Why is Budapest a great location for start-ups?
The start-up scene in Budapest is dynamic and developed and it is witnessing a growing trend for foreign investments. Hungary’s capital city has a number of business accelerators, however, emerging companies are also at an advantage because of the overall taxation and company formation policies. Budapest offers a unique blend of characteristics for doing business that make it a great location to base a start-up. We look at some of these in this article.
Budapest, strategically located in Europe
Budapest offers a strategic location in Europe, on an easily accessible route.
The scenic location is due to its positioning along the Danube, however, investors will enjoy the fact that the city is well connected both internally and externally, with all of the major European capitals.
The city offers important opportunities for innovative start-ups and IT businesses but also for more traditional business models. Those investors who open a company in Hungary will find a number of options for operation services in Budapest, from back-office services to payroll and administrative services for their business, all at affordable costs.
Foreign investors who are looking to set up a company in a different jurisdiction can consider opening a business in Switzerland.
Business advantages in Budapest
The location of the city, combined with the fact that investors find a talented workforce here and important characteristics when basing a start-up.
However, Budapest has much more to offer. The corporate income tax rate is 9%, one of the lowest in Europe. Moreover, the costs of hiring employees are also lower compared to other European capital cities.
As far as company formation is concerned, start-up founders can choose between several main business entity types, one of the most popular ones being the limited liability company. Purchasing a ready-made company, with all of the incorporation documents is also an option for some investors. Shelf companies can be used both in Hungary but they are also an option in other jurisdictions, such as the ready-made companies in Montenegro.
Budapest offers a growing start-up scene, with important business advantages for foreign investors. This capital city is one of the top locations for opening a start-up business, whether it is in tech, IT or other business fields.