Types of Structures in Hungary - Guide for Investors

Entrepreneurs who want to open a company in Hungary have several types of legal structures to choose from. In Hungary, Book Three of the Civil Code (Act V of 2013) governs the regulation of companies.

If you are interested in opening a company, you are welcome to get in touch with our lawyers in Hungary. They can guide you in detail about the types of structures in Hungary and their regulations.

Quick Facts
Support in setting up a company in Hungary (YES/NO)	Yes, clients can rely on our Hungarian lawyers for business representation services.
Applicable legislation	The Companies Law.
Availability of sole proprietorships (YES/NO)	Yes, individuals can operate as sole entrepreneurs (egyéni vállalkozó) or register a sole-trader firm (egyéni cég).
Availability of partnerships (YES/NO)	Yes, general and limited partnerships are available for registration.
Availability of limited liability companies (YES/NO)	Yes, private limited liability companies, private and public companies limited by shares.
Options for foreign companies	– branches, – subsidiaries, – representative offices.
Particularities of sole traders	The sole trader can operate as a self-employed individual, holding personal liability for the business’s debts and obligations.
Requirements to create partnerships	Both types of Hungarian partnerships require at least 2 participants and are established based on partnership deeds.
Limited liability companies registration requirements	– at least one shareholder, – at least one director, who need not be a resident; however, a non-resident director must appoint a Hungarian delivery agent, – a local address.
Minimum share capital requirements (where applicable)	– HUF 3 million (approx. EUR 8,000) for private limited companies, – HUF 5 million (around EUR 13,000) for private companies limited by shares, – HUF 20 million (approx. EUR 52,000) for public companies.
Other legal forms available (if any)	– cooperative companies, – professional associations.
Features of the cooperative company	The cooperative has a legal personality and is used for social purposes.
Characteristics of the professional association	The professional association is a non-profit organization that can pursue economic activities.
Business registration timeframe (approx.)	Around 2 weeks for the private limited liability company.
Special requirements for foreign investors/entrepreneurs	Foreign investors from non-EU countries must consider immigration formalities if they want to relocate to Hungary.

Types of companies in Hungary

According to the Hungarian Companies Act, there are several main types of companies that can be established in Hungary.

• Limited Shares Company: a legal entity that requires a minimum hare capital of 5,000,000 or 20,000,000 HUF; If you want to open this type of structure in Hungary, get in touch with our lawyers;

• Limited Liability Company: a legal entity that requires a minimum share capital of 3,000,000 HUF; the LLC is a popular type of company in Hungary, similar to a private limited company in other countries. It requires at least one shareholder and one managing director, and the liability of shareholders is limited to their capital contributions;

• Unlimited partnership: it has legal personality (since 15 March 2014) and there is no minimum share capital necessary for its incorporation; It is a type of company in Hungary where all partners have unlimited liability for the company’s debts and obligations. It requires at least two partners who are jointly and severally liable for the company’s obligations;

• Limited partnership: this type of company in Hungary is like the unlimited partnership, it has legal personality and does not require a minimum share capital; at least one member has unlimited liability.

• Joint Stock Companies: this is a type of company in Hungary that can be private (Zrt.) or public (Nyrt.); only the shares of a public company are listed on a stock exchange. It requires a minimum share capital and has a board of directors and a supervisory board. JSC can be private or public and the public ones are listed on the Budapest Stock Exchange; the minimum share capital for a Hungarian public joint stock company is 20 million HUF, and for private joint stock companies the minimum share capital is 5 million HUF.

The share capital of a company that is founded by a single member must be paid in full prior to the submission for company registration.

Limited liability companies (Kft.) and limited shares companies (nyrt or zrt.) are mostly used by business owners in Hungary. Our Hungarian lawyers can offer you more details about the specific liabilities of the shareholders, according to the type of company. Our attorneys can also help you comply with the taxation system in Hungary.

Company incorporation in Hungary

Regardless of the type of Hungarian company, the first step towards forming a new company in Hungary is preparing the Articles of Association. They must be signed by all the members and legalized by a notary public. Our attorneys in Hungary can also countersign the Articles of Association.

The new company can begin to operate once the Articles of Association have been signed. However, also it needs to be registered at the Court of Registration. The new business needs to be reported to the Court of Registration within 30 days after the Articles of Association have been signed.

