How to Close a Company in Hungary: Voluntary Liquidation of a Kft. for Foreign Owners
A solvent Hungarian Kft. is closed through voluntary liquidation (végelszámolás), and most small foreign-owned companies can use the simplified version, which has to be finished within 150 days. You pass a shareholder resolution, file closing accounts and tax returns within 30 days, settle creditors, distribute what is left and apply for deletion from the company register. You cannot simply stop filing: a company that goes silent ends up in forced cancellation, which can bar its owners and directors from running Hungarian companies.
Do you need a liquidation at all?
If the company has a clean history and someone wants it, selling the shares is quicker: the Kft. carries on under a new owner and you exit without a closure. If nobody wants it, liquidation is the only clean exit. Hungary has no “dormant company” status: as long as a Kft. is on the register it owes annual financial statements and tax returns, even with zero activity, and ignoring them leads to forced cancellation (kényszertörlés). A company that cannot pay its debts is a different case altogether — that is court-led insolvency liquidation (felszámolás), not a route the owner chooses.
Simplified or general liquidation?
The simplified procedure is open to companies that are not subject to statutory audit and can finish within 150 days of the starting date. Under the Accounting Act, a company is generally exempt from audit if, on the average of the two preceding financial years, its net revenue did not exceed HUF 600 million and it employed no more than 50 people — a threshold that most foreign-owned service companies are comfortably below.
| Simplified | General | |
|---|---|---|
| Time limit | 150 days from the starting date | 3 years from the starting date |
| Who runs it | The existing managing director | An elected liquidator (végelszámoló) |
| How it starts | Change notification to the tax authority (form T201T); NAV forwards it to the company court | Change registration filed with the company court |
| Existing powers of attorney | Remain valid | Valid only if the liquidator confirms them to NAV |
| Typical user | Single-owner Kft. with no debts and a tidy ledger | Company with assets, staff or unfinished business |
You must switch from the simplified to the general procedure if a creditor’s claim is disputed (or litigation follows from it), if an objection is filed against the liquidation, or if the 150 days run out. Within the 150 days you must file both the T201T form reporting completion and the documents for the company court; if either is missing, the tax authority’s guidance says the court terminates the procedure on the 211th day.
The procedure, step by step
1. Clean up the books first
Bookkeeping that is not up to date on day one is what most often breaks the 150-day limit. Before the resolution, make sure the bank accounts are reconciled, receivables and payables are confirmed, and there is no unexplained balance on the owner’s loan account. The ongoing obligations are described in our guide to Hungarian company accounting requirements.
2. Shareholder resolution and starting date
The owners resolve to dissolve the company without a legal successor and set the starting date of the liquidation. Every deadline below is counted from that date, so choose it deliberately — a month-end keeps the closing period clean. In the general procedure the resolution also appoints the liquidator; in the simplified procedure the managing director carries out the liquidator’s tasks, and the role is described in our article on the managing director of a Hungarian Kft..
From the starting date, the person running the liquidation is personally exposed: if tax obligations are missed during the procedure, NAV can impose the default penalty on the liquidator (or, in the simplified procedure, the managing director) rather than on the company.
3. Thirty days: closing accounts and closing tax returns
Within 30 days of the starting date, the former management must:
- prepare closing financial statements as of the day before the starting date, then deposit and publish them;
- hand the company’s records to the liquidator;
- file the activity-closing tax returns — in practice most often the corporate tax, VAT, payroll and miscellaneous-tax returns (the forms numbered ‘71, ‘65, ‘08 and ‘01), plus any earlier returns whose deadline has not yet passed.
A company under the small business tax files the KIVA return instead of the corporate tax return, because its KIVA status ends the day before the liquidation starts. Missing these duties can cost the former director a court fine of HUF 100,000 to 900,000, which may be imposed repeatedly.
4. Forty days: creditors
Once the liquidation is published, creditors have 40 days to lodge their claims. The deadline is not preclusive — a late creditor can still claim, but after deletion only against the former shareholders. The liquidator then has 15 days to draw up the list of claims and prepares a corrected opening balance sheet.
If that balance sheet shows the assets will not cover the debts, the liquidator must call on the shareholders to pay in the shortfall within 30 days. If they do not, the liquidator has to file for insolvency liquidation without delay.
5. During the liquidation: keep filing
Tax returns continue on the normal schedule, marked to show the company is in liquidation, even if there is no activity and no tax to pay. If the procedure runs past the financial year in which it began, the liquidator must prepare and deposit annual financial statements for each business year, by the last day of the fifth month after the balance sheet date.
6. Closing: three filings at once
At the end, the liquidator prepares the final financial statements, the closing tax returns and a proposal for distributing the remaining assets; the shareholders approve them by resolution. Then, within 60 days of the final balance sheet date, three things go out together:
- the final financial statements — to the Company Information Service;
- the closing tax returns — to NAV;
- the application for deletion — to the company court (in the simplified procedure, via form T201T to NAV, which passes it on).
