Austria – Self-Employment

How does self-employment work for expats in Austria?

Anyone wishing to work in Austria — including on a freelance or self-employed basis — must first hold valid residency rights. This is a non-negotiable prerequisite that must be satisfied before any other registration step is taken. The conditions require either citizenship of an EU member state or a country party to the EEA agreement, or the possession of a residence permit that explicitly authorises the intended self-employed activity.

Self-employment in Austria is divided into two principal legal categories: Gewerbe (Trade) and Neue Selbständigkeit (New Self-Employment). This distinction is more formalised than the straightforward sole trader/freelancer split found in many other countries, and it determines which registration procedures and social security rules will apply to your situation.

Gewerbe covers occupations that must be officially registered with the Wirtschaftskammer Österreich (WKO — the Austrian Chamber of Commerce). It can be broken down further into regulated trades, which require evidence of relevant qualifications, and unregulated trades (freie Gewerbe). Neue Selbständigkeit, on the other hand, encompasses professions that do not require a Gewerbe registration but that must nonetheless be declared for tax and social security purposes. This category generally applies to knowledge-based and creative professionals — IT consultants, writers, coaches, trainers, and similar roles.

For expats, you must either hold EU or EEA citizenship or already possess a residence permit authorising self-employment — which can complicate matters for some arrivals. Third-country nationals who do not yet have residency in Austria must obtain a suitable permit before commencing any self-employed activity. The Red-White-Red Card system (discussed below) is the primary route available to those arriving from outside the EU/EEA.

What are the different self-employment and business structures available in Austria?

Austria provides a variety of legal structures for independent workers and business founders, ranging from the most straightforward sole proprietorship through to a publicly listed joint-stock company. The appropriate choice will depend on the nature of your activity, your anticipated income, your tolerance for personal liability, and your longer-term growth ambitions.

Einzelunternehmer (Sole Trader / Sole Proprietorship)
The sole trader form is the simplest way for a natural person to conduct business in Austria. There are no share capital requirements, although you will need to register your trading name with the Companies Register and obtain any required licences from the relevant authorities. As with comparable arrangements in other jurisdictions — such as sole trader registration in Ireland or the auto-entrepreneur status in France — you carry full personal liability for all business obligations and debts.

GmbH (Gesellschaft mit beschränkter Haftung — Limited Liability Company)
The GmbH is the Austrian equivalent of a private limited company. It operates as a distinct legal entity with limited liability, subject to corporate tax at a flat rate of 23% on profits (as of 2024), and allows for a complete separation of business and personal finances. A GmbH requires minimum capital of €10,000 (reduced from €35,000 with effect from 1 January 2024), with at least €5,000 (50%) deposited at the point of incorporation — a reform introduced under the 2023 Corporate Law Amendment Act that has made Austria considerably more accessible for startups and smaller businesses.

FlexCo (Flexible Kapitalgesellschaft)
The FlexCo is a new startup-oriented entity type that came into effect on 1 January 2024. Designed to create an internationally competitive corporate form, this flexible company structure opens up new financing options, including conditional capital increases. In contrast to the GmbH — where written shareholder decisions require unanimous consent — a FlexCo permits the articles of association to specify that unanimous agreement is not necessary for a written resolution, and that decisions may be passed by a majority via straightforward email exchange. This makes it especially well-suited to startups with multiple investors or employee equity participation arrangements.

AG (Aktiengesellschaft — Public Joint-Stock Company)
An AG requires minimum capital of €70,000, with at least 25% contributed prior to registration. This structure is suited to larger enterprises that plan to raise capital through public markets or that require more formal governance structures.

Partnerships
Austria offers four types of partnership available to foreign investors. Regardless of the type chosen, a minimum of two founding members is required, and there are no share capital obligations. Partnerships function well for professionals working in collaboration — comparable to a general partnership or LLP in other European countries — but the partners typically carry personal liability, which makes the GmbH or FlexCo a more popular choice among expat founders seeking liability protection.

How do you register as self-employed in Austria?

