Austria’s not just all picturesque mountains and shimmering lakes! It’s known for being one of Europe’s economic powers due to its established industrial sector. Being the fourth richest country in the EU, Austria’s high quality of life makes it a great choice for foreign investors.
While the Austrian market isn’t exactly new territory for foreign investments, the growth potential in their economy is huge! Not only are their banking, agriculture and transport sectors still growing, but the population also has above average purchasing power.
Statistics show that that 60% of Austria’s GDP comes from the banking sector whereas the cattle and dairy industries are famous for producing premium goods.
Austria’s tourist sector is also bursting with potential! Tourists from all over the world love traveling here to visit and appreciate the serene countryside or visit the classic cobbled lanes of Vienna.
Property development and real estate are just starting to bloom into another lucrative area where foreign investment really excels and provides profits.
Forms Of Companies In Austria
- GmbH – “Gesellschaft mit beschränkter Haftung” – Private Limited Liability Company
- Ag – “Aktiengesellschaft” – Public Limited Company
- KG – “Kommanditgesellschaft” – Limited Partnership
- OG – “offene Gesellschaft” – General Partnership
- Gen – “Genossenschaft” – Cooperative
- “eingetragenes Einzelunternehmen” – Sole Proprietorship
What is the difference between GmbH and Ag companies in Austria?
In Austria, the most common types of companies started by foreign investors are GmbH and Ag.
In the Austrian GmbH, the amount of their subscribed shares is the limit of each member’s liability. The minimum share investment is 35000 EUR, and the minimum to pay up is 17500 EUR. However, there is an option to register a privileged GmbH at a foundation. When choosing that option, your share capital will be 10000 EUR and the minimum to pay up is 5000 EUR in such case. This sort of privilege ends after 10 years.
The Austrian Ag must also have at least 1 shareholder, and the minimum share deposit is 70000 EUR. Management and supervisory boards are mandatory.
Fundamentals Of A Limited Liability Company
Corporate Tax in Austria
VAT in Austria
Fundamentals of limited liability companies in Austria
|Limited liability company||GmbH|
|Minimum Share capital||35000 EUR, min to pay 17500 EUR|
|Registered office required||Yes|
|Physical office required||No|
|Min. number of Shareholders||1|
|Min. number of Directors||1|
|Local Director required||No|
|Bank signatory must travel||Yes|
|Timescale for company formation||30 days|
|Timescale for bank account opening||7 day|
|Timescale for obtaining VAT number||7 days|
|Statutory audit requirements||Yes|
|Shelf companies available||Yes|
How can I set up my company in Austria?
Setting up a new firm outside of your area of comfort can seem difficult, but that’s why CompyCo is with you every step of the way.
Here’s how setting up a company in Austria works:
The first step is to request activity approval from the Commercial Registry in Austria as well as to come up with a company name. This name must be unique.
Second, you need to create a corporate bank account in Austria in order to pay the share capital. The corporate bank account requires you to visit Austria in person.
The bank will issue the share capital certificate.
Third, the share capital certificate and a Memorandum of Association (MOA) along with other incorporation documents, need to be submitted to the Register.
Although, a physical visit is needed for the bank account, the process can be speed up by purchasing the shelf company route. CompyCo’s team can assist you with the procedures for this option as well!
Foreign investors that are looking to enter European markets within reputable jurisdiction should head straight for Austria. Not only are the industries with the most growth also the ones that are essentials in the area, but the established infrastructure gives new companies a great foundation to build off of.
CompyCo assists businesses in setting up their operations with tailored solutions that are created with your business needs and the country in mind. With years of experience in company set up in Austria, CompyCo has built up a large network of experts that ensure a smooth setup process.
Our team is full of experienced professionals from the HR, incorporation, banking and taxation sectors, which is why their advice on the best way to approach the operation of your company is priceless.
By combining a case-by-case approach with an in-depth knowledge of Austrian business sectors, CompyCo stays committed to providing premium business solutions at minimal costs.
Bank Account Opening
Austrian banks are some of the most secure ones out there. While Austrian banks take documentation and due process very seriously, you can rest assured that all the transactions you make will be completely safeguarded. It’s essential that you open up a corporate bank account in a physical branch in Austria, so that you can make the payment for the share capital.
You should know that it is mandatory for the Austrian company to have local bank account, but it’s not just about the requirements you need to meet though. Maintaining a bank account in a country where your business is set up leads to ease of monetary logistics and efficiency.
Every bank has its own set of requirements, which may range from the type of business activity you’ll engage in, to your country of residence. However, there are certain requirements that are usually common among all financial institutions in Austria; these are:
- The Commercial Register approval for your business
- Unlimited by time power of attorney
- Your Proof of Appointment of Directors
In some circumstances, the requirements may be different, but you’ll have to consult our experts for Austria to find out more about that before you go ahead.
Need more information about opening a bank account? Head over here.
Accounting & Taxation
Here are a few accounting and taxation obligations to take into consideration:
- In Austria, the tax year corresponds to the calendar year.
- Financial statements including a profit and loss account, an annex and a balance sheet must be submitted to the company register every year.
- There’s a flat corporate income tax rate of 25% on all net income for tax residents in Austria.
- The standard VAT rate in Austria is 20%. Certain types of goods are exempt from VAT.
- Companies are issued a unique 9-digit VAT number beginning with the country code AT and ending with a letter.
How can you employ staff in Austria?
Starting a new business outside of your comfort zone isn’t always an easy process. It’s even tougher when you don’t speak the language because recruitment and hiring becomes a huge hurdle. Employment legislation and workplace cultures also vary from country to country. Working with an experienced professional in the field of global HR is your best bet!
Compyco assists you will all of your hiring and HR needs. Our HR executives are well-versed in the employment regulations in Austria as well as the labor market. This knowledge helps them find you competitive workers that are offered suitable salaries by local standards.
We take care of all employee contracts, screening processes, payroll and induction work for you!
We can also avoid local company registration if you only need to employ an Austrian citizen to work from home. It’s in our best interest to save your costs if that is possible.
Have any questions? Take a look at our HR services page for more information about our International HR services!