Kft
Hungarian LLC
- What it is
- The Hungarian form of limited liability company
- Equivalent
- A familiar limited company: the company, not personal property, is liable for its debts
- What is required
- Share capital, a registered address, a director, accounting
- Why it is set up
- Business in the country and in the EU, working with local counterparties
- An important nuance
- A company and a residence permit are different procedures
In plain words
A Kft is the Hungarian form of limited liability company, the local equivalent of a familiar limited company. The logic is the same: the company has separate legal personality, and the company itself, not the members’ personal property, is liable for its obligations, unless personal guarantees have been given.
Setting one up requires share capital, a registered address in the country, a director and constitutional documents; the details are entered in the register. The company then keeps accounts and files reports under local rules. The jurisdiction is within the European Union, which is convenient for working with European counterparties and settlements in euro.
As in other countries, registering a company does not equal obtaining a residence permit. These are two different procedures with different requirements. If the company is being set up as part of an immigration plan, it is important to understand in advance what exactly the chosen route assesses: genuine activity, turnover, employees, not the mere existence of a legal entity.
Why a Kft is set up
What the company needs
- Share capital
- How it is paid in
- Confirmation
- Registered address
- Director
- Members and shares
- Accounting
- Tax registration
- Annual reporting
- The companies register
- Beneficial owners
- The bank’s check
How the company is set up
- 01Define the task and structure
- 02Preparing documents
- 03Registration and entry in the register
- 04Opening an account
- 05Accounting and reporting
What you need to know
- The members’ liability is limited
- A registered address in the country is required
- Accounts are kept under local rules
- Company details go into the register
- A company does not give the right of residence automatically
Common mistakes
- Treating company registration as a route to a residence permit
- Underestimating accounting costs
- Setting up a company without an activity plan
- Not taking CFC rules in the country of residence into account
- Forgetting reporting deadlines
What this means for a BRIDGES client
We look at the company as part of the overall picture: it may evidence your source of income in the check and at the same time create obligations after the move. We work through both sides before anything is registered.
Frequently asked questions
01 /What is a Kft?
The Hungarian form of limited liability company, the local equivalent of a familiar limited company.
02 /Does the company give a residence permit?
No. Registering a company and obtaining a residence permit are different procedures with different requirements.
03 /Is a local address needed?
Yes, the company needs a registered address in the country of registration, to which official correspondence is sent.
04 /Is reporting difficult?
Reporting is done under local rules and requires professional support. Late filing leads to penalties.
05 /Can the company open an account?
Yes, but the bank will check the activity, the ownership structure and the beneficial owners. A company without clear activity runs into difficulties.
06 /Does the company affect my taxes?
Yes. After a change of tax residence a foreign company may fall under CFC rules in your country of residence.
See also
Read next
This material has undergone editorial review by BRIDGES.
Need a company in Europe?
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