In Austria, a trade permit issued by the trade authority (district commission or municipal authority) is required for any commercial activity. The precise process differs slightly depending on whether your activity is classified as a Gewerbe or Neue Selbständigkeit, but the central steps are as set out below. Always verify current fees and processing timeframes with the relevant authority, as these are subject to periodic change.

1. Confirm your residency status and right to work. Before beginning any self-employed activity, you must verify that you hold a valid work visa or residency entitlement in Austria. EU/EEA citizens may proceed directly; third-country nationals must first obtain the appropriate Red-White-Red Card.
2. Determine your self-employment category. Not every freelancer requires a Gewerbe (trade licence), but certain professions do. Establish whether your activity falls under a regulated trade (requiring proof of qualifications), a free (unregulated) trade, or the Neue Selbständigkeit category. The WKO’s Gründerservice (start-up service) offers free initial guidance.
3. Register your trade with the trade authority (if applicable). To operate legally as a sole trader, you must register with the competent trade authority (Gewerbebehörde). Once you have submitted the required documentation and completed registration, a trade licence (Gewerbeschein) will be issued, authorising you to conduct your business activities. Registration may also be completed online through the Business Service Portal (USP).
4. Register with the Tax Office (Finanzamt) and obtain a tax number. Within one month of commencing your activity, you must apply for a tax number (Steuernummer) from the Finanzamt. Once your Gewerbeschein has been issued, you register with the relevant tax authority, which will assign you a tax identification number. This number is indispensable for income tax filings and VAT reporting.
5. Register with social insurance (SVS). If your income surpasses the applicable threshold, you must enrol in Austria’s self-employed social insurance scheme (SVS — Sozialversicherungsanstalt der Selbständigen). As of 2025, net annual income exceeding €6,010.92 triggers mandatory SVS registration and the payment of contributions covering health, pension, and accident insurance.
6. Register for VAT (if applicable). From 1 January 2025, the annual turnover threshold for Austria’s small business VAT exemption (Kleinunternehmerregelung) stands at €55,000. Freelancers with annual turnover below this figure qualify as Kleinunternehmer and are fully exempt from VAT: they neither charge VAT on invoices nor submit VAT returns. Should you exceed this threshold, VAT registration with the Finanzamt becomes mandatory.
7. Establish your record-keeping system. You are legally required to retain financial records — invoices and expense documentation — for a minimum of seven years. Most self-employed individuals in Austria use accounting software or retain the services of a Steuerberater (tax adviser) to manage this obligation.
8. File annual tax returns. Once your income exceeds the tax-free threshold, submit your annual tax return online through FinanzOnline. The filing deadline is generally 30 April of the following year for paper submissions, or 30 June for electronic filings.

Most of the initial administrative steps can be handled at your local Economic Chamber Office (WKO — Wirtschaftskammer). Registration fees vary according to activity category; consult the WKO website or your local district authority for current figures, as these are revised periodically.

How do you set up a company in Austria as an expat?

Foreign investors may fully own and operate a GmbH in Austria, with no restrictions on foreign shareholding. That said, foreign companies from non-EEA countries are required to appoint an Austrian-resident representative, and a GmbH must have at least one managing director — though no nationality requirement applies to that role. The steps below outline the process for establishing a GmbH or FlexCo, the structures most commonly favoured by expat founders.

