Complete Guide: Opening a Company in Hungary in 2026

Hungary has become one of the most attractive destinations for Italian entrepreneurs looking to optimize their tax structure within the European Union. With a corporate tax rate of 9%—the lowest in the EU—and an increasingly digitized bureaucratic system, Budapest offers concrete opportunities for those who want to grow efficiently and legally.

This guide covers everything you need to know to open and manage a company in Hungary in 2026.

Table of Contents

1. Why Choose Hungary
2. Available Company Structures
3. The KFT: The Most Common Choice for Italians
4. Step-by-Step Incorporation Process
5. The Hungarian Tax System in 2026
6. Registered Office and Domiciliation
7. Accounting and Annual Obligations
8. Opening a Bank Account in Hungary
9. Common Mistakes to Avoid
10. FAQ

1. Why Choose Hungary

Hungary combines exceptional tax advantages with the stability of an EU member state. The main reasons why Italian entrepreneurs choose Budapest are:

• 9% Corporate Tax: significant savings compared to Italy's 24% corporate income tax
• Reduced operating costs: rents, salaries, and professional services are, on average, 40% lower than in Italy
• Access to the EU market: free movement of goods, services, and capital
• Double taxation treaty with Italy (in force since 1977)
• Advanced digitalization: most bureaucratic procedures are conducted online

2. Available Company Structures

There are several company structures in Hungary. The most relevant for Italian entrepreneurs are:

• KFT (Korlátolt Felelősségű Társaság): equivalent to a Ltd., the most common form
• Rt (Részvénytársaság): equivalent to a PLC, for more complex structures
• Egyéni vállalkozó: sole proprietorship, for self-employment
• Fióktelep: branch of a foreign company

3. The KFT: The Most Common Choice for Italians

The KFT is the preferred company structure for Italian entrepreneurs due to its flexibility and the limited liability of its members. Key features:

• Minimum share capital: 3,000,000 HUF (approx. €7,500)
• Minimum number of members: 1
• Limited liability to the capital contributed
• Possibility of having a single member and director

4. Step-by-Step Incorporation Process

1. Name selection and availability check in the Hungarian register
2. Drafting of the articles of association by a Hungarian lawyer
3. Payment of share capital into a dedicated bank account
4. Registration with the Company Court (Cégbíróság)
5. Obtaining a tax number (adószám) from the NAV
6. VAT registration (if applicable)
7. Opening a corporate bank account

Average times: 5-10 working days for registration, 3-6 weeks for the complete process.

5. The Hungarian Tax System in 2026

The Hungarian tax system is known for its competitiveness at the European level. The main taxes for companies are:

• Corporate Income Tax (Társasági Adó): 9% on taxable profit
• VAT (ÁFA): standard rate 27%, reduced 5% and 18% for specific categories
• Social security contributions: 13% borne by the employer
• Local business tax (HIPA): max 2% of net turnover

6. Registered Office and Domiciliation

Every KFT must have a registered office in Hungary. There are three main options: own office, co-working space with a registered address, or professional domiciliation service. The latter is the most economical and flexible solution for those managing the company remotely.

7. Accounting and Annual Obligations

Accounting must be kept in Hungarian and in Forints (HUF). Key obligations include monthly/quarterly VAT returns, annual income tax return by May 31, and filing of financial statements with the company register.

8. Opening a Bank Account in Hungary

Opening a corporate bank account is mandatory for KFTs. The main Hungarian banks are OTP Bank, K&H Bank, Raiffeisen Bank, and UniCredit. Some banks require the physical presence of the owner; others accept notarized powers of attorney.

9. Common Mistakes to Avoid

• Underestimating economic substance requirements (risk of dispute with the Italian Tax Authority)
• Failing to meet Hungarian tax deadlines (significant penalties)
• Choosing an inadequate registered office
• Not planning the profit distribution structure
• Relying on consultants without specific Italian-Hungarian experience

10. FAQ

Do I need to transfer my residency to Hungary?

No, but the company must have real economic substance in Hungary. This means having a local administrator or demonstrating that business decisions are made in Hungary.

How much does it cost to maintain a KFT annually?

Annual fixed costs include: domiciliation (€500-1,500/year), accounting (€1,200-3,600/year), and local HIPA tax. The total depends on the volume of activity.

Can I have employees in Italy with a Hungarian KFT?

Yes, but the tax and social security implications in both countries must be carefully evaluated. We always recommend specific consultation before proceeding.