Our team of specialists can help investors establish a subsidiary in Hungary, which is one of the options for setting up a business for a foreign company expanding into a new market.
| Quick Facts | |
|---|---|
| Definition of a subsidiary | A subsidiary is a sub-division of a parent company operating abroad, which is independent from the parent company (separate legal personality) and which is set up following the national incorporation rules available for companies in the country where it develops its operations. |
The main characteristics of a subsidiary | – set up as a legal entity, – independent from the parent company, – the parent company is the main shareholder of the legal entity operating in Hungary, – subjected to taxation in Hungary. |
Law applicable to subsidiaries | – Act X of 2006, – Act V of 2013, – Act XLV of 2004, – EU Parent-Subsidiary Directive. |
| Documents necessary to establish a subsidiary in Hungary | – the incorporation documents of the parent company (articles of association, certificate of registration issued by the authorities of the country where the parent operates), – the decision to set up a subsidiary, the Certificate of Good Standing of the parent company, – the identity documents of the persons representing the company, – the power of attorney (where applicable), documents translated into Hungarian, – registration forms, etc. |
| Capital requirements (yes/no) | Yes |
| Company types for subsidiaries | – public limited liability compay, – private limited liability company. |
| Registration institutions | – the Hungarian Registration Court, – Chamber of Commerce and Industry, – National Office for Health Insurance, – the Hungarian Ministry of Economy. |
| Duration of the process to establish a subsidiary in Hungary | Approximately 15 days. It can start its operations in 5 days after registering for social security. |
| Taxes imposed to Hungarian subsidiaries | Hungarian subsidiaries are liable to paying all the taxes charged to local companies (corporate income tax, VAT, employment taxes, withholding taxes, etc.) |
| Notary public procedures (yes/no) | Yes |
| EU Parent-Subsidiary Directive applicable in Hungary (yes/no) | Yes |
| Minimum capital | HUF 3 million (limited liability company)/ HUF 20 milion (public company)/ HUF 5 million (private limited company) |
| Parties involved in the registration process | – the representatives of the Hungarian institutions, – the public notary, – the company’s appointed representatives, – our consultants in company formation in Hungary, – lawyers. |
| Main incorporation steps | – choosing the suitable legal entity, – preparing the documentation, – register with the local authorities, – register for taxation and social security, – open a corporate bank account and submit the necessary capital, – set up a business address, – obtain a tax identification number. |
| Incorporation services offered by our consultants | Our team can provide legal assistance in any of the steps mentioned above which are compulsory in order to establish a subsidiary in Hungary and can offer post-incorporation services as well, such as tax advice, tax compliance, accounting services. |
| Registration obligations for taxation | A subsidiary is required to apply for a VAT number and a Tax Identification Number during the registration formalities, and this is completed with the National Tax and Customs Administration. |
Best Used For | Investors can establish a subsidiary in Hungary if they want to set up a business that has the following characteristics: – independence from the parent company, – diversification of the business activities, – access to tax benefits offered to businesses in Hungary (the subsidiary is treated as a Hungarian incorporated business). |
Publication fee | Companies in Hungary must pay a publication fee, charged at HUF 5,000, through which they publicly announce the incorporation of the business (exemptions are granted based on the legal entities selected for registration). |
| Penalties | Please mind that if you want to establish a subsidiary in Hungary will be asked to pay penalties if you do not comply with the applicable law/reporting in due time. The fees vary from HUF 50,000 to HUF 900,000. |
| Management (Local/Foreign) | Foreign management is allowed. |
| Legal representative requirements | It is necessary to appoint a legal representative. |
| Local bank account setup procedure | The subsidiary is required to set up a corporate bank account at a commercial bank in Hungary. The procedure takes around 2 weeks and the company’s representatives have to provide all the incorporation documentation (of the parent company and the documents attesting the registration of the subsidiary). |
| Independence from the parent company | The subsidiary is an entity that is independent from the parent company, it has its own legal personality, but the parent company is the main investor (owning at least 50% of the subsidiary’s shares). |
| Liability of the parent company | Limited to the amount invested. |
| Corporate tax rate | 9% |
| Annual accounts filing requirements | If you will establish a subsidiary in Hungary as a Kft., Zrt., or Nyrt., tax filing and accounting reporting obligations will arise. The annual reports must be concluded as per the Hungarian tax and accounting law and in accordance with the: – yearly turnover, – number of employees, – the corporate assets’ value. |
| Possibility of hiring local staff (YES/NO) | Yes |
| Travel requirements for incorporating branch/subsidiary (YES/NO) | No |
| Number of double tax treaties signed by Hungary | More than 80 treaties. |
| Access to investment incentives | Qualifying foreign businesses can obtain investment incentives through the Hungarian Investment and Promotion Agency. |
Table of Contents
What are the characteristics of subsidiaries in Hungary in 2026?
