In the summer of 2010, the Hungarian Government decided to establish one of the most favorable corporate tax systems within the European Union. To this end, the former 19% corporate tax rate has been reduced to 10%. Limitation to the 10% tax rate is a maximal annual turnover of HUF 500.000.000 (approx EUR 2.000.000). As of 2013, the Government plans to spread the 10% tax rate also to corporations that are above the current turnover limit.
In addition to the above, a special exemption applies to the taxation of royalty income. In case of income that originates from royalty payments, only 50% of that income needs to be declared as tax base. As a result, the effective tax rate for royalty income is 5%.
For more information on this matter, please contact FirmaX Hungary. Our professional tax consultants will advise you on the set-up of the most favorable tailor made tax structure that fits to your needs.