For US founders · 100% remote
Open a Hungarian company from the USA — an EU entity
US e-commerce, SaaS and digital founders use a Hungarian Kft as a real EU entity: an EU VAT number, single-market access and a flat 9% corporate tax — the lowest in the EU. You never have to visit; we set it up remotely and run your accounting in English.
- A genuine EU/EEA company with an EU VAT number
- 9% corporate tax — the lowest in the EU
- US owner & US director allowed — no EU residence needed
- No visit required — sign by power of attorney
What's included
- Done-for-you Kft incorporation, fully remote (PoA)
- Coordination of the mandatory Hungarian lawyer
- Registered seat (székhely) address in Hungary
- EU VAT registration for EU sales
- Bank introduction (KYC prep for US owners)
- Monthly accounting in English
● The US angle
Why US founders open an EU entity in Hungary
Sell into the EU as an insider
An EU VAT number and an in-EU entity remove third-country friction for EU customers, marketplaces and B2B clients who prefer an EU supplier — useful for e-commerce and SaaS.
9% corporate tax
Hungary's flat 9% corporate tax is the lowest in the EU. Note Hungary uses the forint (HUF) and VAT (ÁFA) is 27%.
No flight, no friction
Everything is remote via power of attorney. We coordinate the mandatory Hungarian lawyer and handle filing, banking prep and accounting in English.
How it works from the USA
From the US to a registered Hungarian Kft
Hungary has no DIY or notary-only incorporation: a lawyer (ügyvéd) must countersign and electronically file the documents. We coordinate that lawyer; you handle everything remotely from the US.
1. Consultation
We agree on name, activity, managing director and capital, confirm the Kft, and flag the US-side points to check with your US adviser.
2. Sign by power of attorney
We prepare the articles; a Hungarian lawyer countersigns. You sign remotely by PoA — no visit.
3. Filing, banking & accounting
The lawyer files electronically (registration usually 1–5 business days). We then arrange the bank introduction and accounting in English.
The treaty is gone — read this first
There is no US–Hungary tax treaty anymore
This is the single most important, and most overlooked, fact for a US founder. The United States terminated its income-tax treaty with Hungary: notice was given on 8 July 2022 and the treaty ceased to have effect for taxes withheld at source on amounts paid on or after 1 January 2024 (and for other taxes from tax years beginning on or after that date). Washington's stated reason was Hungary's veto of the EU's adoption of the 15% global minimum tax, which Hungary blocked to defend its 9% corporate rate. What that removes:
| Item | With the old treaty | Now (no treaty) |
|---|---|---|
| US-source dividends/interest to a HU company | Reduced treaty rate | US statutory 30% withholding |
| Reduced 5% dividend rate for individuals | Available | Gone — 15% Hungarian PIT applies |
| Residency tie-breaker · PE thresholds · 183-day rule | Protected | No protection |
| Mutual-agreement procedure & info exchange | Available | Ended — disputes harder |
One thing did not change: Hungary still charges 0% domestic withholding on dividends, interest and royalties paid to a foreign company. And a US corporate owner of a Hungarian company rich in Hungarian real estate can now be taxed in Hungary on the gain from selling those shares — a protection the treaty used to give. None of this makes a Hungarian Kft unusable for Americans; it means you build it with a US cross-border adviser, eyes open.
The US-person reality
CFC, GILTI, FATCA and FBAR — the US rules that follow you
Your Kft is almost certainly a CFC. If US persons own more than 50% of a Hungarian Kft, it is a controlled foreign corporation. That pulls in Subpart F and GILTI: much of the company's income can be taxed on your US return currently — in the year earned, before any dividend — with the Hungarian 9% corporate tax available as a foreign tax credit within the US rules. A US-person owner also files Form 5471 each year for the foreign corporation.
