Austria consistently ranks high in GDP per capita due to its highly industrialized economy and well-developed social market economy. It is also a member of the EU. Thousands of people choose to migrate to Austria and start their own businesses as self-employed. This article is meant to help you do it.
Disclaimer: Be aware that this article is not a substitute for legal advice. Please always check official websites or seek legal advice before you take action.
What does "self-employment" mean in Austria?
In Austria, there is not one general category of self-employment; in fact, it's rather complex. According to laws of social insurance, self-employed persons fall under four categories. In Austria, you can be self-employed as:
- A new self-employed (Neue Selbständige)
- A liberal professional (Freiberufler)
- A self-employed with a free or regulated business license (Freie/ Reglementierte Gewerbe)
- An independent contractor (Freie Dienstnehmer)
Different laws and costs apply to each category. In this article, we will focus on the process of becoming a new self-employed- Neue Selbständige.
New self-employment- Neue Selbständige
Trade regulations do not apply to new self-employed, and a business license is not mandatory for this category.
New self-employed are not considered members of WKO, the Chamber of Commerce in Austria, and hence no membership fee applies. New self-employed are professionals registered at the Tax Office (Finanzamt), and the annual income tax return is applicable to them.
Another obligation is insurance contribution with the SVS, and its cost depends on the business's gross income. In some cases, insurance contributions can be voluntary (usually for pension and health insurance). It is an attractive factor when choosing a type of your business.
VAT registration is not obligatory if the annual gross income is under EUR 35,000 since it is considered a small business.
Some of the professionals that fall under the new self-employed in Austria include: artists, writers, journalists, lecturers, (self-employed) nurses, midwives, scientists, self-employed psychologists, and therapists.
Here are the general characteristics of the Neue Selbständige (new self-employed) in Austria:
- Self-employed who mostly use their own operating resources
- Managing partners of a limited liability company (called GmbH) if the employer does not insure them
- Limited working partners
- Individuals with work contracts who are not members of the Austrian Chamber of Commerce- WKO (service has been agreed for work contracts)
- Personally liable partners of partnerships
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Registration of the new self-employed (Neue Selbständige) in Austria
The moment of starting your business as a new self-employed is tied to the official starting date of your self-employed trade. You are required to register your individual trade by certain deadlines. The deadline for registration is four weeks from starting the professional activity.
It is recommended to do it earlier, but it's best to do so right away because some steps during the process (such as getting a FinanzOnline account, mobile phone signature, etc.) can take time. Failing to meet the deadline can cause penalties, so it's better to start the process as early as possible.
Registering with the Austrian authorities: Tax office
Note that there is more than one way to register your business, but we find this one the easiest and fastest. Follow these steps, and you'll get registered in no time.
Step 1
Open FinanzOnline account, which is the official portal of the Austrian Tax Office. Fill in all the required information, and you will receive the access data (your Login, PIN, and password) by mail in about ten weekdays.
Step 2
Once you have the log in information, submit a request to get your tax number on FinanzOnline. If you already have a tax number, you should go to the category More services ("Weitere Services") and choose Explanation of change ("Erklärungswechsel "- this form applies only if you earn income from self-employment).
When filling out the following form, you want to pay attention to these fields mostly: estimated annual turnover in the following year, estimated profit in the opening year, estimated profit in the following year. Make sure that all the other personal data you provide is correct to avoid delays and potential issues.
Step 3
If you don't have a tax number in the first place (and if you have never filed a tax declaration in Austria before), then you need to request the tax number by clicking on More services ("Weitere Services") and Tax number request ("Anforderung Steuernummer").
Step 4
If you have filed a voluntary tax return before ("Freiwillige Arbeitnehmerveranlagung"), a tax number has already been assigned to you and; since the tax number doesn't change, use that one for your registration.
It takes about 5-10 business days for FinanzOnline to process your request, so if you don't hear from them after ten days, contact your tax office and ask if there is any other information of documents you should submit.
Obtaining a mobile phone signature (Handy-Signatur) in Austria
Having a mobile phone signature streamlines and speeds up many operational tasks. You can use the mobile signature to sign documents, access your SVS Online account, and register at USP Portal for entrepreneurs.
By now, you probably have an account on FinanzOnline, so the mobile signature application is simple. Head over to "Aktivierung Handy-Signatur" (Mobile Signature Activation) and follow the steps. Once the mobile signature is ready, you will receive the activation confirmation by mail to the address you provided on the portal.
Social insurance registeration at the SVS (Sozialversicherungsanstalt der Selbständigen)
The institution responsible for handling social contributions for the self-employed in Austria is call Sozialversicherungsanstalt der Selbständigen, or SVS, for short. You can register at SVS in several ways:
- by filling in the application form online and sending it by mail to SVS
- by filling in the application form electronically and emailing it to SVS.
Here you can find the application form.
You can decide what kind of insurance you want to get- just health insurance or accident insurance as well. Look for Versicherungsanmeldung für Gewerbetreibende, Neue Selbständige und Freiberufler.
It would be a good idea to create an online account on SVS as well, so you can manage your social contributions without the need to go in person.
Austrian Business Service Portal (Unternehmensserviceportal, USP)
To open a USP account, you will need to have a FinnazOnline account and a mobile signature in place. Having a USP account is a good idea since you can keep all your SVS records, e-bills and fill out various electronic forms. Having an SVS account is mandatory for some businesses, so it would be good to check for the requirements.
Here is the link to USP Portal.
Paying taxes as self-employed in Austria
If your annual income exceeds EUR 11,693, you need to submit your business for a tax declaration. In some special cases, the tax office may require you to have a tax declaration even if your annual income is lower. You can check the requirements and the tax declarations you need to submit on your FinanzOnline account.
Tax declaration submission deadlines:
Tax declarations need to be submitted in the year following the one you're reporting on. For example, your tax declarations for 2022 need to be submitted by the end of June 2023 for online submissions via FinanzOnline.
You can submit a tax declaration in two ways:
- Via FinanzOnline - log into your FinanzOnline account, then chose category "Eingaben" on the top and then "Erklärungen"
- Trough accounting software in XML format (some software automatically directs the declarations to FinanzOnline, such as BMD/NTCS or Prosaldo)
For more information about taxes, please check this link.