A Hungarian subsidiary can be registered only as a corporate body, so it has to take the form of a company that has its own, distinctive legal personality. In most of the cases, investors will choose a joint stock company or the limited liability company, but, in practice, the latter is the most common way to start a subsidiary in Hungary. If you want toopen a company in Hungary, our team can help you.
What are the documents for subsidiary registration in Hungary?
During the process of company formation in Hungary, all businessmen have to prepare a set of documents regardless of the company type they choose to register. In the list below,our specialists in company formation in Hungarypresent the main documentation that must be prepared for the registration:
- the articles of association and the memorandum of the parent company and the Certificate of Good Standing of the parent company, all documents being issued in the country where parent company is registered;
- the official translation of such documents into the Hungarian language;
- the decision of the parent company, through which it establishes that it will set up a subsidiary in a foreign country;
- investors will also have to sign a power of attorney and provide samples of specimen signatures of the company’s representatives.
Are there any capital requirements when setting up a subsidiary?
Yes, investors will have to subscribe a minimum share capital when they establish a subsidiary in Hungary, in accordance with the company type selected.
What are the capital requirements?
There are 3 minimum share capital options, as follows:
- a public company limited by shares (Nyrt.) has a capital requirement of HUF 20 million;
- a private company limited by shares (Zrt.) established in Hungary is founded based on a share capital of at least HUF 5 million;
- investors can also set up a limited liability company (Kft.), which is founded with a capital of HUF 3 million.
Do I need to have a registered address in Hungary?
Yes, this is a prerequisite of the process of company formation in Hungary for all company types, subsidiaries included. Investors must secure a registered address during the registration formalities and must provide proof of the respective location, where the company will carry out its operations.
The infographic below presents how to establish a subsidiary in Hungary:
What are the main registration services your team provides?
Our team is specialized in offering professional company formation services. For the registration of a corporate entity registered as a private limited company, we offer the following services:
- we will prepare the registration documentation in English and Hungarian;
- we will obtain a VAT registration number for the company (local and foreign companies incorporated in Hungary need to apply for VAT registration provided that they are VAT payers);
- through our local partners, we can offer accounting services.
What are the fees charged for company incorporation services?
Our fee starts at EUR 950 and it contains the company formation package we have presented above. Please mind that the fee package does not contain the company’s minimum share capital, the accountants’ fee, registered address costs.
Is it possible to complete remote company registration formalities?
Yes. Investors are not legally required to be present during the process of company incorporation in Hungary and they can sign the documentation remotely, with our assistance. However, for this procedure we apply a separate fee and we recommend you get in touch with us for further details.
We invite you to watch a short video on how to establish a subsidiary in Hungary:
Do I need to pay any state registration fees?
Please know that during the registration, you will be asked to pay processing fees. The registration fees vary based on the type of company you will register. In 2026, the fees vary from HUF 50,000/HUF 100,000. Please know that if you establish a subsidiary in Hungary registered as a limited liability company, you will not pay state registration fees, as these have been abolished.
How long does it take to establish a subsidiary in Hungary?
Investors who want to set up a subsidiary in 2026 must know that the incorporation will take approximately 15 days.
What are the advantages of the EU Parent-Subsidiary Directive?
Hungary has adopted the EU Parent-Subsidiary Directive which allows the exemption from the withholding tax on dividends paid to a company based in a EU country. If the company is not situated in the EU, it can still have privileges granted by the many double tax treaties signed by Hungary across the years (more than 60).
Please contact our Hungarian company formation specialists for more information regarding Hungarian subsidiaries.