Our Hungarian law firm offers specialized legal services and complete services for company incorporation in Hungary, from company registration to assistance in opening a bank account in Hungary. Please contact us for detailed information and personalized offers.

Company incorporation steps in Hungary

Incorporating a company in Hungary involves several steps. For instance:

Choose a company name: The name of the company must be unique and not already registered in Hungary. You can check the availability of your desired company name on the Hungarian Company Information System website;
Draft the articles of association: This document sets out the rules for running the company, including the share capital, the number of shares, the rights and obligations of the shareholders, and the procedures for appointing and removing directors;
Deposit the share capital: The minimum share capital required to incorporate a limited liability company in Hungary is HUF 3 million (approximately EUR 8,300). The share capital must be deposited into a Hungarian bank account;
Register the company: The registration process can be completed electronically only, through a Hungarian attorney or notary (legal representation is mandatory), at the competent Court of Registration. You will need to provide the articles of association, proof of deposit of the share capital, and other relevant documents;
Obtain a tax number: All companies operating in Hungary must have a tax number. The tax number is assigned by the Tax Authority (NAV) automatically during the company registration procedure;
Register for social security: All companies must register with the National Tax and Customs Administration (NAV) and pay social security contributions for their employees.
Register for VAT: If your company’s turnover exceeds HUF 20 million (2026 threshold, approx. EUR 50,000) per year, it can no longer use the optional VAT exemption and must charge VAT;
Obtain any necessary permits and licenses: Depending on the nature of your business, you may need to obtain additional permits and licenses before you can start operating;
Open a bank account: You will need to open a Hungarian bank account for your company to receive payments and pay expenses.

Once you have completed all these steps, your company will be incorporated and you can begin operating in Hungary. It is recommended to consult with our local Hungarian lawyers to ensure that you comply with all legal requirements and regulations.

Besides this, our lawyers can also assist you if you are interested in immigration to Hungary.

The benefits of company formation in Hungary

There are several benefits to forming a company in Hungary, including:

Low corporate income tax rates: As mentioned earlier, the corporate income tax rate in Hungary is one of the lowest in Europe, which makes it an attractive destination for foreign investors;
Strategic location: Hungary is located in the heart of Europe, with easy access to both Western and Eastern European markets. The country is also a member of the European Union, which makes it an ideal location for businesses looking to expand into the EU;
Skilled workforce: Hungary has a highly educated and skilled workforce, particularly in the fields of engineering, IT, and manufacturing;
Business-friendly environment: Hungary has a relatively simple and transparent business registration process, and the government has implemented several measures to support entrepreneurship and foreign investment;
Competitive costs: The cost of living and doing business in Hungary is generally lower than in other Western European countries, which can result in significant cost savings for companies;
EU funding opportunities: Hungary is eligible for funding from the European Union, which can provide financial support for research and development, innovation, and other business activities.

Forming a company in Hungary can offer numerous advantages, particularly for businesses looking to establish a presence in Europe or expand their operations in the region. Get in touch with our Hungarian lawyers for legal assistance.

If you are planning to acquire Hungarian citizenship, the services of our lawyers are at your disposal.

Taxation in Hungary

In Hungary, the corporate income tax (CIT) rate is a flat 9% for all companies, regardless of their profit (there is no higher bracket). The tax year in Hungary is the calendar year, and companies must file their tax returns by May 31 of the following year.

In addition to the corporate income tax, companies in Hungary may also be subject to other taxes, such as value-added tax (VAT), local business tax, and social security contributions for employees. The VAT rate in Hungary is generally 27%, with reduced rates of 5% and 18% for certain goods and services.

It is important to note that there are various tax incentives and exemptions available for companies in Hungary, such as research and development tax credits, investment tax credits, and exemptions for certain types of income. It is recommended to consult with our local tax expert or accountant to ensure that you are taking advantage of all available tax benefits while remaining compliant with Hungarian tax laws and regulations.

Our Hungarian law firm offers specialized legal services for company incorporation in Hungary. Please contact us for detailed information and personalized offers.

If you need information about opening companies in other countries, such as Iran or Portugal, we can help you get in touch with a local specialist.

Ádám Tálosi, Attorney at Law · 2 October 2026Dr. Ádám Tálosi studied at the Faculty of Law of the Károli Gáspár University of the Reformed Church.