Company formation in Austria

Before deciding to set up a new company in Austria, read the information below to understand the characteristics of a Limited Liability Company (LLC) / Gesellschaft mit beschränkter Haftung (GmbH):

Shareholders: the company must have at least 1 natural or legal person. There are no residency requirements.

Director: GmbH is required to have at least one director and it can only be a natural person. Residency is not considered.

Company secretary: there is no requirement.

Minimum share capital: €35,000, 50% of which must be deposited in the local bank in cash before company registration in Austria.

Legal address: the company is obliged to have its address in Austria.

Liability: enables to limit the liability of participants for the company's debt obligations only to the amount of their investment in the company's capital.

Accounting: the company must prepare annual financial statements. It must be filed with the Commercial Register no later than 9 months after the end of the financial year. In addition, VAT-paying companies submit VAT returns.

• The standard rate of corporate income tax is 23% of taxable income, irrespective of the level of income.
• The minimum CIT rate for a GmbH is €500 for the first 5 years of the company's existence and €1,000 per year for the following 5 years.
• Corporations with management or a registered office in Austria are taxed with unlimited CIT.
• Corporations whose management and registered office are not located in Austria are subject to a limited income tax. The limited tax liability applies only to certain domestic income.
• CIT returns must be filed by 30 April of the following year or sent electronically via FinanzOnline by 30 June of the following year.

• All natural persons who are domiciled in Austria or for whom Austria is a regular place of residence are taxed with unlimited income tax (“unlimited" meaning that basically all their Austrian and foreign income is subject to income tax). Furthermore, even persons who are not domiciled in Austria can be taxed on certain income generated in Austria.
• EU/EEA citizens who are not domiciled in Austria may be subject to unlimited income tax if their main source of income is in Austria.
• The PIT rates are as follows:

- €12,816 and below - 0%

- above €12,816 up to €20,818 - 20%

- above €20,818 up to €34,513 - 30%

- above €34,513 up to €66,612 - 40%

- above €66,612 up to €99,266 - 48%

- above €99,266 up to €1,000,000 - 50%

- above €1,000,000 - 55%

• The standard tax rate of 20%.
• The reduced tax rates are 10% (renting for residential purposes, accommodation in furnished living rooms and bedrooms and the ancillary services often associated therewith (including heating), rental (provision for use) of land for camping purposes, rubbish collection, delivery of books / newspapers / magazines / foodstuffs) and 13% (the delivery of living animals / plants / firewood, turnover from the activity of an artist, film or circus performances, admission fees for sporting events).
• Enterprises that make VAT-taxable supplies and provide other services to customers and whose annual turnover exceeds €35,000 are generally required to file VAT returns.

Double taxation avoidance agreements in Austria: Albania, Algeria, Armenia, Argentina, Azerbaijan, Australia, Barbados, Bahrain, Belgium, Belize, Bosnia and Herzegovina, Brazil, Bulgaria, Canada, Chile, China, Croatia, Cuba, Cyprus, Czech Republic, Denmark, Egypt, Estonia, Finland, France, Germany, Georgia, Greece, Hong Kong, Hungary, Iceland, India, Indonesia, Iran, Ireland, Israel, Italy, Japan, Kazakhstan, Kyrgyzstan, Korea, Kosovo, Kuwait, Latvia, Libya, Liechtenstein, Lithuania, Luxembourg, Malaysia, Malta, Macedonia, Mexico, Morocco, Moldova, Mongolia, Montenegro, New Zealand, Nepal, Netherlands, Norway, Qatar, Pakistan, Philippines, Poland, Portugal, Romania, Russia (suspension of the double taxation agreement by Russia), San Marino, Saudi Arabia, Serbia, Singapore, Slovakia, Slovenia, Spain, South Africa, Sweden, Switzerland, Syria, Tajikistan, Taiwan, Thailand, Tunisia, Turkey, Turkmenistan, United Kingdom, Ukraine, United Arab Emirates, United States of America, Uzbekistan, Venezuela, Vietnam.