HIPA is charged on revenue rather than profit, so it is payable in loss-making years as well. What that means for companies with thin margins or a long ramp-up.
- KIVA small business tax regime
- Local business tax (HIPA)
- Why does Hungary tax revenue as well as profit?
Hungary applies a flat 9% corporate income tax rate, the lowest in the EU, uniformly across company sizes with no progressive bands. The Kft, Hungary's standard limited liability company, requires HUF equivalent of roughly €7,500 in minimum share capital, available for immediate operating use after formation rather than held in escrow.
What a company pays in Hungary. Every figure below is published on the Hungary country page.
| Hungary | |
|---|---|
| Corporate tax rate | 9% flat (lowest in the EU) + local business tax up to 2% of net revenue + 0.3% innovation contribution |
| VAT standard rate | 27% |
| VAT reduced rates | 18% and 5% |
| Accounting standard | Hungarian Accounting Act standards, or IFRS for listed/consolidated entities |
| Currency | HUF (Hungarian forint) |
What makes it complex in Hungary
- KIVA small business tax regime — — entry threshold raised to 100 employees and HUF 6 billion revenue from December 2025, an alternative to standard CIT for qualifying companies.
- Local business tax (HIPA) — levied on net revenue, not profit — payable even in loss-making years, up to 2% depending on municipality.
Why does Hungary tax revenue as well as profit?
In addition to the 9% corporate income tax on profit, Hungarian municipalities levy a local business tax (HIPA) of up to 2% on net revenue, plus a 0.3% innovation contribution on the same base. Both apply regardless of profitability, meaning a company with strong revenue but a loss-making year still owes these taxes.
What is the KIVA regime and who can use it?
KIVA is an alternative small business tax regime taxing the sum of personnel costs and dividends rather than standard accounting profit. As of December 2025, eligibility was expanded to companies with fewer than 100 employees and revenue/balance sheet under HUF 6 billion, with exit thresholds raised to 200 employees and HUF 12 billion.
KIVA small business tax regime is one of the points HTLC Network handles for clients operating in Hungary, within a single engagement that covers every other country they operate in — executed locally, governed centrally.
In Hungary the scope is: Statutory accounts, VAT returns, and corporate tax filings aligned with Hungarian accounting standards, including local business tax (HIPA) and real-time invoice reporting compliance.
See Accounting & Tax Compliance in Hungary for the full scope, or the Hungary country page for the statutory framework across every service.
Figures as published on the HTLC Network country pages, reviewed September 2026 and collected from public sources. They are not a substitute for advice on a specific case and should be verified before being relied on.