The Kft. (Korlátolt Felelősségű Társaság) is Hungary's most common company form, and for good reason. With a low minimum capital requirement of HUF 3 million (approximately €7,500), limited liability protection, and access to the EU's lowest corporate tax rate at 9%, the Kft. is the go-to structure for e-commerce businesses looking to establish a presence in Hungary or use it as a European hub.
Why choose a Kft.?
Limited liability is the primary advantage: members are only liable up to their capital contribution, meaning personal assets like property, savings, and vehicles are protected from business debts. The Kft. offers flexible management structures and can operate with a single member (egyszemélyes Kft.) or multiple members. Foreign nationals and companies can be members without restrictions, making it accessible for international entrepreneurs. The Kft. is also the preferred entity type for marketplace registrations on eMAG, Alza.hu, and other Hungarian platforms.
Formation steps in detail
- Articles of association: Prepared and countersigned by a Hungarian lawyer (ügyvéd). The document includes the company name, registered office (székhely), business activities (TEÁOR codes), member details, and capital structure. The lawyer submits the application electronically to the Cégbíróság (Court of Registration).
- Registered office: A registered office service (székhelyszolgáltatás) or own premises is required. The NAV may inspect the registered office, so it must be a real, accessible address where company documents are stored.
- Bank account and capital deposit: At least 50% of the share capital must be deposited before registration, with the remainder due within one year. Hungarian banks like OTP, K&H, and Raiffeisen offer business accounts.
- Court of Registration filing: The simplified procedure takes 1 business day, while the standard procedure takes up to 15 business days. The company receives its cégjegyzékszám (company registration number) upon approval.
- NAV tax registration: Tax number application, VAT declaration (exemption or registration), and NAV Online Számla technical user setup for e-invoicing compliance.
Taxation of a Kft.
Hungary's 9% corporate tax rate (TAO) is the EU's lowest, providing a significant competitive advantage. Local business tax (HIPA) is typically around 2% but varies by municipality. Dividend tax is 15%, plus 13% social contribution tax up to an annual cap of HUF 780,000. The KIVA (small business tax at 10%) is an alternative that replaces corporate tax and social contributions, making it attractive for employment-heavy e-commerce operations with warehouse staff and customer service teams.
Costs and timelines
Lawyer fees typically range from HUF 50,000 to 150,000. Registration duties are HUF 50,000 for simplified procedure or HUF 100,000 for standard. Total formation costs are HUF 150,000-300,000 plus the share capital. Zunapro offers complete formation packages for e-commerce entrepreneurs, including registered office services, NAV registration, marketplace onboarding, and NAV Online Számla setup.
