Starting a Business Abroad as an Expat: The Complete Guide to Entrepreneurship in Austria

Published on April 28, 2026 and written by Cyril Jarnias

Moving to Austria with the desire to launch your own project means enjoying a stable country, at the heart of Europe, with a solid economy, a strong culture of innovation, and one of the highest standards of living in the world. But it also means entering a highly structured regulatory environment, where the chosen legal form, type of residence permit, taxation, and social security must be considered together from the very start.

Why Austria attracts foreign entrepreneurs

Austria ticks nearly every box an international entrepreneur might look for: political stability, a robust economy, a predictable legal framework, and direct access to the European market. It is also a natural hub between Western Europe and Central and Eastern Europe, with the DACH region (Germany, Austria, Switzerland) serving as a test market of nearly 100 million consumers.

On a macroeconomic level, Austria stands out for:

The capital, Vienna, concentrates about a third of national GDP and a quarter of all jobs, hosts numerous international organizations (UN, OSCE, OPEC), and attracts both regional headquarters of multinationals and young tech startups. It is regularly ranked at the top of quality of life rankings.

For an expatriate, this combination—security, standard of living, dynamic startup ecosystem, competitive corporate taxation—makes it a particularly attractive place to do business.

Visas and residence permits: the gateway to entrepreneurship

Before even discussing legal form or business plan, one point is crucial: the right to reside and work. The rules are completely different depending on whether you are a citizen of the EU/EEA/Switzerland or a third-country national.

European expatriates: freedom of establishment, but formalities to follow

Citizens of the EU, EEA, and Switzerland can settle and work in Austria under the same conditions as nationals. They can start a business, engage in self-employment, or become employees without a specific visa.

After three months of presence, however, they must:

– register via a certificate of residence (Anmeldebescheinigung);

– have valid health insurance in Austria;

– provide proof of sufficient means of subsistence.

For company formation, the same rules apply as for an Austrian: choice of legal form, registration, obtaining a trade license where applicable, and tax and social security registration.

Third-country nationals: betting on the Red-White-Red Card

For non-European expatriates, access to entrepreneurship almost always requires obtaining a dedicated residence title. The central piece is the Red-White-Red Card, a residence and work permit based on a points system.

– the Red-White-Red Card for Start-up Founders;

– the Red-White-Red Card for Self-Employed Key Workers.

Other options are also available (residence permit for temporary self-employment, short-stay Business Visa, etc.), useful at different stages of the project.

The Red-White-Red Card for Start-up Founders

This permit targets founders of innovative startups, with a very structured approach:

– the project must be based on the development and market launch of innovative products, services, processes, or technologies;

– the founder must have a decisive influence on the management of the company;

– a coherent and detailed business plan is mandatory;

– the project must generate a significant macroeconomic benefit or high added value for the Austrian economy.

Financially, you must prove a minimum capital:

– at least €30,000 in share capital, with at least 50% in equity, according to some sources;

– other references cite €50,000 as an investment threshold for this type of visa, always with a minimum equity share.

The points system is decisive: you need to achieve at least 50 points out of a maximum of 85, based on four categories:

Some concrete benchmarks:

The card is initially issued for a maximum of 24 months. After two years of activity in line with the project, the holder can, under certain conditions, apply for a Red-White-Red Card Plus, which grants unrestricted access to the Austrian labor market.

The Red-White-Red Card for Self-Employed Key Workers

This variant targets self-employed individuals whose activity has a particularly significant economic impact. Financial requirements are higher:

– minimum investment of €100,000;

– creation or securing of jobs in Austria;

– transfer of new technologies or know-how.

It is more suited to “business investor” profiles or high-level experts able to demonstrate a structuring effect on the local economy.

Other residence permits useful for entrepreneurs

For shorter or preparatory stays:

There is also a residence permit for self-employment (beyond six months without permanent settlement), based on a specific service contract and genuine entrepreneurial risk, without integration into another company as an employee.

Application procedure and costs

Generally, the initial application for a Red-White-Red Card is made:

– in person, at the competent Austrian embassy or consulate in the country of origin or legal residence;

– or directly with the residence authority in Austria if the applicant is already legally present there.

The file is forwarded to the Public Employment Service (AMS), which assesses the macroeconomic benefit. This step takes approximately three weeks.

Fees for a Red-White-Red Card are broken down as follows:

In addition, there are D Visa fees (referenced around €150), as well as translation, legalization, or apostille costs for documents, which are often substantial.

Choosing the right legal form for your project

Once the immigration framework is clarified, the next step is to structure the business legally. This choice is decisive for taxation, liability, bank credibility, and fundraising ability.

Overview of the main structures in Austria

Austrian law offers a wide range of legal forms, including:

– sole proprietorship (Einzelunternehmen, EPU, e.U.);

– limited liability company (GmbH);

– joint-stock company (AG);

– Flexible Kapitalgesellschaft (FlexCo/FlexKapG);

– partnerships (OG, KG, stGes, GesbR);

– branch or subsidiary for foreign companies;

– private foundation (Privatstiftung), more asset-oriented than operational.

