Hungary has been part of the European Union since 2004 and is part of the EU’s single market. The country is a medium sized open economy in Central Europe. It can be a great place to incorporate a business, if structured well, incorporation in Hungary can be a tax-efficient solution.
Benefits include low Corporate Tax rates between 10% and 16% and no requirement to appoint local shareholders and directors, meaning that the company can be fully owned and controlled by international directors and shareholders.
Additional advantages of forming a corporate entity in Hungary include low (in some cases exemption from) capital gains and dividends tax. However, Hungarian company formation is not seen as an offshore corporate structure or a tax haven.
Some types of companies will benefit more than others in Hungary; for example a holding company, as dividends paid to any resident or non-resident person are legally tax free and any paid royalties are considered expenditures and can be deducted from corporate profits.