Today, Hungary offers the most friendly terms of registration, management and taxation of companies in continental Europe. In 2017, Hungarian companies will pay the lowest corporate income tax in the EU (9%). Besides, Hungary offers excellent conditions for the creation of holdings and for operations with intellectual property (royalties). Together with the automatic registration of VAT number (which is very important when trading in the EU), it makes Hungary one of the best countries for business.
TRADING COMPANY
Currently, the income tax in Hungary for companies whose earnings do not exceed HUF 500 million (about 1.8 million euros) is just 10% . It is one of the lowest rates in the EU. Also in Hungary a VAT number issued to the company during the registration and there is no need for additional expenses (office rent, hiring employees, etc.) to maintain it. This allows easy trading activities throughout the EU using the VAT rate of 0%.
HOLDING
Hungary offers excellent conditions for holding companies. Dividends received from companies registered in the EU are not subject to income tax. Subsidiaries are also exempted from dividend taxation when the following conditions are met: