THE ART OF
BEING LOCAL
IN HUNGARY
Starting a Business in Hungary
Starting a business in Hungary gives international companies access to the EU single market under particularly attractive tax conditions, for example the lowest corporate income tax rate in the EU. InterGest Hungary supports foreign investors with local expertise and personal service from its Budapest office.
What you need to know about starting a business in Hungary
Most companies choose the Kft (korlátolt felelősségű társaság), the Hungarian equivalent of a German GmbH. Liability is limited, and the company can be 100% foreign-owned. The minimum share capital is HUF 3,000,000; the formation costs around €5,000 and takes two to four weeks in practice. The process involves several steps, from choosing the name and registered seat to registration in the Cégjegyzék (the Hungarian company register). You do not have to appear in person: the formation can be handled by video call.
Interested in other countries where InterGest operates? You will find more on our overview page starting a business abroad, including a comparison table of the most common legal forms and regional overviews, for example on starting a business in France, India, Mexico or China.
An overview of all InterGest services is on our services page.
Your contact for starting a business in Hungary
As Managing Director of InterGest Hungary, Nils Blunck guides foreign companies through company formation and market entry in Hungary. From the office in the House of the German Economy in Budapest, he is your main point of contact.
With his in-depth knowledge of Hungarian administrative, registry and banking practice, he combines local expertise with the reporting and quality standards that international parent companies expect. Together with his team he looks after accounting, tax, payroll and reporting and coordinates the work with lawyers, notaries and the tax authority NAV. Headquarters therefore has transparent, reliable information on its Hungarian subsidiary at all times.
Why a location in Hungary pays off
Hungary’s appeal fits into one sentence: full EU market access at 9% corporate income tax – the lowest regular rate in the Union. For most of our clients, that settles it. Six further points come on top, though not every one carries the same weight for every project:
- Tax burden: 9% corporate income tax, 15% personal income tax, no withholding tax on dividends paid to foreign companies. That is the core of the location advantage.
- Limited liability: In a Kft, shareholders are liable only up to their contribution; private and business assets stay separate.
- Single market: A Hungarian company trades freely across the entire EU.
- Location: Austria, the Czech Republic and Romania are on the doorstep, and Germany is within easy reach by road and rail. A tangible advantage for production and logistics; for a pure IT venture, more of a side note.
- Skilled staff: Well-trained, often multilingual people in industry, IT and administration – at wages well below German levels. Car manufacturers calculate production costs at just 30% of what they would pay in Germany.
- Grants: For investments in production, R&D or shared service centres, you can obtain grants of up to 50% – application- and region-dependent, not automatic.
One honest caveat remains: the road there is more bureaucratic than the tax figures suggest. Hungarian-language registry procedures, the bank’s KYC check and the requirement for a seat and an agent for service cost time when they are tackled too late. This is exactly where InterGest Hungary comes in.
Which legal form is right for starting a business in Hungary?
Several company types are available in Hungary – foreign investors almost always choose the Kft (korlátolt felelősségű társaság), the Hungarian equivalent of a limited liability company. It offers limited liability, can be wholly foreign-owned and is run by one or more managing directors (ügyvezető). The minimum share capital is HUF 3,000,000.
Hungarian law also provides other forms. The Zrt (private company limited by shares) and the Nyrt (public limited company) suit larger, capital-market structures, while the Bt (limited partnership) and the sole trader fit smaller ventures. Foreign individuals and companies can be founders and shareholders without restriction.
Good to know: anyone not resident in Hungary usually needs a Hungarian agent for service (kézbesítési megbízott) and a registered seat in the country.
| Legal form | Minimum capital | Typical use | Suitability for foreign investors |
|---|---|---|---|
| Kft (korlátolt felelősségű társaság) | HUF 3,000,000 | Subsidiary, mid-sized firms; equivalent to a GmbH | Very suitable, 100 % foreign ownership possible |
| Zrt (private company limited by shares) | HUF 5,000,000 | Larger structures, several investors | Possible, more effort |
| Nyrt (public limited company) | HUF 20,000,000 | Capital-market ventures | Only for special cases |
| Bt (limited partnership) | No fixed minimum | Smaller ventures with general and limited partners | Possible, one partner has unlimited liability |
Location and infrastructure in Hungary
When starting a business in Hungary, an early look at the location pays off: wage levels, industry clusters and incentive zones differ markedly between regions. These factors matter most:
- Policy environment: Government and municipalities welcome investment and generally act as problem-solvers rather than gatekeepers.
