{"id":13959,"date":"2023-11-08T21:06:44","date_gmt":"2023-11-08T21:06:44","guid":{"rendered":"https:\/\/www.bup.at\/?page_id=13959"},"modified":"2023-11-22T09:48:58","modified_gmt":"2023-11-22T09:48:58","slug":"doing-business-in-austria-2","status":"publish","type":"page","link":"https:\/\/www.bup.at\/en\/doing-business-in-austria-2\/","title":{"rendered":"Doing Business in Austria"},"content":{"rendered":"\t\t<div data-elementor-type=\"wp-page\" data-elementor-id=\"13959\" class=\"elementor elementor-13959\" data-elementor-post-type=\"page\">\n\t\t\t\t<div class=\"elementor-element elementor-element-54659ed e-con-full e-flex e-con e-parent\" data-id=\"54659ed\" data-element_type=\"container\">\n\t\t\t\t<div class=\"elementor-element elementor-element-7dbc7e4 bup-bg-image-overlay--on bup-ani--onload bup-layout--page elementor-widget elementor-widget-bup_page_header_widget\" data-id=\"7dbc7e4\" data-element_type=\"widget\" data-widget_type=\"bup_page_header_widget.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t<header class=\"bup-page-header\"><div class=\"bup-page-header-bg\">  <div class=\"bup-page-header-bg-inner\"><\/div><\/div><div class=\"bup-page-header-content\">  <div class=\"bup-page-header-t  bup-ani-t bup-ani-tr\"><\/div>  <div class=\"bup-page-header-c  bup-ani-cl\">    <div class=\"bup-page-header-heading  bup-ani-textIn\"><p>Doing Business<br \/>\nin Austria<\/p>\n    <\/div>  <\/div>  <div class=\"bup-page-header-b  bup-ani-b bup-ani-br\"><\/div><\/div><\/header>\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t<div class=\"elementor-element elementor-element-9cf251e e-flex e-con-boxed e-con e-parent\" data-id=\"9cf251e\" data-element_type=\"container\">\n\t\t\t\t\t<div class=\"e-con-inner\">\n\t\t<div class=\"elementor-element elementor-element-02c2af3 services-background e-flex e-con-boxed e-con e-parent\" data-id=\"02c2af3\" data-element_type=\"container\" data-settings=\"{&quot;background_background&quot;:&quot;classic&quot;}\">\n\t\t\t\t\t<div class=\"e-con-inner\">\n\t\t\t\t<div class=\"elementor-element elementor-element-fb2569c elementor-widget elementor-widget-text-editor\" data-id=\"fb2569c\" data-element_type=\"widget\" data-widget_type=\"text-editor.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t\t\t\t\t<div id=\"text_business_start-ups\">\n<h3>Business Start-Ups<\/h3>\n<h4>Business Start-up Promotion Act (<em>Neugr\u00fcndungsf\u00f6rderungs&shy;gesetz<\/em>)<\/h4>\nIf you intend to set up a company, you will be expected to pay various fees. However, if your business start-up meets a number of requirements set forth by what is known in Austria as the <em>Neugr\u00fcndungsf\u00f6rderungsgesetz<\/em> (which translates as Business Start-up Promotion Act), certain fee exemptions may apply.\n\nYour start-up might be exempt from the following fees:\n<ul>\n \t<li><strong>stamp duty<\/strong>\u00a0(<strong><em>Stempelgeb\u00fchren<\/em>)<\/strong>,<\/li>\n \t<li><strong>administrative fees<\/strong>\u00a0(<strong><em>Bundesverwaltungsabgaben<\/em>)<\/strong>,<\/li>\n \t<li><strong>real property transfer tax (<em>Grunderwerbsteuer<\/em>),<\/strong><\/li>\n \t<li><strong>court fees (<em>Gerichtsgeb\u00fchren<\/em>),<\/strong><\/li>\n \t<li><strong>payroll fringe costs (<em>Lohnnebenkosten<\/em>).<\/strong><\/li>\n<\/ul>\n<h4>Industrial law (<em>Gewerberecht<\/em>)<\/h4>\nIn Austria, a number of trades require some sort of qualification certificate. You will need a <strong>business license<\/strong>, especially if the nature of your work requires skilled labour (e.g., a mechanic or a carpenter)<strong>.<\/strong>\u00a0The qualification you need to provide depends on the type of business you intend to establish.\n\n<strong>To obtain a business licence you generally need to:<\/strong>\n<ul>\n \t<li>have Austrian or EU\/EEA citizenship;<\/li>\n \t<li>be a natural person aged 19 or older;<\/li>\n \t<li>have no reasons for exclusion in your records (e.g., financial offence, court sentence);<\/li>\n \t<li>have a business location and, if required, hold an operating licence (<em>Betriebsanlagengenehmigung<\/em>).