1. Choose your company name and structure. Check that your preferred name is not already registered by searching the Firmenbuch (Commercial Register). Decide between the GmbH and FlexCo based on your financing requirements and governance preferences.
2. Draft the Articles of Association (Gesellschaftsvertrag). The founding contract must take the form of a notarial deed. Digital notarial services — including online authentication of founding documents and signatures — have lessened the requirement for founders to attend in person, which is a particular advantage for those based abroad.
3. Open a capital deposit bank account and deposit share capital. The required capital must be deposited into an Austrian bank account before registration can proceed. The bank issues a confirmation of deposit (Einzahlungsbestätigung), which is required for the notarisation of the incorporation documents. Austrian banks typically require in-person meetings for foreign-owned accounts, and account opening generally takes two to four weeks following submission of complete documentation (as of 2025).
4. Notarise and submit incorporation documents to the Firmenbuch. Lodge your documents with the competent commercial court covering your registered address. The court will review the form, compliance, signatures, and accompanying documentation. Once accepted, your company is formally registered, assigned a Firmenbuchnummer (commercial register number), and acquires legal personality. The register entry includes the legal name, address, share capital, and company officers.
5. Register with the tax office. Following company registration, apply to the local Finanzamt for a corporate tax number. Your VAT identification number (UID-Nummer) is typically assigned at the same stage.
6. Register with social security institutions (if employing staff). Register as an employer with the relevant social security bodies, including the Österreichische Gesundheitskasse (ÖGK) for health insurance, the Pensionsversicherungsanstalt for pension contributions, and the Allgemeine Unfallversicherungsanstalt for accident insurance.
7. Register your trade activity (if required). If your GmbH intends to carry out a licensed trade, you must also obtain a Gewerbeschein from the trade authority, in addition to registering with the Firmenbuch. Austria’s Business Service Portal (USP) facilitates faster processing, particularly for Firmenbuch registration and tax office registration, as a result of ongoing digitisation efforts (as of 2025).

Documentation requirements typically comprise notarised articles of association, a Commercial Register extract, identification for all managing directors and beneficial owners (those holding 25% or more), a business plan, evidence of a registered office address, and source of funds documentation. Always consult a local notary or legal adviser for current official fees and processing timelines, as these vary and are subject to revision. The official investment promotion agency Invest in Austria (ABA) provides free guidance specifically for foreign founders.

Can you work as a digital nomad in Austria?

Austria has not introduced a dedicated digital nomad visa. Nevertheless, the country offers a number of existing visa categories that may be appropriate for remote workers and entrepreneurs, including the Red-White-Red Card and the Start-up Founders Card. Unlike Portugal, Spain, or Croatia — which have each introduced tailored digital nomad visa schemes in recent years — Austria has not followed that path, meaning remote workers must navigate existing immigration routes.

EU, EEA, and Swiss nationals do not require a visa to enter Austria. They may reside as digital nomads for up to three months without restriction; those wishing to remain beyond that period must register their stay at a local registration office. For longer stays involving self-employed work, EU/EEA nationals should register with the relevant authorities and follow the standard self-employment registration process described above.

For nationals from outside the EU/EEA, citizens of many countries may enter Austria without a visa for tourism or business purposes for up to 90 days within any 180-day period. During this time, however, paid work or any form of remunerated activity is not permitted. Undertaking paid work under a tourist or Schengen entry is a legal grey area that can lead to visa complications and tax exposure — obtaining professional legal advice before pursuing this route is strongly recommended.

Among the more specialist visa options is the Red-White-Red Card for Start-Up Founders, which is intended for entrepreneurs who plan to establish a company in Austria engaged in the development of innovative products, services, or technologies with the potential to bring significant benefit to the Austrian economy. This long-term residence permit allows holders to live and work in Austria for up to two years, with the option of a further three-year extension.

Key eligibility requirements for the Red-White-Red Card for Start-Up Founders include: a thoroughly developed and credible business plan; a senior management position within the company with meaningful influence over its operations; a minimum capital investment of €50,000, with the applicant holding at least a 50% equity stake; and a score of at least 50 points on a scale measuring potential contribution to the economy (as of 2024/2025). Always verify the current points criteria and income thresholds with the Austrian Migration Portal, as requirements are subject to change.

Third-country nationals may also apply for a Red-White-Red Card for Self-Employed Key Workers, provided their self-employed activity in Austria generates macroeconomic benefit extending beyond the direct operational benefit of the business. Qualifying criteria include a sustained transfer of investment capital to Austria of at least €100,000, the creation of new jobs or preservation of existing ones, the transfer of know-how or introduction of new technologies, or a business of significant regional importance. The Red-White-Red Card is issued for 24 months and grants the holder fixed-term settlement rights and the right to pursue the self-employed activity described in the application.