- Tax rates: The 9% corporate income tax rate is the lowest regular rate in the EU. Personal income tax is a flat 15%. Distributions to individuals are generally taxed at 15% as well, with further charges or treaty rules to consider depending on the case.
- Industry clusters: Administration, finance and IT in Budapest, automotive and engineering around Győr, Kecskemét and Debrecen, logistics along the corridors towards Vienna and the Balkans.
- Transport links: Motorways, rail and Budapest airport connect Hungary with the world and closely with the neighbouring markets of Central-Eastern Europe, towards Poland in the north and Austria and Germany in the west.
- Skilled staff: Multilingual engineers and administrative staff; availability varies by region and sector, at competitive salary levels.
- Grants: For investments in production, shared service centres or research and development, substantial grants of up to 50% of the investment amount are available.
InterGest Hungary has its head office in Budapest, in the House of the German Economy. From there the team serves clients across Hungary and advises broadly, from the choice of location to tax questions and grants.
How company formation in Hungary works
Company formation in Hungary is organised in six steps:
- Set the key parameters: you decide the legal form, company name, seat, business purpose (TEÁOR codes, the Hungarian activity classification), shareholder structure and management.
- Prepare the documents: founding documents, share capital, powers of attorney, proof of identity and, for legal entities, register extracts are assembled and, where needed, translated and certified.
- Draft the articles: a Hungarian lawyer drafts and countersigns the articles of association. At the same time, the proof of seat and the agent for service are arranged.
- Registration and tax filing: the application is filed electronically with the company court (Cégbíróság). Tax registration is handled by the tax and customs authority NAV via Cégkapu, the company’s electronic mailbox for all official communication.
- Open the bank account: during or after the formation, a business account is opened with a Hungarian bank and the share capital is paid in.
- Set up accounting and compliance: accounting, invoicing, internal powers of attorney and the first tax and reporting deadlines are put in place. InterGest can coordinate lawyers, notaries and translators and prepare the applications.
Once all documents are complete, registration usually takes two to four weeks. The simplified registration procedure itself often runs in a few days.
What does starting a business in Hungary cost and how long does it take?
As a guide, plan around €5,000, mainly for advice, legal fees, translations and certifications; with foreign shareholders and multilingual documentation it can be somewhat more. Registration usually takes two to four weeks.
| Item | Duration |
|---|---|
| Document preparation and translations | 1–2 weeks |
| Articles of association by a lawyer | A few days |
| Electronic registration (Cégbíróság) and tax registration (NAV) | A few days to 2 weeks |
| Bank account opening | 1–2 weeks |
| Advice and support | Throughout the project |
| Typical total | 2–4 weeks to registration |
Share capital: The minimum share capital of the Kft is HUF 3,000,000 and can be provided in cash or in kind; payment and deadlines are set out in the articles of association.
Ongoing taxes: At just 9%, Hungary has the lowest regular corporate income tax rate in the EU. In addition, a local business tax of up to 2% applies, calculated on its own base adjusted for certain items. The standard VAT rate is 27%, with reduced rates of 18% and 5% for selected goods and services. Dividends to foreign companies can generally be distributed without Hungarian withholding tax.
Individuals in Hungary are generally subject to a flat personal income tax of 15%. The same rate generally applies to dividends, though a capped social contribution tax may come on top.
Note: The actual tax burden depends, among other things, on the corporate structure, the shareholders’ residence, the double-taxation treaty and the relevant assessment base.
Which documents do I need for starting a business in Hungary?
The company court needs the right set of documents:
For the company:
- Articles of association
- Details of the company, seat, business purpose (TEÁOR codes) and share capital
- Proof of the Hungarian seat
- Specimen signatures of the managing directors
For shareholders and managing directors:
- Proof of identity of the shareholders and managing directors
- For legal entities: shareholder resolution and a recent register extract
- For persons not resident in Hungary: appointment of a Hungarian agent for service
- Where needed: translations and certifications of the foreign documents
After registration, the bank account, tax registrations and Cégkapu access have to be arranged. InterGest can coordinate gathering, certification and filing in the right order. You will find more guidance in our FAQs.
