Hungary vs Czech Republic
The Czech Republic is £722 cheaper in year 1 and £766 a year cheaper after that.
| HungaryKft | Czech Republics.r.o. | |
|---|---|---|
| Costs | ||
| Minimum, year 1 | £931 | £209 |
| Minimum, per year after | £786 | £20 |
| Typical year 1 | £3,204 | £1,887 |
| Government fee | £0None. Registration and publication are free for a Kft | £34CZK 1,000 trade licence; registry free via notary |
| Indirect setup | £145–640 | £155–830 |
| Running per year | £786–4,836 | £20–2,700 |
| Share capital | HUF 3m | CZK 1 |
| Rules | ||
| Directors | No local director | No local director |
| Remote setup | Through a providerA lawyer must file and countersign. Power of attorney works. You must name a delivery agent in Hungary. | Through a providerNeeds a notary deed. Power of attorney works. |
| Audit | No audit below size thresholds | No audit below size thresholds |
| Time to form | 1 to 2 weeks | 1 to 2 weeks |
| Ease for foreign owners | 2/5 | 3/5 |
| Tax and banking | ||
| Corporation tax | 9%9%, the lowest headline rate in the EU, plus local business tax of up to 2% of gross margin. | 21% |
| Dividend withholding | None | 15% dividend withholding, 5% to UK companies by treaty, 35% outside treaty countries. |
| VAT / GST | 27%VAT 27%, the highest in the EU. | 21% |
| Banking | 2/5Usually needs a visit. | 3/5Workable with a visit. |
| All company setup fees in Hungary | All company setup fees in the Czech Republic | |
Questions
Is Hungary cheaper than the Czech Republic for company setup?
No. The Czech Republic is cheaper, at least £209 in year 1 against £931 for Hungary.
Which is cheaper to run each year?
The Czech Republic, at least £20 a year against £786 for Hungary.
Which needs a local director?
Neither. You can run a company in either without a local director.
Which is faster to set up?
About the same. Both take 1 to 2 weeks.
How does corporation tax compare?
Hungary: 9%, the lowest headline rate in the EU, plus local business tax of up to 2% of gross margin. The Czech Republic: 21%.
Sources: Hungarian National Legislation Database · PwC · Financera · Helpers Hungary · Firmin · zivnostenskylist.cz · Ganado