What taxes and social contributions apply to self-employed expats and business owners in Austria?

Austria operates a progressive income tax system — the higher your earnings, the greater the percentage of tax you pay. As of 2025, income up to €13,308 is tax-free; from €13,308 to €21,617 the rate is 20%; from €21,617 to €35,836 it is 30%; from €35,836 to €69,166 it is 40%; from €69,166 to €103,072 it is 48%; from €103,072 to €1,000,000 it is 50%; and income above €1,000,000 is taxed at 55%. These bands apply to sole traders and freelancers operating under Neue Selbständigkeit. Unlike a standard employment arrangement where tax is automatically deducted from wages, self-employed individuals in Austria must handle their own quarterly advance payments and submit an annual return.

Companies structured as a GmbH or FlexCo are subject to corporate income tax at a flat rate of 23% on profits (as of 2024). The minimum corporate income tax for GmbH companies stands at €500 per year from 1 January 2024, regardless of whether the company is profitable — this minimum applies even where the company makes a loss or generates no revenue at all. This represents a substantial reduction from the previous minimum of €1,750.

VAT (Umsatzsteuer)
From 1 January 2025, the annual turnover threshold for Austria’s small business VAT exemption (Kleinunternehmerregelung) is €55,000. Freelancers below this threshold are entirely exempt from VAT and neither charge VAT on their invoices nor file VAT returns. The standard VAT rate is 20%, with reduced rates of 13% and 10% applying to certain categories of goods and services. For invoices issued to VAT-registered EU business clients, the reverse charge mechanism applies — you do not charge Austrian VAT; the client accounts for VAT in their own country instead.

Social Insurance (SVS)
Freelancers are required to contribute to Austria’s Social Insurance for the Self-Employed (SVS). Contribution rates comprise health insurance at 7.65% of income, pension insurance at 22.8% of income, and accident insurance at 1.2% of income. This structure differs fundamentally from employment-based contributions — unlike a salaried employee whose contributions are shared with an employer, the self-employed person is responsible for meeting the full cost of all contributions personally.

Tax treaties and double taxation
Austria maintains an extensive network of double taxation agreements covering more than 90 countries. For instance, a US-Austria totalisation agreement helps to prevent double social security taxation for American citizens. If you remain liable to tax in another country alongside Austria, specialist cross-border tax advice is strongly recommended. The Austrian Federal Ministry of Finance (BMF) and its FinanzOnline platform serve as the official points of contact for all tax matters.

Are there any incentives, grants, or programmes to encourage expat entrepreneurs in Austria?

In recent years, Austria has taken concrete action to reduce obstacles for foreign entrepreneurs and startup founders, primarily through far-reaching reforms to company law and the introduction of targeted visa pathways.

The Red-White-Red Card for Start-Up Founders
Non-EU, EEA, or Swiss citizens who have an innovative business concept and the necessary financial resources may apply for the Austrian Red-White-Red Card for Start-Up Founders. This card is specifically designed for entrepreneurs who intend to bring innovative products or services to market in Austria. It provides a clear legal pathway to residency that is directly linked to the business venture, making it one of the most practical routes available to non-European founders.

Reduced GmbH and FlexCo formation costs
From 1 January 2024, the minimum share capital required to form a GmbH was cut from €35,000 to €10,000, substantially lowering the entry barrier for new businesses. The FlexCo was also launched in January 2024 as a startup-friendly entity, and the minimum corporate income tax for GmbH companies was reduced to just €500 per year. These changes position Austria more competitively relative to other EU jurisdictions that have traditionally attracted startup founders.

R&D and investment incentives
The government implemented an eco-social tax reform that reduced the corporate income tax rate progressively — from 25% in 2022 to 24% in 2023 and then to 23% from January 2024 onwards. When investment allowances and R&D incentives are factored in, the effective tax burden falls to approximately 21.2%. Austria also operates one of Europe’s most generous research premium (Forschungsprämie) schemes, providing a 14% cash rebate on qualifying research and development expenditure. Current eligibility criteria can be verified with the Austrian Research Promotion Agency (FFG).