<\/li>\n<\/ul>\nIf you intend to establish\u00a0<strong>a corporation or a partnership<\/strong>, you need to appoint\u00a0<strong>one managing director<\/strong>\u00a0who\u00a0<strong>holds the right to exercise this trade<\/strong>\u00a0(e.g., a carpentry business must have at least one fully qualified carpenter as its managing director).\n\nSole proprietors are required to designate a licensed managing director if they do not meet the requirements themselves.\n\nThere are a lot of unregulated trades for which you do not need any qualification (e.g., any kind of trading).\n\n<\/div>\n<div id=\"text_legal_forms\">\n<h3>Legal Forms<\/h3>\n<strong>In Austria there are a number of legal forms to choose from when starting a company:<\/strong>\n<ul>\n \t<li><strong>sole proprietorship<\/strong><\/li>\n \t<li><strong>corporations:<\/strong>\n<ul>\n \t<li>limited liability company (GmbH)<\/li>\n \t<li>joint stock corporation (AG)<\/li>\n \t<li>societas Europaea (SE)<\/li>\n \t<li>public or private foundations (<em>\u00d6ffentliche<\/em> <em>Stiftung<\/em> or <em>Private Stiftung<\/em>)<\/li>\n<\/ul>\n<\/li>\n \t<li><strong>partnerships<\/strong>:\n<ul>\n \t<li>general partnership (<em>Offene Gesellschaft<\/em>)<\/li>\n \t<li>limited partnership (<em>Kommanditgesellschaft<\/em>)<\/li>\n \t<li>partnership under civil law (<em>Gesellschaft B\u00fcrgerlichen Rechts<\/em>)<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<h4>Sole proprietor (<em>Einzelunternehmer<\/em>)<\/h4>\nSole proprietors have unlimited personal liability for all of their company\u2019s debts and obligations, providing coverage with their business assets as well as personal property.\n\nThe law does\u00a0<strong>not require any specific starting capital<\/strong>.\n<h4>Legal forms<\/h4>\nIn Austria, the legal forms are: joint stock corporation (AG), private company with limited liability (GmbH) or a European company (societas Europaea \u2013 SE).\n\n<strong>The legal forms typically share a number of characteristics:<\/strong>\n\nThe company itself is a legal entity and has its own legal identity. <strong>Proprietors are not personally liable for their company\u2019s debts and obligations<\/strong>. Their liability is limited to the amount of their capital contribution. The law requires some starting capital and the amount in starting capital required depends on the legal form of the entity. Once entered on the commercial register (known as the <em>Firmenbuch<\/em>), a corporation comes into legal existence.\n<h4>Limited liability company (GmbH &#8211; LLC)<\/h4>\nIn Austria the most popular corporation is the limited liability company known by its abbreviation\u00a0<em>GmbH<\/em>. Proprietors can be individuals as well as legal entities. A\u00a0<em>GmbH<\/em>\u00a0can also be established by only one shareholder. Each shareholder is obliged to invest capital in the company. The designation\u00a0<em>Gesellschaft mit beschr\u00e4nkter Haftung<\/em>\u00a0or\u00a0<em>GmbH<\/em>\u00a0has to be added at the end of the company name.\n\nA limited liability company\u2019s\u00a0<strong>share capital<\/strong>\u00a0amounts to \u20ac 35,000. At the time of incorporation, half of this amount or \u20ac\u00a017,500.00 needs to have been paid in. Newly set up companies have the option of limiting share capital under a privilege for start-ups. In that case, only \u20ac10,000 need to be paid for the first ten years.\n<h4>Joint stock corporation (AG)<\/h4>\nA joint stock corporation is known as an\u00a0<em>Aktiengesellschaft<\/em>\u00a0(AG) and can be established either by natural or legal persons. The designation\u00a0<em>Aktiengesellschaft<\/em>\u00a0or\u00a0<em>AG<\/em>\u00a0must be added at the end of the company name. This legal form is typical for larger business companies.\n\nThe corporate bodies of joint stock corporation are the\u00a0<strong>general meeting of shareholders<\/strong>\u00a0(<em>Hauptversammlung<\/em>), the\u00a0<strong>supervisory board<\/strong>\u00a0(<em>Aufsichtsrat<\/em>) which needs to consist of at least three people and the\u00a0<strong>board of directors<\/strong>\u00a0(<em>Vorstand<\/em>). The shareholders get to elect the supervisory board, and the supervisory board gets to appoint the board of directors.