Hungary business residency for US citizen starting his own company after 10 years in a family business

Jordan, a US citizen, has worked in his family business since university. For the past few years, he has served as a finance director.

After nearly 10 years of working under his father, Jordan established his independence by launching his custom furniture manufacturing company. He aimed to enter the EU market and eventually distribute his products globally.

Hungary was Jordan’s first and only choice. This country held a special place in his heart. His family originally came from Hungary, and as a child, Jordan often travelled there with his parents to visit his great-grandparents. These trips gave him a deep appreciation for Hungary’s culture and way of life.

Hungary is in Central Europe with a population of 9.59 million. It is a member of the European Union and the Schengen Area, granting residents and citizens visa-free travel within these states. Hungary is also part of NATO.

Budapest, the capital of Hungary, is home to 1.69 million people and is renowned for its stunning bridges, thermal baths, and historic architecture.

Hungarian is the country’s sole official language, but English proficiency is high, especially in Budapest.

Besides holding personal significance for Jordan, Hungary appealed to him from a business perspective. The country offered several advantages:

• a streamlined process for setting up a business;

• the EU’s lowest corporate tax rate of 9%;

• a strategic location within the EU, providing access to lucrative markets.

Without much deliberation, Jordan decided to obtain Hungarian residence.

To explore residence permit options, Jordan consulted several immigration agencies. Ultimately, he chose Immigrant Invest, impressed by the team’s responsiveness and attention to detail.

Requirements for the applicant. To obtain the Hungary Business Visa, a foreigner must meet the following criteria:

• be over 18;

• come from a non-EU and non-EEA country;

• have no entry ban to Hungary or other Schengen states;

• have no criminal record in Hungary or other Schengen states.

The applicant must also confirm a bank account balance of €10,000 and a legal monthly income.

Entrepreneurs can bring their close family members, including spouses, children under 18, and financially dependent parents.

Requirements for the company. Applicants can register the following types of companies in Hungary:

• Kft., or limited liability company;

• Rt, or joint-stock company;

• Kkt., or unlimited liability partnership;

• Bt., or limited liability partnership.

The minimum capital varies based on the type of company. For instance, registering a limited liability company requires a capital of at least €7,700.

Some sectors demand entrepreneurs to obtain special licences from the Hungarian government. This applies to businesses in banking, pharmaceutical manufacturing, or investment services.

In addition, the company must generate at least €1,500 annually.

Jordan established a limited liability company, Kft., in Budapest with a capital of €8,000. His company specialises in custom furniture manufacturing and sells products to private clients and legal entities.

Jordan is the sole founder of the company. His team currently includes two employees: a product designer and a marketing manager. The actual furniture manufacturing is outsourced to contractors.

As the owner of a business in Hungary, Jordan is required to pay the following taxes:

• a corporate tax of 9%;

• a social tax of 13% of the wage fund;

• a 27% VAT will apply only if the company’s annual turnover exceeds €30,500.

Hungary also allows municipalities to impose an additional tax. However, Budapest, where Jordan registered his company, does not charge this tax.

In the US, corporate tax is 21%, which is almost 2.5 times higher than in Hungary. Additional taxes may also be levied at the state level. Employers contribute to a social security tax of 6.2% and a medicare tax of 1.45% of wages. VAT is not imposed; instead, consumers pay a sales tax at the point of sale.

With a business residence permit, Jordan moved to Hungary in November 2024. After settling, he focused on developing his company and now dedicates nearly all his time to it. He hired two employees, signed agreements with contractors, manufacturers, and suppliers, and launched a marketing campaign. By 2027, Jordan aims to achieve an annual turnover of €30,000.

Living in Hungary appeals to Jordan. He enjoys architecture, cuisine, and nature. Visiting prominent sights has brought back fond childhood memories. His favourite place is Pécs, the city where his great-grandparents once lived.

Jordan appreciates how easy it is to integrate into Hungarian society. Budapest offers a welcoming environment, with friendly locals and a thriving expat community. While many people speak English, Jordan has started learning Hungarian to honour his family’s heritage.