How to Start a Business in Hungary to Secure a Residence Permit

Starting a business in Hungary offers a viable path to securing a residence permit. Zlata Erlach, Head of the Austrian office, Investment Programs Expert at Immigrant Invest, explains the steps, requirements, and alternatives for high-net-worth individuals looking to relocate their business to Hungary and gain residency under the Hungary Golden Visa.

Hungary Residence Permit by Business Registration Overview

In Hungary, business registration can lead to a residence permit. This permit enables you to reside and work in Hungary. The country’s strategic location in Europe and its favourable business environment make it an appealing choice.

To qualify for Hungarian residency by opening a company, you must own a business or plan to establish one in Hungary. Benefits include access to the EU market, high quality of life, and a stable economy. This permit is often the first step towards long-term residency or citizenship.

The residence permit for starting a company is valid for 1 year and can be extended once for an additional 2 years.

Requirements for Applicants

Basic requirements. Applicants must be non-EU citizens, possess a clean criminal record, and have adequate financial resources.

A foreign national must establish a legal entity in Hungary, equivalent to an LLC or JSC. Your business should contribute to the Hungarian economy. The minimum required authorised capital for the company is €7,700.

Business plan and proof of funds. You need a detailed business plan. This plan should outline your business activities and economic impact. Evidence of adequate funds to cover your business and personal expenses is crucial.

Residency and physical presence. While it is not mandatory to stay in Hungary year-round, you should have a local address. Demonstrating a genuine commitment to your business increases your chances of approval.

List of Documents

Gather these documents to apply:

1. Valid passport.
2. Completed application form.
3. Recent passport-sized photos.
4. Proof of business registration or intention to register.
5. Detailed business plan.
6. Proof of sufficient funds.
7. Health insurance coverage.
8. Proof of accommodation in Hungary.
9. Clean criminal record certificate.

Make sure all documents are translated into Hungarian and notarized. Having proper documentation expedites the application process and minimises delays.

How to Relocate Business to Hungary: Step-by-Step Process

Step 1. Research and planning. Understand the Hungarian market. Develop a viable business plan. Identify your business structure. Research local regulations and industry-specific requirements. It is beneficial to consult with local business advisors or legal experts to navigate the Hungarian business landscape effectively.

Step 2. Legal and financial setup. Register your business with the Hungarian authorities. Open a local bank account. Ensure compliance with tax regulations. Hungary offers several types of business entities, but the limited liability company, Kft, is the most popular among foreign investors.

Registering a Kft involves choosing a unique company name, drafting the articles of association, and registering with the Hungarian Court of Registration.

Step 3. Submit application. Prepare and submit your residence permit application. Submit all necessary documents along with the application fee. You can apply at the Hungarian consulate in your home country or directly in Hungary. The process can take several weeks to a few months, depending on the completeness of your documentation and the specifics of your case.

Step 4. Await approval. The review process can take several months. Respond promptly to any additional requests from the immigration office. During this period, it is crucial to remain patient and be prepared to provide additional information or clarification as required.

Step 5. Establish operations. Once approved, establish your business operations. Hire local employees if needed. Engage with local business networks. Setting up your office, hiring staff, and starting operations is a significant step towards integrating into the Hungarian market. Participate in local business events and networks to build relationships and gain insights into the local business culture.

Step 6. Maintain compliance. Adhere to Hungarian laws and regulations. Submit annual reports and pay taxes promptly. Consistently review your business plan to maintain success. Adhering to local laws is vital for the sustainability of both your business and residency status. Frequently consult with legal and tax advisors to stay informed about any regulatory changes.

Hungary Golden Visa — Alternative Way to Get Residence Permit in Hungary

The Hungary Golden Visa provides another path to 10-year residency. Investors have three options to choose from. The minimum investment required is €250,000. This investment must be made within 93 calendar days of the investor’s first entry into Hungary using the Guest Investor Visa.

Hungary Golden Visa benefits include the ability to live and work in Hungary and travel within the Schengen Zone; opportunity to open a bank account and move to a safe country with low cost of living.

Application process involves:

1. Investing in eligible assets.

2. Submitting the Golden Visa application with required documents.

3. Awaiting approval, which typically takes several months.

4. Receiving the residence permit upon approval.

The Golden Visa is quicker and less dependent on business performance. However, it requires a significant financial investment.

Conclusion

Starting a business in Hungary can secure a residence permit, offering a gateway to European living and business opportunities. Make sure you fulfil all requirements and carefully prepare the necessary documents. Alternatively, the Hungary Golden Visa is a viable option for those able to make the required