\n\nSetting up a joint stock corporation requires\u00a0<strong>capital stock in the amount of \u20ac 70,000<\/strong>. As opposed to the limited liability company, the capital stock of an AG is split into shares. Like the limited liability company, the joint stock corporation has to be entered on the commercial register. At least 25 percent of the stock capital must have been paid at the time of registration.\n<h4>European company (SE)<\/h4>\nThe European company (societas Europaea, SE) is\u00a0<strong>based on European law<\/strong>. The advantage of this legal form is that the same law applies to it across Europe. A European company is formed by reorganising an existing company, for instance by way of a merger or by converting an AG. This explains why start-ups are usually not set up as an SE. The SE must have\u00a0<strong>capital stock<\/strong>\u00a0of at least\u00a0<strong>\u20ac 120,000<\/strong>.\n<h4>Foundation (Stiftung)<\/h4>\nThere are two types of foundations:\u00a0<strong>public foundations<\/strong>\u00a0(e.g., a charity) and\u00a0<strong>private foundations<\/strong>. Foundations need to be entered on the commercial register. They operate as holding companies and do not perform any trade or commercial activity themselves.\n\nA private foundation must have\u00a0<strong>assets of at least<\/strong>\u00a0<strong>\u20ac 70,000<\/strong>. Unlike other types of corporations, the private foundation does not have a proprietor. The foundation itself owns the assets.\n<h4>Partnerships<\/h4>\nPartnerships include the\u00a0<strong>general partnership (<em>Offene Gesellschaft<\/em>), limited partnership (<em>Kommanditgesellschaft<\/em>), partnership under civil law (<em>Gesellschaft B\u00fcrgerlichen Rechts<\/em>)<\/strong>\n\n<strong>Characteristics they share:<\/strong>\n\nAll partnerships have in common that they must have at least one partner with unlimited liability. There are no formal requirements for a partnership.\n\nIn this case too, the designation of the legal form (i.e.: <em>offene Handelsgesellschaft<\/em> or OG, <em>Kommanditgesellschaft<\/em> or KG), has to be added after the company name.\n<h4>General partnerships (Offene Handelsgesellschaft, OG)<\/h4>\nTo set up a general partnership, two or more natural or legal persons are needed. They must assume\u00a0<strong>personally liability for their company\u2019s debts and obligations<\/strong>. In other words, the proprietors are not only liable with their business assets but also with their personal assets.\n\nNo minimum capital stock is required. The proprietors are not required to contribute any cash. Any of the proprietors can take on the management of the business.\n\nPartnerships are legalised once they are entered on the commercial register.\n<h4>Limited partnerships (<em>Kommanditgesellschaft<\/em>, KG)<\/h4>\nThe structure of a limited partnership (<em>Kommanditgesellschaft<\/em> or KG) is similar to that of a general partnership (OG). It also need to be entered on the commercial register.\n\nThe main difference is that <strong>general partners<\/strong> (<em>Komplement\u00e4r<\/em>) have unlimited liability while\u00a0<strong>limited partners<\/strong>\u00a0(<em>Kommanditist<\/em>) are\u00a0<strong>liable<\/strong>\u00a0<strong>only for the amount of their liability deposit<\/strong>. The personally liable partner can also be an entity, usually a GmbH, which is then called a <em>GmbH &amp; Co KG<\/em>.\n<h4>Partnership under civil law (<em>Gesellschaft B\u00fcrgerlichen Rechts<\/em>)<\/h4>\nA partnership under civil law\u00a0<strong>does not have its own legal identity.<\/strong> Therefore, it cannot be entered on the commercial register. It is not a company in its own right. All the partners must meet the requirements set forth by industrial law and all of them have unlimited liability. This form is usually set up for short-term projects.\n\n<\/div>\n<div id=\"text_taxes\">\n<h3>Taxes<\/h3>\nThe most important taxes are:\n<ul>\n \t<li><strong>income taxes<\/strong>: income tax\u00a0(<em>Einkommenssteuer<\/em>) and corporate income tax (<em>K\u00f6rperschaftsteuer<\/em>), capital gains tax\u00a0(<em>Kapitalertragsteuer<\/em>)<\/li>\n \t<li><strong>value-added tax\u00a0<\/strong>(Umsatzsteuer)<\/li>\n \t<li><strong>real property transfer tax<\/strong>\u00a0(<em>Grunderwerbsteuer<\/em>)<\/li>\n<\/ul>\n<h4>Income taxation<\/h4>\n<h4>Income tax (<em>Einkommenssteuer<\/em>)<\/h4>\nNatural persons whose\u00a0<strong>place of residence<\/strong>\u00a0(<em>Wohnsitz<\/em>) or\u00a0<strong>habitual place of residence<\/strong>\u00a0(<em>gew\u00f6hnlicher Aufenthalt<\/em>)\u00a0<strong>is in Austria<\/strong> are obliged to pay income tax. Basically, they are subject to income tax on their\u00a0<strong>worldwide income<\/strong>.