Free advisory services for founders
The Chambers of Commerce (WKO) deliver specialist guidance across Austria through their start-up service, covering everything from initial concept development through to finalising financing arrangements and addressing insurance questions. This service is free of charge and available in multiple languages at many locations. Most initial administrative formalities can be completed at your local WKO (Wirtschaftskammer) office. The Invest in Austria (ABA) agency additionally offers a free, English-language business set-up advisory service aimed specifically at international investors and entrepreneurs.

FlexCo and startup ecosystem support
A total of 82 FlexCo companies were incorporated in Austria during the first two months of 2024 alone, and by the end of May 2024, close to 400 flexible companies had been established — with the structure gaining rapid traction, particularly within Vienna’s startup ecosystem. Vienna itself boasts a well-developed network of accelerators, incubators, and coworking spaces, including Impact Hub Vienna and Talent Garden Vienna, which provide networking opportunities and mentoring support for founders at early stages of development.

What are the practical challenges of being self-employed or running a business in Austria?

Language
German is the sole official language of Austrian public administration, and the overwhelming majority of government forms, official correspondence, trade register entries, and legal documents are produced exclusively in German. While many officials and WKO advisers in cities such as Vienna speak English, all formal filings must generally be submitted in German. Foreign companies or legal entities participating in Austrian incorporation processes must demonstrate their legal existence by producing a confirmation from the competent court or chamber of commerce — and where this document is not in German, a certified translation is required. Budget for the costs of professional translation and legal review accordingly.

The role of professional advisers
Retaining a qualified Steuerberater (tax adviser / certified accountant) is not a legal obligation for sole traders, but in practice it is highly advisable. The Austrian tax system can be intricate to navigate, particularly for the self-employed. Whereas full-time employees have income tax automatically deducted at source by their employer, freelancers and business owners must take personal responsibility for managing all their tax obligations. A Steuerberater can also represent you before the Finanzamt and ensure that all legitimate deductions are claimed. For company formation, the engagement of a local notary is a legal requirement.

Banking access
Banks apply enhanced due diligence procedures for foreign-owned companies under anti-money laundering legislation. Documentation requirements include notarised articles of association, Commercial Register extracts, identification for all directors and beneficial owners, a business plan, evidence of a registered office address, and source of funds documentation. Delays may arise depending on the KYC (Know Your Customer) process, particularly where there are foreign shareholders. Allow additional time and consider engaging one of the major banks with established international business experience, such as Erste Bank, Raiffeisen Bank, or Bank Austria.

Invoicing requirements
Invoices must satisfy Austrian invoicing requirements, which include: the issuer’s full name and address, UID-Nummer (if VAT-registered), a sequential invoice number, the date, a description of the service rendered, the net amount, the applicable VAT rate and amount (or a Kleinunternehmer declaration), the gross total, and — for amounts exceeding €400 — the recipient’s details. Non-compliant invoices can attract penalties and result in the forfeiture of VAT input credit entitlements.

Record-keeping obligations
All financial records — invoices and expense documentation — must be retained for a minimum of seven years. Austria’s revenue authority scrutinises business expenses closely, particularly the use of vehicles for business purposes. A contemporaneous digital or paper log of every business journey — recording the date, destination, purpose, and distance covered — is essential both for claiming mileage deductions and for withstanding any tax audit (Betriebsprüfung).

Registered office and Chamber membership
Businesses must register with the Commercial Register, manage VAT obligations through the Federal Ministry of Finance’s FinanzOnline portal, and fulfil chamber membership requirements relevant to their sector. Most businesses operating under a Gewerbe are automatically enrolled as members of the WKO and are subject to an annual chamber levy (Grundumlage). This represents a fixed annual cost with no direct equivalent in many other European business frameworks, so it should be incorporated into your financial planning from the outset.

