Hungary makes it quick to start working for yourself and slower to build a company. A sole trader can register in an afternoon, online, at no charge. A limited company needs a lawyer and at least 3 million forints of capital. Both routes carry social contributions that surprise newcomers, even in a month when you owe no income tax.
Here is how to start a business in Hungary, and what changes by route in 2026.
How do you start a business in Hungary as a sole trader?
The egyéni vállalkozó is the simplest status. Before you start you need your residence registration, your tax number and your Ügyfélkapu+ or DÁP access; see residence in Hungary for EU citizens and the Hungarian tax number guide.
- Declare the start of your activity with the tax authority (NAV), which keeps the register of sole traders. Since 19 February 2026 this is done through the Vállalkozói Ügysegéd on the NAV client portal. The older Webes Ügysegéd accepted new registrations only until 1 March 2026. You choose your activity codes there.
- Choose your tax regime at registration (see below).
- Decide on VAT. You may ask for the exemption (alanyi adómentesség) if expected turnover does not exceed 20 million HUF in the year (2026 threshold). Otherwise you charge VAT at the standard 27% rate.
- Pay contributions and advances every quarter, by the 12th of the following month, with return no. 2658.
- File your annual return by 20 May of the following year, from a draft prepared by the NAV.
Registration, changes, suspension and closure are free. The declaration also contains your registration in the county chamber of commerce, to which you owe a contribution of 5,000 HUF a year, by 31 March, unless your activity is suspended all year and you told them. A regulated activity may need a qualification or a licence; the chamber tells you which.
Which tax regime should you choose when you start a business in Hungary?
- Entrepreneurs' tax (vállalkozói szja): 9% on real profit (turnover minus justified costs), plus 15% on the part paid out as dividend. Heavier bookkeeping.
- Flat-rate regime (átalányadó): a percentage of costs fixed by law is deducted from your turnover: 45% for most activities in 2026, 80% for listed trades and services (construction, hairdressing, repairs, catering, taxi) and 90% for exclusive retail. The ceiling is 38,736,000 HUF of turnover a year, reduced pro rata if you start during the year. The flat-rate income is exempt up to 1,936,800 HUF a year, and 15% beyond. The NAV example: turnover of 7,000,000 HUF gives flat-rate income of 3,850,000 HUF and tax of 286,980 HUF.
- KATA: 50,000 HUF a month covering tax and contributions, but only for a principal-activity entrepreneur selling to private individuals. A single payment from a company, even a foreign one, ejects you from KATA from the day before the payment. Renting out property (code 68.20) also excludes you.
The tax choice is the decision with the longest tail. Moovy can compare the three regimes for your type of activity and clients and list the questions to put to an accountant. It does not file for you; the NAV registration is yours to submit.
Do you pay contributions even with the flat rate?
Yes. In 2026, outside KATA, you pay 18.5% social security (TB-járulék) and 13% social contribution (szociális hozzájárulási adó), the latter only up to 7,747,200 HUF of income in the year. The monthly base is at least the minimum wage, 322,800 HUF, or the guaranteed minimum, 373,200 HUF, if your main activity requires a secondary-school qualification. If self-employment is your main activity, they remain due in a month when your flat-rate income is exempt from tax, except a month fully suspended or covered by certain benefits. If you are already insured in Hungary as an employee, the social security contribution is based on your real income instead. The 112.5% uplift on the social contribution base disappeared on 1 January 2026.
Local business tax (helyi iparűzési adó) of at most 2% of the base may apply, depending on your municipality. And if you stay insured in another country with an A1 form, your status for KATA and your contributions need checking. A salaried teleworker for a foreign employer is not self-employed; talk to the employer first.
Should you form a Kft. instead?
The korlátolt felelősségű társaság (Kft.) needs at least 3,000,000 HUF of capital, and each capital contribution must be at least 100,000 HUF (Civil Code, art. 3:161). Registration with the company court must be made by a lawyer. It is exempt from registration duty and publication fees for a Kft. After registration, the company pays corporate income tax at 9% (2026), local business tax up to 2%, and VAT at 27% unless exempt. Dividends to an individual partner are taxed at 15%, plus the 13% social contribution while that person's income for the year stays under 7,747,200 HUF (2026).
A Kft. must keep full accounts, and bookkeeping must be handled by a registered accountant, unless its average net turnover for the two previous years does not exceed 20 million HUF. The annual corporate tax return is due by 31 May. A Kft. can choose the small business tax (KIVA), 10% in 2026, under conditions such as 100 employees at most and 6 billion HUF of turnover.
For a small turnover, a sole trader on the flat rate is often simpler.
What changes by nationality?
EU, EEA and Swiss citizens have the same access as Hungarians. British citizens arriving after 2020 need the "guest self-employment" permit (vendég-önfoglalkoztatás), requested on Enter Hungary for 26,000 HUF in 2026 and extendable up to three years in total; see moving to Hungary from the UK. If you also want to work as an employee, see working in Hungary.
Your business also needs a business bank account and a clear invoice process; see bank account in Hungary. Thresholds and rates are revalued each year, so confirm them with the NAV.
Before you choose a status, have your own case checked by a Hungarian accountant or tax adviser: your clients, your health cover and the country you are insured in change the best answer.
What does a freelancer in Hungary need to keep?
A sole trader is not covered by the accounting act, so you do not need an accountant by law. You keep the records that the tax rules require, for example a register of receipts under the flat-rate regime if you do not recover VAT. In practice many freelancers still hire an accountant, especially for the first year and for VAT. The cost is set freely by contract, so ask for a written quote.
Keep your invoices in order, put business money in a separate account (see bank account in Hungary), and diarise the dates: the 12th of the month after each quarter for advances and contributions, 20 May for the annual return. A late payment is the commonest and the most avoidable mistake.
What are the traps of the KATA regime?
KATA looks attractive at 50,000 HUF a month, but it is built for the person who sells to private individuals and works full time on the activity. You cannot hold a salaried contract of at least 36 hours a week, and you cannot be insured in another EU country under an A1 form. One receipt from a company or another payer, even a foreign one, takes you out of KATA from the day before the payment. Above 18 million HUF of turnover in a year (1.5 million HUF per month of KATA if you start during the year), a special tax of 40% applies to the excess, to be declared and paid before 25 February of the following year.
How do you set up as a sole trader step by step?
- Register your stay, get your tax number and your Ügyfélkapu+ access.
- File your start of activity in the NAV client portal and pick the regime.
- Decide on VAT exemption or 27% VAT.
- Join the county chamber of commerce through the same declaration.
- Pay your first quarterly advance and contributions on time.
For the tax side, read income tax in Hungary. Rules and thresholds change each year, so confirm them with the NAV before you register.