In this article, our colleague from Gurcan Partners International, Att. Bedrettin Gürcan will mention Company Formation in Europe. Which EU country is the best option? What is best for tax and low cost? Advantages of EU Companies.
Europe is one of the safest continents in the world to do business. By means of a huge amount of domestic demand, high technologies, strategic location, and well-educated workforce it is undoubtedly that Europe sustains to attract foreign investors. European Union is the economic and political union of 28 European Countries, which have a well-integrated economic system and regulations.
We would like to draw your attention to how to start a business in Europe. Sometimes it is confusing which country is the best option to start in the EU.
When someone mentions IT business, many people show you so well-known countries like Estonia or Germany. In this article, I will explain to you why Hungary is one of the best choices for IT business in Europe besides starting your business online base.
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THE GATE OF THE 280 MILLION EUROPEAN MARKET
European Union is the richest market in the world. When you have an EU company, there will be no difference between the company in Germany and Hungary. Please check also our article on Company Formation in Germany.
Plus, your company will have much less tax wealth. (Lovest corporate tax %9)
LESS INCORPORATION COST
Incorporate and post-incorporate transactions are much cheaper than in other West Europe Countries.
By means of the low costs, your company will have competitive advantages.
POSSIBLE TO INCORPORATE IT REMOTELY
Estonia is one of the pioneer countries in the world for technological development in the governmental sectors. However, Hungary has also a good infrastructure to let business owners make many transactions online. You can check our article on Company Formation in Estonia.
Today, it is possible to incorporate it in Hungary remotely. Our professional team can handle court registration and other applications such as the tax office, social security, and chamber of commerce with Power of Attorney(PoA). It is quite easy to give us PoA. When we agree upon our service agreement, we send our PoA, which is prepared by our lawyers.
EASY TO OPEN BANK ACCOUNT
The tricky step of doing business in Europe is the bank account opening. In many countries such as Malta, Estonia, and some other countries, requests for a bank account can be rejected even if you have a registered company in these countries.
Every Company, settled in Hungary is obligated to open a bank account within 8 days of the incorporation.
To open a bank account, every shareholder must be in person at the bank. Our team assists you with all post-incorporation issues after the incorporation to open the bank account.
Having a bank account in Hungary makes your company open to the world’s most used payment systems like Paypal, Wise, and many others.
THE LOWEST CORPORATE TAX IN THE EUROPEAN UNION
Hungary has many tax benefits for business owners.
Hungary has the lowest corporate tax in the EU which is just %9.
To understand how this amount has an advantage when we compare the other European Countries:
- Germany: %30 (Check our article on Company Taxation in Germany)
- Switzerland: %18
- Poland: %19
- Bulgaria: %10 (Not part of the Schengen Area)
- Czech Republic: %19
- Estonia: %20
- Turkey:%22
However, Hungary has also one of the highest value-added taxes (VAT), which is up to %27. But If you are an IT business owner or any business, which has clients outside of Hungary, then you do not have to pay VAT at all.
Export services are exempted from the VAT in Hungary.
EU BENEFITS
When our team incorporates your company in Hungary, you will obtain EU Company ID and number as well.
It means your company can make an offer for many governments and EU tenders.
In addition, if you have products, then you will have the right to add on your products made in the EU under some conditions.
The companies in the EU have many benefits by means of several famous trade deals between the EU and other countries. (For example, some of the last ones are Mexico and Japan Free Trade Deal between the EU)
Company Formation in Europe can change your company image.
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NEW START-UP HUB OF EAST EUROPE: BUDAPEST
Have you ever been to Budapest? If not, when you visit here, you will understand what we mean.
Budapest is one of the most beautiful cities in Europe. It has a well-developed public transport system, many brand-new coworking places, and most importantly very big start-up and digital nomad community.
You can find very diverse places in Budapest, full of foreigners from all over the world.
ONE OF THE BEST STRATEGIC LOCATIONS IN EUROPE
Hungary is located in the center of Europe. It has borders with seven different countries namely:
- Slovakia,
- Croatia,
- Ukrania,
- Czechia,
- Austria,
- Serbia
- Romania.
In addition, Hungary has its own budget airline, Wizzair, which flies to 44 countries from Hungary.
If you would like to market your physical products, Hungary will be one of the best locations to reduce your company’s shipping costs.
ENGLISH FRIENDLY PLACE
Hungarian is one of the hardest languages in the world. If you would like to learn Hungarian, we are just pleased however there is no obligation to learn Hungarian in order to live or make business in Hungary.
RESIDENCY OPPORTUNITY
There is a possibility that if you have a profitable business in Hungary then you can obtain a 1-2-5 years residence permit. With Hungarian Residency, you can visit all Schengen Countries visa-free and stay there for 90 days.
To learn about business immigration in Hungary, please check our article on Business Immigration in Hungary. Also can contact us.
Conclusion:
Hungary is not a well-known place for IT Business YET. But if you make mostly export services with IT or any other sector, then Hungary is one of the best options for your business with all EU and tax benefits.
Gurcan Partners has assisted many IT businesses to move to Hungary.
If you consider starting the business in Hungary, please get in touch with us.
Company Formation in Europe
Att. Bedrettin Gürcan I Partner
All rights reserved. All rights of the Company Formation in Europe article belong to Gurcan Partners International Law Firm. The author has no responsibility for the information in this article. This article is prepared just to inform.
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