Frequently asked questions

Can I be employed and self-employed at the same time in Austria?

In principle, yes — it is legally permissible in Austria to hold salaried employment while simultaneously running a self-employed activity. However, if you hold a visa that is linked to full-time employment, there may be conditions attached that preclude you from undertaking freelance work for additional income, and your employer’s contract may also contain restrictions on secondary activities. Always review both your visa conditions and your employment contract thoroughly before commencing any additional self-employed work.

How do I invoice foreign clients from Austria?

On invoices issued to VAT-registered EU business clients, the reverse charge mechanism applies — you do not add Austrian VAT to your invoice; the client is responsible for accounting for VAT in their own country. For clients situated outside the EU, Austrian VAT generally does not apply to exported services. You are still required to include all mandatory invoice fields under Austrian law, and if you are VAT-registered, these transactions must be reported in your VAT returns. Engaging a Steuerberater with experience in cross-border matters is strongly advisable if you regularly invoice clients abroad.

What happens to my business status if my visa or residency status changes?

Your entitlement to work — including on a self-employed basis — is directly contingent on your residency status in Austria. If your residence permit expires, is not renewed, or changes to a category that does not authorise self-employment, you must discontinue your trading activity immediately. Neither your Gewerbeschein nor a company directorship independently preserves your right to work. Always ensure that your residency and business authorisations remain aligned and are renewed with sufficient lead time.

Is the Kleinunternehmer VAT exemption available to non-Austrian residents?

Since 2025, Austria participates in the EU SME VAT scheme, which allows EU businesses from other member states to benefit from the Austrian Kleinunternehmer exemption on their Austrian turnover (up to €55,000 in Austria; €100,000 across the EU as a whole). Conversely, Austrian Kleinunternehmer may apply their domestic exemption when providing services to other EU member states — provided their total EU-wide turnover remains below €100,000. Non-EU resident businesses supplying services in Austria may still be required to register for VAT regardless of their turnover level; confirm your specific position with the Finanzamt or a tax adviser.

Do I need a local resident director for my Austrian GmbH?

A GmbH must have at least one managing director, but no nationality restrictions apply to this role. However, foreign companies originating from non-EEA countries are required to appoint an Austrian-resident representative. For businesses owned entirely by non-EEA nationals who do not hold Austrian residency, appointing a locally resident managing director or representative is both practically sensible and may be a legal requirement depending on your specific structure. Always seek confirmation from a local lawyer.

How long does it take to set up a GmbH in Austria?

Austria has considerably streamlined the GmbH registration process through the digitisation of government services, encompassing name verification, submission of articles of association, Firmenbuch registration, and tax number issuance. Digital notarial services have reduced the need for physical presence, which is a particular benefit for foreign founders. The formal incorporation procedure at the commercial court can be completed in as little as one to two weeks once all documentation is in order, but bank account opening — which must precede registration — can add a further two to four weeks, especially for foreign-owned entities. In total, allow between four and eight weeks from start to completion.

What are the main social insurance costs for self-employed people in Austria?

Self-employed individuals are liable for health insurance at 7.65% of income, pension insurance at 22.8% of income, and accident insurance at 1.2% of income — a combined rate of approximately 31.5% for the principal contributions (as of 2024). Mandatory SVS registration is triggered once net annual income exceeds €6,010.92 (as of 2025). SVS contributions are calculated on the basis of provisionally assessed income derived from prior years, with a reconciliation payment or refund applied after your tax return is finalised. Always confirm current rates and thresholds at svs.at.

Are there free resources to help expats set up a business in Austria?

Comprehensive information and guidance on establishing a business in Austria is available at www.gruenderservice.at. The Chambers of Commerce (WKO) deliver expert support throughout Austria via their start-up service, spanning everything from the initial business idea through to financing structures and insurance-related questions. The Invest in Austria (ABA) agency provides a free, English-language advisory service tailored specifically to international founders and investors. The official Austrian Migration Portal at migration.gv.at contains detailed information on all available visa and residency pathways.