Hungary is a new,
undiscovered bridge to tax heaven!
0% withholding tax on dividends!
0% withholding tax on interests!
0% withholding tax on royalties!
According to the new provisions under the
Hungarian Income and Corporation Tax Act, as of January 2006, when
paying dividend to any natural or legal person, resident or not resident
in Hungary, the withholding tax on dividends is 0%. What is more, the
royalties and interests that a company pays qualify as expenditure, and
as such, are exempt from withholding tax. These modifications to the
Hungarian tax provisions enable this small Central-European country to
become an important participant on the European holding market, and with
a huge advantage: it is not yet in the focus of the tax authorities.
This offers you a very good opportunity to carry on with (or start) your
tax optimization plans on a new market, in a more legal and discreet
Some reasons for choosing Hungary
Compared to the traditional participants of the European holding and tax
optimization market, being more discreet is only one of the many
advantages that Hungary offers to companies. This country has a perfect
geo-strategic location, and is a full-fledged member of the European
Union since May 2004. This means that a company registered in Hungary
can apply for, and get a European Union Tax-ID, which entitles it to
handle its European businesses VAT-free. The Hungarian
tax authorities, upon request, issue a certificate that states that the
company is subject to Hungarian taxation; this enables the company to
profit from the benefits of more than 50 double taxation
agreements that Hungary has signed. More over, legal persons
can also be a member/shareholder of the company, so there is no
reason why an offshore company could not own the shares of the company,
guaranteeing both secrecy and the exercise of ownership rights at the
same time. No data regarding the beneficial owner will be registered,
neither his bank references will be required. There are no currency
restrictions; the company is entitled to have any kind of bank accounts
in a foreign country. The incorporation, the establishment of a company
can be implemented in a relatively short period of time (despite the
slightly complicated official procedures), and the company is entitled
to start its activities immediately after signing the deed of