Starting a Business in Austria
Any person can set up a limited company in Austria – and do so without any Austrian participation. But it has even more benefits:
- Limitation of liability of the shareholders with the amount of the share capital
- Only one person, who can at the same time be the company management and hold shares in the company, is sufficient.
- with less formalism than with a public limited company (AG)
How to set up a limited company
(GmbH) in Austria
STEP 0 Preparation
Contact an attorney to draw up the partnership agreement´.
Clarify the registered office of the company, names and the managing director and define which area of activity you wish to cover with your limited company.
Contact an Austrian bank to prepare the opening of an account.
STEP 1 Memorandum and cash contribution
The first thing you need is a signed memorandum (in the case of single-member companies: declaration of establishment).
You appoint a company management (through resolution by those holding the shares in the company, with notarisation).
You must make a cash contribution: Minimum share capital amount: 35,000 euros, of which at least 17,500 euros must be paid in cash.
Limited company (GmbH) with foundation privilege: initial contribution at least EUR 10,000, of which cash contribution at least EUR 5,000. After 10 years at the latest, you must also increase the cash contribution to EUR 17,500.
You open a business account and pay in the cash contribution.
STEP 2 Entry into the company register
You complete the application form and have it notarised by the company management.
- Notarized certified memorandum
Resolution regarding the appointment of the company management. (Not necessary if already included in the memorandum.)
Certified declaration of sample signature by the company management
Proof of the paying-in of the cash contribution
STEP 3 Business registration
As a rule, you need a business license for economic activity.
There are licensed, regulated and free trades. Whereas you only need to be over the age of 18 to carry out a free trade and produce an extract from your judicial record, the other types also require proof of qualification and/or experience.
: If you do not have the necessary qualifications or do not have a work permit for Austria, you can also recruit a "managing director under trade law" for at least 20 hours a week.
INVEST in AUSTRIA informs you about the necessary business registration.
STEP 4 Registration with the tax office and registering your employees
As a limited company (GmbH), you are subject to corporation tax and sales tax. For this, you need a tax number. You or your tax adviser can request this after your company has been entered in the companies register.
Do you employ people? You need to register them with the responsible social insurance institution before their first day of employment. This is usually done for you by your tax adviser.
Did you know...
More attractive participation options are planned for employees and investors.
...that initial capital of EUR 10,000, of which EUR 5,000 must be in cash, is sufficient?
One advantage of the subsidiary is that no minimum capital is required, in contrast to a limited company (GmbH). The holding of annual general meetings and the publication of own balance sheets are also not required. However, separate accounting must be kept for the branch.
All documents of the company have to be translated into German, as does the annual balance sheet. In addition, the subsidiary is not an independent legal entity but a "dependent branch": You conclude all contracts on behalf of the parent company, have all the direct rights and obligations and also need to keep accounts in Austria. Furthermore, with a subsidiary, liability lies with the foreign company.
How to set up a subsidiary in Austria
STEP 1 Resolution regarding the establishment
No independent legal entity but commercially independent and geographically separate business premises of the foreign company with independent organisation and management
The name of the company must include that of the foreign company.
Register the branch office in the Austrian commercial register.
A company with its registered office outside the EU/EEA must appoint a "permanent representative" domiciled in Austria.
STEP 2 Entry in the companies register
Application to the companies register court
Entry in the companies register with certified signature by the company management of the foreign company in the number authorised to represent the company
Current memorandum or articles of association of the foreign company as a certified copy and, if applicable, certified translation
Resolution by the foreign company regarding the setting up of the subsidiary
Proof of the legal existence of the foreign company (e.g. certified extract from the companies register or commercial register)
Proof that capital transfer tax has not been incurred or that it has been paid
Certified declarations of sample signature by all managing directors of the foreign company and, if applicable, the representative in Austria
Proof of the regular business activity in the home country (not necessary for companies domiciled in the EU)
STEP 3 Business registration
For a company to carry out operations in Austria, a registration of the business is usually required and this is issued by the relevant authorities.
There are licensed, regulated and free trades. Whereas you only need to be over the age of 18 to carry out a free trade and produce an extract from your judicial record, the other types also require proof of qualification and/or experience. Tip: If you do not have the necessary qualifications or do not have a work permit for Austria, you can also recruit a "managing director under trade law" for at least 20 hours a week.
Register the trade online via the Austrian trade information system ("Gewerbeinformationssystem Austria").
STEP 4 Registration with the tax office and registration of employees
An Austrian subsidiary needs a tax number.
There are double taxation agreements with most countries. They make it possible to fundamentally only pay tax on profits in the country where the company has its registered office.
Register your employees with the responsible social insurance institution.
Tips for the successful establishment and location of companies in Austria
Are you looking for the perfect location and the ideal legal form for your expansion? With a location in Austria, you not only open up new markets but also build networks in the heart of Europe and secure valuable know-how of domestic players and stakeholders for yourself. We support you in the preparation of your next entrepreneurial step – with the best tips for establishing your company in Austria.
Tip 1: Get an overview of the market
A good market overview concentrates on key factors: market size and potential, market trends and – very important – a detailed analysis of the competition. Other important questions that you should not forget: wage costs, real estate prices, running costs, industry clusters, available specialists and funding options.
Tip 2: Not without a strategy and a business plan
Those who venture a move to Austria not only need a good product and the desire for entrepreneurial growth: A business plan is also part of the tools for a successful project and offers the opportunity to convince potential investors. The basis for this is the specific consideration which business activities are planned in which scope at the new location: What will be implemented at the headquarters in the country of origin and what will be done in the new foreign subsidiary? How are sales, production, marketing as well as research and development structured? Our advice: View the expansion into Austria in a similar way to establishing a new company.
Tip 3: Clarify fiscal boundary conditions
Companies that operate in Austria are subject to uniform corporation tax throughout Austria. This will be gradually reduced to 23% by 2024 (1% from 1 January 2023, 1% from 1 January 2024). This equates to an annual tax relief volume of EUR 700 million. Charges such as trade tax, property tax or inheritance tax that are by all means common in other countries do not exist in Austria. In addition, profits received by a limited company (GmbH) from a subsidiary are entirely tax-free in Austria in certain circumstances.
Tip 4: Specifically select the location
Austria has 9 federal states with different industry focuses. INVEST in AUSTRIA supports you together with the regional agencies.
Tip 5: Ensure expert advice
Contact important stakeholders in a timely manner before your expansion and seek advice only from experts whose specialist know-how incorporates both Austria and your country of origin. Tax advisers, legal advisers or real estate advisers should at any rate also have expertise in the legal situation in your market of origin and be familiar with the respective specialist terminology. In this way, you can ensure a well-founded, objective and promising consultation. Also take note of specialist expressions specific to the country, such as in administrative law – sometimes you will require an experienced expert here to "translate" this.
Tip 6: Use e-government services
With the company service portal, Austria offers companies the possibility to do their administrative tasks very easily online. You can thus not only set up a business online, you can also complete forms digitally, move your location and deal with your finances. Registration and usage are each possible free of charge.
The ABA makes it easy
As experienced experts with an excellent knowledge of the market, we are on hand to assist you in every step of the establishment of your company in Austria and will network you with the right specialists.
Checklists for Starting a Business
Everything in view: With these checklists, you won't miss any important points on the way to your business in Austria.