Worldwide taxation and disclosure. The US taxes citizens and green-card holders on worldwide income regardless of where they live or where the company sits. On top of the income tax come information filings: FATCA (Form 8938) for specified foreign financial assets, and the FBAR (FinCEN Form 114) for foreign bank accounts over the threshold. These are reporting obligations with real penalties, separate from any tax due. This is genuinely more involved than for founders from treaty countries — which is exactly why the US page reads differently from the others. See the Hungarian 9% tax breakdown for the local side.
- Assume CFC status — plan GILTI/Subpart F with a US cross-border adviser
- Budget for Form 5471, FATCA (Form 8938) and FBAR (FinCEN 114) filings
- Value the Kft for EU access, not for a treaty shield — there is none
A US use case
A US e-commerce brand that needs a real EU entity
A US-owned online brand keeps losing EU sales to VAT and customs friction and to marketplaces that want an EU-established seller. It opens a Hungarian Kft as its EU trading entity, with EU stock and EU VAT registration.
On €300,000 of EU-routed profit, the Kft pays Hungarian corporate tax at 9% — about €27,000 — plus local business tax (HIPA) up to 2%. Because the US owner controls it, that profit is also tested under GILTI/Subpart F on the US return in the same year, with the Hungarian tax credited — so the Kft is not a way to defer US tax, it is a way to operate inside the EU with an EU VAT number and an EU-resident supplier. When a dividend is paid to the US individual owner, Hungary applies 15% personal income tax with no treaty reduction, and the US taxes it too, using foreign tax credits to relieve the overlap. The commercial case is EU access; the tax case must be modelled, not assumed.
Banking: a US-owned Kft can open a Hungarian account or an EU EMI/fintech account after KYC; expect FATCA/CRS questions and requests for US owner documentation. We prepare the onboarding pack. Some groups add a Hungarian holding company. Ready to start? See how we form the company.
Opening a Hungarian company from the USA — FAQ
Can a US citizen or US company own a Hungarian company?
Yes. A US individual or a US company (LLC, C-Corp) can be the 100% owner of a Hungarian Kft, and a US person can be the managing director. There is no EU-residence requirement to own or direct the company. You appoint us and the lawyer by power of attorney, so it is set up entirely from the US.
Do I need to travel to Hungary to set it up?
No. The incorporation is fully remote. Hungarian law requires a lawyer (ügyvéd) to countersign the documents and file them electronically with the company court — we coordinate that lawyer, and you sign by power of attorney (PoA). Registration typically completes in 1–5 business days.
How does banking work for a US-owned Hungarian company?
We arrange a bank introduction after registration. Banks run their own KYC/onboarding and may ask US owners for additional documentation (e.g. ID, proof of address, source of funds, and information for FATCA/CRS reporting). Many founders also use EU-licensed electronic money / fintech accounts alongside a traditional bank. We help prepare the paperwork to make onboarding smoother.
How does the US–Hungary tax treaty situation affect me?
This is a careful, general point: the long-standing US–Hungary income tax treaty was terminated by the United States (notice given in 2022, effective from 2024), so the previous treaty protections may no longer apply. US persons are also taxed on worldwide income and face rules such as Subpart F / GILTI and FATCA/CRS reporting on foreign companies. None of this is tax advice — US owners should confirm their position with a qualified US (and cross-border) tax adviser before structuring.
Concretely, what did losing the treaty change for withholding and reporting?
Three practical things. First, US-source payments (dividends, interest, certain royalties) to a Hungarian company now face the US statutory 30% withholding with no treaty reduction. Second, US individual shareholders lost the former reduced 5% dividend rate, so Hungarian dividends taxed there fall under the ordinary 15% Hungarian personal income tax with no treaty relief. Third, you lose the treaty's residency tie-breaker, permanent-establishment thresholds, the 183-day employee rule, the mutual-agreement procedure and exchange-of-information framework — so double-tax disputes are harder to resolve. Hungary's own 0% domestic withholding on payments to a foreign company still stands. Sources: CMS; RSM Hungary.
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