\u00a0<strong>Non-resident taxpayers<\/strong>\u00a0<strong>only<\/strong>\u00a0need to pay<strong> income tax for<\/strong>\u00a0their\u00a0<strong>Austrian income<\/strong>. Generally, earnings are subject to income tax if they fall into one of the seven income categories under fiscal law, which are:\n<ul>\n \t<li>income from agriculture and forest economy;<\/li>\n \t<li>income from independent services;<\/li>\n \t<li>income from trade and business;<\/li>\n \t<li>income from employment;<\/li>\n \t<li>income from capital investments;<\/li>\n \t<li>income from rent and leasing;<\/li>\n \t<li>other earnings.<\/li>\n<\/ul>\nIn a first step, these seven items are added up. Once any special and extraordinary expenses have been subtracted, you have the basis for income tax calculation. Income tax is a\u00a0<strong>progressive tax ranging from 0 to 55 percent.<\/strong>\n\nAnnual income of up to\u00a0<strong>\u20ac 11,693 (in 2023) does not require the payment of any income tax<\/strong>.\n\nIn Austria, employees receive 14 monthly salaries a year. The 13<sup>th<\/sup>\u00a0and 14<sup>th<\/sup>\u00a0salaries are subject to tax privileges.\n\n<strong>Companies and income tax\n<\/strong>Sole proprietors and partners in partnerships are likewise subject to income tax.\n\n<strong>Taxation of partnerships:\n<\/strong>The partnership itself is not subject to taxation. The profit is directly attributed to the partners and they are subject to income tax.\n\n<strong>Corporate income tax (<em>K\u00f6rperschaftsteuer<\/em>)<\/strong>\n\nThe profits of corporations are subject to corporate income tax. Corporate income tax is\u00a0<strong>24 percent\u00a0<\/strong>(non-progressive, in 2023).\n\nCorporate income tax payers are required to pay a\u00a0<strong>minimum tax amount<\/strong>\u00a0regardless of whether the corporation makes a profit or not.\u00a0<strong>Limited liability companies (GmbH)<\/strong>\u00a0are required to pay \u20ac 1,750 a year.\u00a0<strong>Newly set up companies are expected to pay \u20ac 500 a year over the first five years, \u20ac 1,000 a year over the subsequent five years and \u20ac 1,750 a year thereafter.<\/strong>\n\n<strong>Joint stock corporations<\/strong>\u00a0pay a minimum of \u20ac 3,500 in taxes.\n\n<strong>Capital gains tax (<em>Kapitalertragsteuer<\/em>)<\/strong>\n\nCapital gains tax is withheld for dividends paid and for interest on bank deposits as well as bonds.\u00a0<strong>27.5 percent are withheld at source<\/strong>\u00a0so individuals are not obliged to pay capital gains tax themselves.\n<h4>Value-added tax (<em>Umsatzsteuer<\/em>)<\/h4>\nThe VAT rate is\u00a0<strong>20 percent<\/strong>. In some\u00a0<strong>special cases<\/strong>\u00a0this rate has been reduced to\u00a0<strong>10 or 13 percent.<\/strong>\n\n<strong>Real property transfer tax (<em>Grunderwerbssteuer<\/em>)<\/strong>\n\n<strong>Land<\/strong>\u00a0<strong>acquisition<\/strong>\u00a0is subject to a\u00a0<strong>3.5 %<\/strong>\u00a0real property transfer tax on the purchase price.\n\n<\/div>\n<div id=\"text_social_security_system\">\n<h3>Social security system<\/h3>\nThe social security system in Austria is based on the principle of\u00a0<strong>compulsory insurance<\/strong>\u00a0(<em>Pflichtversicherung<\/em>). It includes\u00a0<strong>accident insurance<\/strong>\u00a0(<em>Unfallversicherung<\/em>), <strong>pension insurance\u00a0<\/strong>(<em>Pensionsversicherung<\/em>) and\u00a0<strong>health insurance\u00a0<\/strong>(<em>Krankenversicherung<\/em>).\n\nBoth the employer and the employee pay towards social security. The insurance contribution is deducted by the employer from the employee\u2019s total monthly earnings.