Which laws and authorities apply in Hungary?
Starting a business in Hungary follows a clearly regulated framework of company, registry and tax law. The key is to know who is responsible for what.
The foundation is the Hungarian Civil Code (Ptk.), which governs company types, formation, bodies and liability. Registration is filed electronically with the company court (Cégbíróság) and entered in the Cégjegyzék, the Hungarian company register. The tax side is handled by the tax and customs authority NAV, and communication with the authorities goes through Cégkapu.
These authorities and laws apply to every formation:
| Legal basis / authority | Function |
|---|---|
| Ptk. (Hungarian Civil Code) | Governs company types, formation, bodies and liability. |
| Cégbíróság (company court) | Keeps the Hungarian commercial register (Cégjegyzék) and enters the company. |
| NAV (tax and customs authority) | Issues the Hungarian tax number and levies corporate income tax and VAT. |
| Cégkapu | Electronic authority portal for communication with the offices. |
| Municipality | Levies the local business tax (iparűzési adó). |
| Céginformációs Szolgálat | Company Information Service, official company data and register extracts. |
How do you finance the Hungarian subsidiary?
Parent companies typically finance the Hungarian subsidiary from a mix of several sources:
- Equity from the home country: The standard route: the contribution goes into the Kft as share capital. A sufficient liquidity reserve for the first months of operating costs is also advisable.
- Shareholder loans: Loans from the parent company are common. The contract and market-rate interest should be documented.
- Local bank loans: Hungarian banks finance established business models but require collateral and a track record.
- Grants: Grant programmes can subsidise investments, especially in designated development regions. The investments usually have to be pre-financed.
Which financing structure fits depends on the sector, the capital requirement and the planned pace of growth. Equity and shareholder loans are often combined. InterGest Hungary reviews the capital structure as a whole and makes sure it does not unnecessarily complicate the later repatriation of profits and funding.
Documents incomplete or not certified
Outdated, incomplete or poorly translated documents from foreign shareholders or directors are the most common hold-up. The company court rejects the filing, and a new loop begins.
We check the documents early and arrange translations and certifications in the right order.
Bank account and KYC clarified too late
Sorting out the bank account, the KYC check (the identity and source-of-funds review banks run), beneficial owners and payment flows too late costs time. Without an active account the share capital cannot be paid in, and operations start late.
We prepare the account opening and the KYC documents in parallel with the formation.
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What InterGest in Hungary handles for you
Short answer: InterGest Hungary guides foreign companies from the choice of legal form and registration through accounting, payroll and tax to the reporting for headquarters. The Budapest team works in German, English and Hungarian.
Led by Nils Blunck, InterGest Hungary bridges the gap between Hungarian administrative, registry and banking practice and what an international parent company expects in reports and standards.
- Formation: Legal form, notary, translations, seat and agent for service, filing with the Cégbíróság and NAV – we prepare the documents and coordinate everyone involved.
- Advice: Location, legal form and route to market, worked out on your actual project, not in theory.
- Accounting: Our local team runs the double-entry books under Hungarian law, prepares the monthly and annual accounts and the reporting for headquarters.
- Tax: Corporate income tax, VAT and the local business tax, deadlines and filings – aligned with the accounting, from the tax number to the year-end close.
- Payroll and HR: Payroll under Hungarian law, social contributions and, on request, support with contracts and day-to-day staff matters.
- Controlling: Monthly consolidation and cross-border reporting, on request aligned with your group’s reporting standard.
- Payments and legal: Invoicing, payment monitoring, out-of-court debt collection and – on request – fiduciary administration and contract review.
One dedicated contact steers all of this, instead of sending you back and forth between lawyer, bank and accountant.
Ready for your market entry in Hungary?
When will you start?
How long does it take to set up a company in Hungary?
With all documents in place, registration usually takes two to four weeks; the electronic registration procedure is among the fastest in Europe.
The main hurdles are Hungarian-language procedures, bank KYC and the requirement for a Hungarian seat and agent for service.
InterGest Hungary clears those hurdles so that your formation stays on schedule.
