If you want to be self-employed in Hungary, your first decision is the legal structure: register as a sole trader (egyéni vállalkozó) or set up a limited company (Kft, short for korlátolt felelősségű társaság). Both are accepted for the guest self-employment permit, so the choice is really about your business, not your visa. Here is how they compare.
| Sole trader (egyéni vállalkozó) | Kft (limited company) | |
|---|---|---|
| Setup | Free, online, often the same day | A lawyer is required; about one to four weeks |
| Startup capital | None | 3,000,000 HUF (about €7,500) |
| Liability | Personal and unlimited | Limited to the company |
| Accountant | Optional on the simple tax regimes | Mandatory |
| Tax | Flat-rate, KATA, or standard income tax | 9% corporate tax, then tax on dividends |
| Best for | Freelancers and solo service work | Larger ventures, partners, higher-risk work |
The sole trader (egyéni vállalkozó)
A sole trader is the simplest way to work for yourself. Registration is free and done online, often the same day, and there is no startup capital. The catch is that you and the business are the same legal person, so you are personally liable for its debts. Sole traders also get access to Hungary’s simplified tax regimes, which keep paperwork light. It suits freelancers, consultants, and most one-person service businesses. See our guide to registering as a sole trader for the steps.
The Kft (limited company)
A Kft is a separate legal entity, the Hungarian equivalent of a limited liability company. It needs 3,000,000 HUF of share capital (you do not always have to pay it all in immediately) and, by law, a Hungarian lawyer to set it up and a Hungarian accountant to run its books. In return you get limited liability, so your personal assets are protected, a more corporate image for larger clients, and the option for several owners. Company profits are taxed at Hungary’s 9% corporate rate, with further tax when you draw profits as dividends. See our guide to setting up a Kft.
Which one for the self-employment permit?
Both work. The guest self-employment permit is granted whether you register as a sole trader or act as the managing director of your own Kft. So pick the structure that fits the business you actually want to run, then build the permit application around it.
How to decide
- Choose sole trader if you are a freelancer or consultant, want to start cheaply and quickly, and your work carries little financial risk.
- Choose a Kft if you are building something bigger, want to protect your personal assets, plan to take on partners or investors, or work with large clients who prefer dealing with a company.
- If you are unsure, many people start as a sole trader and move to a Kft later as the business grows.
Not sure which route fits your plans? Our business and self-employment service connects you with a licensed Hungarian lawyer who can set it up correctly the first time. Book a consultation to talk it through.
Frequently asked questions
Should I register as a sole trader or set up a Kft in Hungary?
A sole trader (egyéni vállalkozó) is free, fast, and simple, and suits freelancers, but you are personally liable. A Kft gives limited liability and a corporate structure but needs 3,000,000 HUF capital, a lawyer, and an accountant. Choose by the size and risk of your business.
Do I need startup capital to be self-employed in Hungary?
Not as a sole trader, registration is free with no capital. A Kft requires 3,000,000 HUF (about 7,500 euros) of share capital, though you do not always have to pay it all in straight away.
Which structure has limited liability?
The Kft. As a sole trader you and the business are the same legal person, so you are personally liable for its debts. A Kft is a separate legal entity, so your liability is limited to the company.
Does the self-employment permit accept both?
Yes. The guest self-employment permit is granted whether you register as a sole trader or act as the managing director of your own Kft, so choose the structure that fits your business.