\n<div class=\"table \">\n<table>\n<thead>\n<tr>\n<td><\/td>\n<th scope=\"col\">Contribution of the Employee<\/th>\n<th scope=\"col\">Contribution of the Employer<\/th>\n<\/tr>\n<\/thead>\n<tbody>\n<tr class=\"odd\">\n<th scope=\"row\">Hourly wage (blue collar)<\/th>\n<td>18.12 %<\/td>\n<td>21.03 %<\/td>\n<\/tr>\n<tr class=\"even\">\n<th scope=\"row\">Salary (white collar)<\/th>\n<td>18.12 %<\/td>\n<td>21.03 %<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/div>\nThe maximum monthly assessment base (<em>H\u00f6chstbeitragsgrundlage<\/em>) is \u20ac 5,850 (2023).\n\n<\/div>\n<div id=\"text_accounting_principles_reporting_requirements\">\n<h3>Accounting principles \/ Reporting requirements<\/h3>\nAccounting principles under tax law expand on the general bookkeeping obligations (<em>Buchf\u00fchrungspflicht<\/em>) set forth by commercial law (<em>Unternehmensgesetz<\/em>). Therefore, all taxpayers who are obliged to keep accounts under commercial law are also obliged to keep accounts for tax purposes.\n\nIn<strong>\u00a0corporations,<\/strong>\u00a0account records must be kept in accordance with general accounting principles. The same applies to\u00a0<strong>sole proprietors and partnerships<\/strong>\u00a0with\u00a0<strong>an annual profit of more than \u20ac 700,000.<\/strong>\n\nAll companies that are\u00a0<strong>not subject to the general accounting<\/strong>\u00a0<strong>obligations<\/strong>\u00a0can either prepare a\u00a0<strong>statement of income and expenses<\/strong>\u00a0(<em>Einnahmen-Ausgabenrechnung<\/em>) or\u00a0<strong>opt for lump sum taxation<\/strong>\u00a0(<em>Pauschalierung<\/em>).\n\n<\/div>\n<div id=\"text_austrian_business_culture\">\n<h3>Austrian business culture<\/h3>\nThe business culture in Austria at a glance:\n\nA\u00a0<strong>typical working<\/strong>\u00a0<strong>day<\/strong>\u00a0in Austria is from\u00a0<strong>8:00 am to 5:00 pm<\/strong>.\n\nHierarchy and status are two important values in Austrian business culture. Make sure that you have any titles (professional, academic) you hold on your business card. When you meet business partners, you should always formally address them by their titles followed by their family names.\n\nIf you wish to establish a strong business relationship, punctuality is very important. You should arrive at meetings well prepared.\n\nWhen engaging in business small talk you should not mention the role of the Austrians in World War II and it is advisable not to talk about money or religion. Make yourself familiar with facts that distinguish Austria from Germany, because Austrians are proud of the unique features of their country. They think of themselves as a \u2018skiing nation\u2019 and are very proud of their successful skiers.\n\n<\/div>\nLast updated: 01. January 2023\n<p class=\"disclaimer\">While great care has been taken in compiling our data, we cannot accept responsibility for the accuracy of the information provided.\u00a0Should you have any further questions, please do not hesitate to contact us. We will support you, subject to our professional qualifications, at any time.<\/p>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t","protected":false},"excerpt":{"rendered":"<p>Doing Business in Austria Business Start-Ups Business Start-up Promotion Act (Neugr\u00fcndungsf\u00f6rderungs&shy;gesetz) If you intend to set up a company, you will be expected to pay various fees. However, if your business start-up meets a number of requirements set forth by what is known in Austria as the Neugr\u00fcndungsf\u00f6rderungsgesetz (which translates as Business Start-up Promotion Act), [&hellip;]<\/p>\n","protected":false},"author":5,"featured_media":0,"parent":0,"menu_order":0,"comment_status":"closed","ping_status":"closed","template":"","meta":{"_acf_changed":false,"footnotes":""},"class_list":["post-13959","page","type-page","status-publish","hentry"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v26.1 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Doing Business in Austria - Baldinger und Partner<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.bup.at\/en\/doing-business-in-austria-2\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Doing Business in Austria - Baldinger und Partner\" \/>\n<meta property=\"og:description\" content=\"Doing Business in Austria Business Start-Ups Business Start-up Promotion Act (Neugr\u00fcndungsf\u00f6rderungs&shy;gesetz) If you intend to set up a company, you will be expected to pay various fees. 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