Why Establishing a Hungarian Corporation Offers a Strategic Edge for Cross-Border Freelancers

Marketing Mirr Asia
5 hours ago
4 min read

As the freelance and remote-work economy expands across Europe, independent professionals are rethinking the best way to structure their businesses. While simplified regimes such as France’s micro-entreprise, Romania’s PFA, or Spain’s autónomo may offer an easy start, they often impose limitations as income grows or international operations expand.

A highly effective and often overlooked alternative is establishing a Hungarian Kft (Korlátolt Felelősségű Társaság) — a private limited liability company offering strong EU compliance, competitive taxation, and long-term scalability.

If you are a freelancer, consultant or solopreneur working across borders, this guide explains why forming a Hungarian Kft may be a more future-proof choice than relying on national micro-business regimes.

The Rise of Cross-Border Freelancing in the EU

The EU’s digital single market and freedom of services enable freelancers to operate seamlessly across borders. A growing number of self-employed professionals now work with international clients, making the choice of business structure increasingly important to ensure credibility, tax efficiency and administrative simplicity.

What Is a Hungarian Kft?

A Hungarian Kft is Hungary’s equivalent of a private limited liability company, similar to a German GmbH or UK Ltd. It is the most common business structure in Hungary for both local and foreign entrepreneurs.

Core Features of a Hungarian Kft

Limited liability for shareholders
Minimum share capital: HUF 3,000,000 (≈ €8,000 depending on FX rates)
Fast registration — typically 5–10 business days, assuming complete documentation
Eligibility for EU-wide operations, including intra-community services and cross-border invoicing
Corporate income tax rate: 9%, one of the lowest in the EU
Additional taxes such as Local Business Tax (up to 2%) may apply depending on the municipality

Trusted Reference – PwC Hungary Corporate Tax

Summary: The combination of low taxation, legal certainty and EU market access makes the Kft a compelling option for international freelancers.

What Are EU Micro-Enterprise Schemes?

EU countries offer micro-business regimes designed for simplified tax and compliance, typically for low-revenue individuals. While convenient, they have restrictions in terms of credibility, liability protection and scalability.

Examples of EU Micro-Enterprise Regimes

France – Micro-entreprise

Annual turnover thresholds: €77,700 for services
Income is taxed under the personal income tax system
Simplified accounting applies (Reference: Government of France – Micro-enterprise thresholds)

Romania – PFA

10% flat income tax on net profit
Social contributions apply once income exceeds statutory thresholds

Spain – Autónomo

Progressive personal income tax
Social security contributions are income-based (15 income brackets)

While these regimes offer simplicity, they lack corporate separation, have turnover ceilings, and may not convey the level of professionalism required for international B2B engagements.

Side-by-Side Comparison

Feature	Hungarian Kft	France Micro-entreprise	Romania PFA	Spain Autónomo
Legal Status	Company (LLC)	Individual	Individual	Individual
Limited Liability	✔ Yes	✖ No	✖ No	✖ No
Revenue Thresholds	None	€77,700 (services) / €188,700 (trade)	None (but contribution thresholds apply)	None (tax increases with income)
Tax	9% corporate tax + local business tax	Personal income tax	10% PIT + social contributions	Progressive PIT + income-based social contributions
International Credibility	High	Low–Moderate	Low	Moderate
EU VAT Eligibility	Fully eligible	Eligible but less corporate	Eligible	Eligible

When a Hungarian Kft Makes More Sense

A Hungarian Kft is ideal for freelancers who:

Earn €30,000+ annually or expect strong revenue growth
Work with international clients who prefer contracting with incorporated entities
Want limited liability protection and separation of personal vs business assets
Require EU VAT registration for cross-border transactions
Plan to scale operations, hire staff or expand to additional EU markets
Want a fully compliant EU base without offshore perception issues

How to Establish a Hungarian Kft Remotely

Hungary allows remote incorporation through a Power of Attorney (POA), making it accessible for non-residents.

Typical Kft Formation Steps

Choose and reserve a unique company name
Draft Articles of Association via a Hungarian lawyer or notary
File incorporation with the Hungarian Court of Registration
Obtain corporate tax ID and apply for EU VAT number if needed
Open a Hungarian corporate bank account (typically within 8 days after registration)
Make the capital contribution of HUF 3,000,000 as required by the Articles
Set up accounting, registered address (virtual or physical), and post-incorporation compliance

With professional support, the full process typically takes 5–10 business days, matching the timeline stated in our Hungary Kft Establishment Guide.

Why Choose Hungary Over Estonia, Cyprus or Ireland?

Hungary offers a 9% corporate tax, one of the lowest in the EU
No offshore stigma — Hungary is a fully onshore EU jurisdiction
Incorporation can be completed fully remotely via POA
Strong EU banking and VAT infrastructure
Suitable for long-term growth, unlike micro-enterprise schemes that impose thresholds

This makes Hungary a strategic choice for freelancers aiming to build a scalable EU-based business.

How Mirr Asia Helps You Establish a Hungarian Corporation

Mirr Asia provides end-to-end Hungary company formation support, including:

Drafting and translating legal documents
POA-based remote incorporation
Registered address and mail handling
Hungarian bank account introduction
Corporate tax ID & EU VAT registration
Post-incorporation compliance, bookkeeping and accounting

Final Thoughts

For freelancers looking to professionalise their structure, expand internationally, and safeguard personal assets, establishing a Hungarian Kft provides a strong, future-proof foundation. Unlike micro-enterprise regimes with turnover limits and limited liability, a Kft gives you a scalable corporate vehicle with EU reach, legal protection and long-term operational flexibility.

If you are ready to elevate your business and operate confidently across Europe, a Hungarian Kft may be the most strategic step forward.