration.

4

Bank Account Opening

1–3 weeks

Open corporate account with a Hungarian or European bank.

Costs & Fees

Government / License FeeEUR 200+
Our Service FeeUSD 2,500 – 4,000
Annual RenewalUSD 1,500+

Fees are indicative and may vary based on business activity, entity type, and additional approvals required. Contact us for a precise custom quote.

Get Custom Quote

Banking

Hungarian banks (OTP Bank, K&H, Erste Bank) offer multi-currency accounts in HUF, EUR, and USD. Modern digital fintechs like Wise and Revolut are widely utilized.

Account Opening Time
1–3 weeks
Multi-Currency
Yes — multiple currencies supported

Recommended Banks

OTP BankErste Bank HungaryK&H BankWise BusinessRevolut Business

Tax Overview

Corporate Tax
9% flat corporate tax
Personal Income Tax
15% flat personal income tax
VAT / Sales Tax
27% (reduced 18% and 5% for certain goods/services; 0% EU B2B)
Capital Gains Tax
0% for participation exemption on reported shareholdings
Withholding Tax
0% on dividends, interest, and royalties paid to foreign corporate owners
Double Tax Treaties
84 countries

Local Business Tax (IPA) of up to 2% applies at the municipal level based on gross profit margin, with 0% IPA available in select Hungarian municipalities.

Visa & Residency

Guest Investor Program (Golden Visa)

10 years (renewable for 10 years)

€250,000 real estate fund investment or €500,000 residential property

Business Manager Residency

1–2 years, renewable

For directors actively running their Hungarian Kft

White Card (Digital Nomad Visa)

1 year, renewable for 1 year

For remote workers earning €3,000+/month

Family visa: AvailableProcessing: 1–2 months

Frequently Asked Questions

Why is Hungary known for having the lowest corporate tax rate in the EU?
Hungary levies a flat corporate income tax (CIT) of just 9%, which is the lowest statutory rate across all 27 European Union member states. When combined with comprehensive participation exemption rules and 0% withholding tax on foreign outbound corporate dividends, Hungary provides one of Europe's most tax-efficient operational and holding structures.
Do I need to deposit the HUF 3,000,000 share capital in a bank before registration?
No. Under the Hungarian Civil Code, the standard HUF 3,000,000 (~€7,600) registered share capital for a Kft does not need to be deposited into a bank account prior to company registration. Founders can declare the capital upon incorporation and fund it out of company earnings or contributions over a period of up to two years.
How fast is company registration in Hungary?
Hungary provides the fastest electronic corporate registration in the European Union. Utilizing standard statutory Articles of Association and an electronic signature verified by a licensed Hungarian attorney via secure video identification, incorporation is typically completed in just 1 to 2 business days at the Court of Registration.
What is the Hungarian Local Business Tax (IPA)?
In addition to the 9% national corporate income tax, Hungarian municipalities levy a Local Business Tax (Iparűzési Adó - IPA) of up to 2% on net sales revenue (less cost of goods sold and material costs). Notably, certain municipalities in Hungary levy a 0% IPA rate, which companies can utilize by locating their registered seat in those districts.
What are the withholding tax rules on dividends and interest paid to foreign entities?
Hungary does not levy any withholding tax on dividends, interest, or royalties paid to foreign corporate shareholders, regardless of where the parent company is resident and irrespective of whether a double tax treaty exists. This makes Hungary an extraordinary EU holding company platform.
Can non-EU entrepreneurs obtain residency in Hungary through company formation?
Yes. Founders can qualify for the Hungarian Business Manager Residency (allowing residency for up to 2 years, renewable) by demonstrating active management and economic viability of their Kft. Alternatively, Hungary's Guest Investor Program (Golden Visa) offers a 10-year renewable residency through qualifying investments.