NAV then confirms to the court that there is no tax obstacle: within 30 days in the simplified procedure, and within up to 90 days in the general one. A pending audit or unpaid tax blocks the deletion until it is resolved.
A realistic timeline for a simplified liquidation
Take a single-owner consulting Kft. with no employees, no debts and about HUF 9 million in the bank.
| Day | What happens |
|---|---|
| Before day 0 | Books reconciled, owner loan cleared, final invoices issued and collected |
| Day 0 | Shareholder resolution; starting date; T201T filed with NAV |
| By day 30 | Closing financial statements deposited; activity-closing tax returns filed |
| About day 15–70 | Notice of the liquidation and the 40-day creditor window; claims list (in the simplified route NAV forwards your notification to the company court — you do not file with the court yourself at this stage) |
| Day 70–120 | Final accounts, asset distribution proposal, shareholder approval |
| By day 150 | Completion reported on T201T; documents sent to the company court; closing returns filed |
| Afterwards | NAV clearance (up to 30 days), then deletion by the court |
How the final payout is taxed
Individual shareholders. The amount received above the acquisition cost of the share is “income withdrawn from the business”. The company withholds 15% personal income tax and reports it in its closing payroll return. The individual may also owe 13% social contribution tax, subject to the same annual cap that applies to dividends; a non-resident who is not insured in Hungary is generally outside that charge, and a double-tax treaty may limit Hungary’s taxing right. The mechanics mirror those in our guide to taking profit out of a Hungarian company.
Corporate shareholders. Hungary does not levy withholding tax on distributions paid to a foreign company, which is one of the reasons Hungarian entities are used in holding structures. How the receipt is taxed at home depends on your own jurisdiction.
A worked example. An individual founder paid in HUF 3,000,000 of share capital. After all debts and costs are settled, the Kft. has HUF 9,000,000 to distribute.
| Item | Amount |
|---|---|
| Distributed to the shareholder | HUF 9,000,000 |
| Less acquisition cost of the share | − HUF 3,000,000 |
| Taxable withdrawn income | HUF 6,000,000 |
| Personal income tax (15%) | HUF 900,000 |
| Social contribution tax (13%), if the owner falls under it | up to HUF 780,000 |
| Net to a non-resident owner outside Hungarian social security | about HUF 8,100,000 |
Decide before the resolution whether to take accumulated profit as a dividend while the company still trades or as withdrawn income at the end: the headline rates are similar, but a dividend can be spread across tax years.
The owner-loan trap
A liquidation cannot be completed while the company still has a known receivable or liability that the distribution resolution does not deal with. The classic case is a shareholder loan: money the owner lent the company to get started, still sitting on the balance sheet.
Either the company repays it before closing, or the owner waives it. If it is waived in the distribution proposal, the waived amount is booked as other income in the company’s accounts. Hungarian duty law exempts the waiver from gift duty where the liquidation ends with the company’s deletion, but the notification form still has to be filed together with the closing returns. Sort the loan out before the procedure starts.
What can be done from abroad
Almost everything. Tax filings are electronic, and your accountant can file under a standing authorisation (in the general procedure the liquidator has to confirm it to NAV). The shareholder resolution and the final approvals can be signed abroad or by a Hungarian attorney under a power of attorney — check the formal requirements with the lawyer handling the filing before you sign. Keep the bank account open until the final tax payments and the distribution have gone through, and decide in the distribution resolution who stores the company’s records and who pays for it.
Frequently asked questions
How long does it take to close a Hungarian company? A simplified voluntary liquidation must be completed within 150 days of its starting date, followed by tax clearance and deletion. The general procedure can take up to three years.
Can I close a Hungarian Kft. without travelling to Hungary? Usually yes. The filings are electronic and the corporate documents can be signed abroad or by an attorney under a power of attorney, subject to the formalities your Hungarian lawyer specifies.
Do I still have to file tax returns during liquidation? Yes — on the normal schedule, even with no activity and nothing to pay.
What happens if I just abandon the company? The company court can open a forced cancellation procedure. It ends in deletion too, but it can lead to the disqualification of owners and directors and leaves you with no control over the process.
Updated: 2026-10-07 · Tax year 2026. Based on the Hungarian tax authority’s information booklet No. 60 on voluntary liquidation (May 2026), the Company Registration Act, the Accounting Act and the Rules of Taxation Act as in force in October 2026. Treaty relief, social security coverage and home-country taxation depend on your personal situation — confirm them before the final distribution.
Thinking about closing your Hungarian Kft.? Tell us about the company and we will check the books, tell you whether the 150-day route is realistic, and handle the accounts and tax filings to deletion.