The steps of forming a company in Hungary
If you considering company registration in Hungary, these are the steps you may want to follow:
- Consultancy
- Decision on the legal form, name, address, owners and CEO of the company
- Preparing the necessary documents
- Traveling to Hungary
- Signing the documents and form your company
- Opening a domestic bank account
Consultancy
It is always advisable that you gather information about the local legislation and business possibilities before you start your company.
Taxation, accountancy, company and civil regulations tend to be in the focus of your interest.
We provide you all the information in an understandable way by using on-line consultancy solutions like Skype, which will greatly reduce your costs.
In addition, our first consultancy is free of charge.
Before you make your move, do not hesitate to contact us and discuss all the interesting topics.
Decision on the legal form, address, name, owners and general manager of the company
In Hungary, there are basically 2 types of legal company forms:
- Unlimited financial liability – the owner or owners are responsible for the debts of the company
- Limited financial liability – the personal responsibility is limited to the registered capital
Unlimited liability company forms are:
- Business partnerships (Kkt. and Bt.)
Limited financial liability companies are:
- Limited company (Ltd.)
- Private limited company (Zrt.)
- Public limited company (Nyrt.)
All of the above mentioned company forms have their advantages and disadvantages.
The company name must be unique (i.e. not registered already) and should not contain historical names. It may be, however, full English (e.g. The New Company Hungary Kft.).
Finding a good official address is usually tricky. We may provide you with a trustworthy official seat at very competitive prices.
If you are a newcomer to Hungary, we suggest starting with a limited company (Ltd.), since it combines great structural flexibility and limited responsibility with relatively cheap maintenance and registration costs.
Please note that in Hungary the age of 18 is the limit for maturity. CEOs cannot be under the age of 18, but owners might be. However, in this case, the person in charge (i.e. parent) must agree on the ownership of the child. This is usually complicated for foreign citizens, therefore, we do not recommend to include persons under the age of 18 in the company.
Preparing the necessary documents for company registration in Hungary
You will need the following documents:
- Passport or any other documents that certificates the identity (e.g. EU driving license) of all the owners and general managers
- Any document that certifies your local address
- Any document that certifies your personal tax ID number – if any (Hungarian local personal tax number will be obtained by us)
- The founders resolution or article of foundation and the specimen of signature, if the owner will be another domestic or foreign company or legal person
Please note that official translation may be required for some of the documents.
Signing the documents and forming the company
After you collected all the required documents and consulted all the necessary topics, we provide you with a booked appointment.
At the given date, you travel to Hungary and do all the paperwork in only 1 day.
Or: you may establish your Hungarian company via authorization (power of attorney). In the latter case, you do not even need to travel to Hungary. Company registration and bank account opening will be carried out by us without your presence.
What documents you will have to sing:
- Article of foundation/incorporation – this is the founding document of your company
- List of shareholders – the listing of all the owners of the company
- Managing director declaration on the use of the place for the seat – the CEO must officially certify that the official seat is legally used
- Managing director declaration on forbiddance – The CEO must declare that he or she is not under the scope of any forbiddance
- Managing director declaration on delivering financial contribution to the company – CEO’s certification on the fact that the registered capital is paid to the company by all the owners
- Managing director declaration on the acceptance of the position and conflicts of interest – CEO accepts his or her position and declare that he or she is not affected by any obstructions
- Agreement on assignment of delivery – for every foreign owners and CEO’s, a local delivery agent should be assigned (this assignment will be undertaken by us), who will receive and forward every mails to the owners
- Agreement of assignment – an assignment that allows the lawyer to register the company at the court
We undertake the role of translation and provide you full English-language and consultancy support during the whole company formation process.
According to our experience, the Hungarian court will register your company from 2 to 15 days. Then we will send the electronic certificate of the incorporation.
Mandatory registration
After the company is incorporated by the Hungarian court, there are other mandatory registrations to be carried out:
- Local tax office
- Central tax office (NAV)
- Chamber of Commerce
- Statistical Office (KSH)
The obligations listed above will be fulfilled by us. All the documents will be sent to you electronically.
Opening a Hungarian bank account
It is required by the law for every domestic company to open a local forint (HUF) bank account. Of course, bank accounts in other currencies (EUR, USD) may be opened also.
Opening a bank account in Hungary is free of charge, however, maintaining it will cost you a certain sum in every month. You do not need to make any deposits in the beginning, however, to keep up your bank account, you may need to transfer some amount to your account regularly.
We recommend OTP Bank (https://www.otpbank.hu/portal/en/Home), since it is the largest bank in Hungary, however, any other bank may be suitable.
Usually, banks do not allow you to open your bank account unless your company is registered. Do not panic, here is what you can do:
- Stay 2 additional days and open the bank account personally
- Open the bank account by an attorney
In the former case, we will accompany you and do all the necessary translations. In the latter case, we will open the bank account for you at a discount fee (the actual fee depends on the time we have to spend on the opening which is greatly influenced by the bank itself. Commonly charged price is about 30-40 EUR).
Timeline of registering a Hungarian company
Costs of starting a Hungarian company
Register a Hungarian limited company and obtain official seat and accounting service for as low as 599 EUR. For 1 year, you will also get a 10% discount on the bookkeeping, taxation and any additional consultancy services. Also, you may be interested in our discounted upkeep fee (tax returns and financial statement).
You may also check out our company registration and other fees or fill out our Quotation form online.
You may also be interested in our comprehensive article and free eBook about how to register a company in Hungary including company registration, taxation and social security.
In Hungary, the government has cancelled company registration fees from 16th March 2017.
If you have any additional questions or require a consultancy, do not hesitate to contact us.
You may also check out the website of the Hungarian Tax Office or the on-line company registry.
Contact
If you have further questions or would like to request and inquiry, please feel free to contact us.
E-mail: whisperingtreebt@gmail.com
Tel: +36 20 548 4103