Tagged with restricted reserves

Restoring equity – Objections of the Hungarian Tax Office

The equity of a Kft (LLC) must always exceed 50% of the issued capital. The Companies Code in principle provides several ways to restore equity: waiver of debt results in a profit taxable under normal conditions, so companies are trying to solve this problem by an additional payment or a capital increase. However, the Hungarian Tax Office may re-qualify these methods when they involve companies in liquidation.

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