Is Hungary a high tax country?
No. Corporate income tax in Hungary is 9%, the lowest rate in the EU.
In addition, a local business tax of up to 2% applies, calculated on its own base adjusted for certain items. VAT (áfa) is 27%, with reduced rates of 18% and 5% for selected goods and services.
Dividends to foreign companies can generally be distributed without Hungarian withholding tax. Individuals pay a flat personal income tax of 15%, which generally also applies to dividends, plus in some cases a capped social contribution tax.
On request, InterGest Hungary handles the ongoing accounting and tax returns.
Which business is good in Hungary?
Production and manufacturing are the strongest fit: for example the automotive and supplier industry or engineering, followed by IT and shared-service centres, logistics, trade and services. Foreign investors can set up a company in Hungary for almost any business purpose.
The location alone does not guarantee success. What matters is a competitive offer, clear positioning and sales tailored to the Hungarian market.
Our location advice gives you a realistic view of your industry’s prospects: see the Location section.
How do I start a small business in Hungary?
The simplest form of self-employment in Hungary is the sole proprietorship (egyéni vállalkozó): it is registered electronically and is quick to activate, but the owner has unlimited personal liability.
For very small entrepreneurs there are simplified, flat-rate tax schemes. Anyone who needs limited liability, several partners or a foreign parent company chooses the Kft instead.
InterGest advises which form fits your plan and handles the registration; a comparison is in the Legal form section above.
Can a foreigner start a business in Hungary?
Yes. Foreign individuals and companies can found a Kft and hold all of its shares. The company needs a registered seat in Hungary, and shareholders or directors not resident in Hungary usually need an agent for service (kézbesítési megbízott). InterGest Hungary can arrange both.
A personal trip to Hungary is usually not required. The formation can be completed with a lawyer by video call; the necessary documents, identity checks and powers of attorney are coordinated with the parties involved.
How much does it cost to set up a business in Hungary?
As a guide, around €5,000, mainly for the lawyer, translations and certifications; with foreign shareholders and multilingual paperwork it can be somewhat more.
On top comes the Kft share capital of HUF 3,000,000 (around €7,500). The money is not lost; it works as operating capital inside the company.
An overview is in the Costs & duration section above.
What is a Kft, and when does it fit for starting a business in Hungary?
The Kft (korlátolt felelősségű társaság) is the Hungarian limited liability company, the equivalent of a GmbH.
It fits most subsidiaries and mid-sized ventures: limited liability, 100% foreign ownership and a minimum share capital of HUF 3,000,000. For larger, capital-market structures the Zrt is the option.
A side-by-side comparison is in the Legal form section above.
What are the challenges of doing business in Hungary?
Four themes come up in practice: Hungarian-language authority and registry procedures, ongoing accounting and tax duties, bank KYC (the "Know Your Customer" checks), and the requirement for a Hungarian seat and agent for service.
None of them argues against market entry; they simply require preparation and a partner on the ground who knows the practice.
That is exactly what InterGest Hungary is there for: we know the hurdles and clear them before they slow the project down.
Which authorities and registers are involved in starting a business in Hungary?
Registration goes through the company court (Cégbíróság) into the Cégjegyzék, the Hungarian company register.
The tax and customs authority NAV issues the tax number and levies the taxes. Communication with the authorities goes through Cégkapu, and the municipality levies the local business tax.
The table in the Legal basis section lists every body with its function.
Why should I choose InterGest for starting a business in Hungary?
InterGest handles every administrative side of your business under one roof, and thinks beyond the registration itself. From the start we factor in the planned business purpose, future activities, tax requirements, management and ownership structure, and exit strategies. The result is a structure that supports day-to-day operations as well as future growth.
We help not only with the formation and registration but also with building the processes and running the company: accounting, tax, payroll, HR, payments, invoicing, grants and reporting. You have dedicated contacts who steer everything and keep headquarters and the Hungarian subsidiary connected.
On the ground, Managing Director Nils Blunck and his Budapest team guide foreign companies from formation through day-to-day business to later expansion.
You also benefit from the InterGest network: active in over 50 countries since 1972. Companies that start in Hungary can later reuse the same proven structure worldwide, for example in Germany, France or China. See the full range under all InterGest services.