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Everyone knows about the popular Rubik's Cube puzzle now. Most people know that this toy got its name thanks to the surname of its creator, Rubik. But many people do not attach importance to the fact that Erne Rubik is a Hungarian professor, a teacher of architecture. But Hungary can be proud of at least 13 Nobel laureates. By the way, the first ballpoint pen was also invented in this country.
Unlike the countries of the Balkan peninsula bordering the sea, many tourists do not consider Hungary as a maritime power, but as a country rich in thermal waters, with the largest lake in Central Europe, they visit with pleasure. This fact makes it possible to open a fairly profitable business of various directions here.
In general, there are a number of advantages for businessmen in Hungary:
The founder of a company in Hungary, regardless of his citizenship, can receive benefits and subsidies from the state. Thus, companies related to the hotel business, winemaking, travel agencies and agencies whose activities are aimed at the field of art are eligible for simplified taxation. And the best business projects can be fully funded by the state. In addition, the Government allocates certain subsidies (about 5,000 euros) to businessmen who conduct business in regions with low levels of employment when hiring local residents. Bureaucratic procedures have also been significantly simplified: pan-European business standards are being actively implemented in Hungary, which affects the opening of new companies. Mostly foreigners open companies related to IT technologies, logistics, tourism, production of industrial goods and food. Much attention in Hungary is paid to winemaking, which many entrepreneurs consider for their business. Hungarian wines are known all over the world, and historically they appeared even before the famous French brands.
Another important factor for many businessmen is the possibility of relocating their business to the territory of the Hungarian state. In the face of harsh Western sanctions, this is an opportunity to maintain the competitiveness of your company. The country has a special IP Box tax regime, which provides for the following:
50% of the income that qualifies as royalty can be taken into account when calculating tax profit.
Depreciation charges can be taken into account as an additional deduction from income tax, with the cost of research and development work.
There is no tax on income from licensing fees received when selling intellectual property outside Hungary, if the income is used outside the country and the owner is not a resident.
Exemption from capital gains received upon alienation of intellectual property after 12 months of ownership.
What kind of companies can be opened in Hungary?
When answering this question, it is important to take into account a number of factors: the number of partners, the field of employment, the amount of start-up capital, the goals and objectives of the founder of the company. It is necessary to consult with lawyers on taxation issues, which is right for you.
A limited liability company (Korlatolt Felelossegu Tarsasag) is registered with the economic court: a founding agreement and articles of association are necessarily drawn up, and a managing director is appointed. Half of the authorized capital is paid in immediately upon registration. If there is only one founder, then the authorized capital is paid in full in the amount of 3 million forints, which can be represented in the form of various financial assets. When registering a company, the citizenship of the founder does not matter, but it is necessary to open an account in a Hungarian bank. This form (Kft) is most common in Hungary, as there are no strict requirements for the number of employees. It is suitable for small and medium-sized businesses in various fields of activity. The disadvantage of Kft is that the company will not be able to sell shares on the open market.
Joint Stock Company (Reszvenytarsasag - Rt) — the company assumes any number of shareholders, including non-residents of Hungary. At the same time, securities (shares) are issued for the total amount of the authorized capital. A joint—stock company can be either closed (Zrt) — the minimum authorized capital is 5 million forints, or open (NyRt) - the authorized capital is 20 million forints. At the time of registration of the company, it is necessary to pay about 30% of the authorized capital. The company's account must also be opened in a Hungarian bank, and it must be managed by a Board of Directors consisting of at least 3 members (individuals) and a Chairman at the head. The owners' votes and their responsibility to third parties are divided in proportion to their investments. And the shareholders themselves receive their share of profits in the form of dividends. A joint-stock company has the right to openly sell its shares, so this type of business is suitable for large companies.
Partnership with unlimited liability (Kozkereseti tarsasag - Kkt) — the company is registered in the arbitration court. At the same time, there must be at least two partners (individuals or legal entities), regardless of citizenship status. The partners have equal rights, and the authorized capital (its minimum size is not indicated) is distributed among the shareholders. The management is carried out by the general partners on the basis of the company's articles of association, and all decisions are made at general meetings, since each Kkt participant is responsible for the obligations of the company with his property. Shares and liabilities are distributed evenly among all participants. If one of the partners wishes to give a share to a third party, this issue is submitted to the General Meeting. An account is also opened in a Hungarian bank. This company can start commercial activity immediately after the partners determine the start-up capital, the form of business and the area of employment.
Limited Liability Company (Betiti tarsasag - Bt) — the company is registered in a friendly court and is a business company. The company must have at least two founders (an individual and a legal entity, as well as non-residents of Hungary). Bt's internal participants (General Partners) are liable for obligations with their own assets, participants with limited rights do not incur such obligations. The minimum amount of the authorized capital has not been set, but it is usually deposited from 5,000 to 100,000 forints (it is distributed among all shareholders). Any of the Bt participants can become the managing director of the company. When deciding to give a share to a third party, the issue is also submitted to the General Meeting.
Individual enterprise (as self-employed — Egyeni vallakkozo or in the form of a company licensed by Egyeni ceg) - the company is registered online through the state portal, which indicates the appropriate taxation, field of activity and provides a notarized founding act. The founder of the sole proprietor is personally responsible for the activities of the business with all his property. In Hungary, such companies are opened mainly by novice businessmen whose goal is to enter the European market. Individual entrepreneurs in Hungary are mainly owners of coffee shops, snack bars, hairdressers, etc. It is important that in order to obtain a residence permit, it is necessary to open an individual entrepreneur under an Egyeni ceg license, it is impossible to obtain a residence permit for the self—employed.
It should be noted that there are a number of advantages for business immigration to Hungary:
With all the advantages and positive aspects, starting a business in Hungary has a number of difficulties that you can face without knowing all the rights and laws of the state. Therefore, we always recommend contacting reliable agencies for all questions. This will allow you to open a business in full compliance with Hungarian law.