For an expatriate starting a business, the truly frequently used forms are the sole proprietorship, the GmbH, the FlexCo, the subsidiary of a foreign company, and, in some cases, an OG/KG.

The sole proprietorship: fast, simple, but risky

The sole proprietorship is the simplest and quickest to set up:

– no minimum capital requirement;

– a simple business registration (Gewerbeanmeldung) usually suffices, sometimes in under 24 hours;

– registration in the commercial register (Firmenbuch) is not systematically required.

On the flip side:

It is a suitable option:

– for freelancers, consultants, liberal professionals;

– for activities with low financial risk;

– for starting a project to test a market on a small scale.

Important for expatriates: foreign nationals must first have a residence permit authorizing self-employment before they can register a sole proprietorship.

The GmbH: the standard for SMEs and foreign investors

The Austrian limited liability company (GmbH) is the flagship form for SMEs and foreign establishments. It offers:

– a legal personality distinct from its shareholders;

– limited liability to the amount of contributions;

– a strong professional image, better bank credibility;

– the ability to welcome investors, hire employees, and grow.

Since 2024, capital requirements have been eased:

– minimum share capital: €10,000;

– at least €5,000 must be contributed in cash upon incorporation;

– the remainder can be contributed in cash or in kind (equipment, real estate, etc.).

In practical terms, creating a GmbH involves:

– drafting the articles of association (Gesellschaftsvertrag) in the form of an Austrian notarial deed;

– registration in the commercial register (Firmenbuch), which grants the company legal personality;

– appointment of at least one managing director (Geschäftsführer).

An important point for expatriates: at least one managing director must reside in the EEA or Switzerland. However, there is no nationality or residence requirement for shareholders.

From a tax perspective:

– the GmbH is subject to corporate income tax at the standard rate of 23% (reduced rate as of 2023–2024);

– distributed dividends are subject to a withholding tax (capital gains tax) of around 27.5%;

– the company must maintain double-entry bookkeeping according to Austrian standards (Austrian GAAP), file annual accounts with the commercial register, and undergo an audit if it exceeds certain size thresholds;

– a minimum corporate income tax is due even in loss-making years (€437.50 per quarter for a GmbH, i.e., €1,750 per year).

Incorporation costs (notary, registration, advisory) generally range between €1,500 and €3,000, but can rise to around €5,000 depending on complexity. You also need to add the cost of opening a professional bank account and recurring accounting and tax fees.

The FlexCo: the “startup-friendly” format

Since 2024, the Flexible Kapitalgesellschaft (FlexCo) offers an option tailored for startups and innovative SMEs, blending features of the GmbH and the joint-stock company:

The FlexCo is subject to corporate income tax, with a specific minimum tax (€500 per year). For an expatriate aiming for rapid growth, successive funding rounds, and an employee incentive plan, this is a particularly relevant structure.

Other forms: AG, partnerships, branches

The joint-stock company (AG) requires capital of €70,000, a heavier structure (supervisory board, mandatory audit, publication) and is suited to larger companies.

Partnerships (OG, KG, stGes, GesbR) are characterized by:

– no minimum capital;

– unlimited liability of certain partners (managers);

– taxation at the income tax level.

They are more commonly used for:

– associations of experts (lawyers, consultants);

– joint ventures;

– structures like GmbH & Co KG (GmbH as general partner, individuals as limited partners).

For foreign groups, two options dominate:

– an Austrian subsidiary, usually in the form of a GmbH, a legally independent entity;

– a branch office, simply an extension of a foreign company, without its own legal personality, required to comply with Austrian law and maintain separate accounting.

Creation steps: from business plan to VAT number

Regardless of the chosen form, Austria operates on a very procedural logic. The steps follow a sequence but can often be carried out in parallel, especially since many services are digitized.

1. Develop a solid business plan

For an expatriate, the business plan is not just a tool for the bank or investors; it is also a central document for:

– the visa application (Start-up Founder, Self-Employed Key Worker);

– certain public grants or incubation programs;

– the macroeconomic benefit assessment by the AMS.

It must cover: the essential aspects of the matter at hand, while taking into account different points of view and ensuring all relevant information is considered.

– market and competitive analysis within Austria (and possibly the DACH region);

– positioning and value proposition;

– go-to-market strategy;

– financing plan (capital, loans, potential grants);

– financial projections (P&L, cash flow, working capital requirements).

2. Choose the structure and set company parameters

This involves determining:

3. Draft and notarize the articles of association

For capital companies (GmbH, FlexCo, AG, SE), the articles of association must be established in the form of a notarial deed, which involves:

– engaging an Austrian notary;

– the possible use of a power of attorney if the founder is not present;

– since 2022, in many cases, a fully digital procedure (qualified electronic signature).

The articles of association must specify in particular:

– the name and registered office;

– the corporate purpose;

– the amount of capital and the distribution of shares;

– the organization of governing bodies (management, meetings);

– the rules for transferring shares.

4. Open a professional bank account and deposit the capital

Opening a bank account in Austria requires:

– presenting identity documents of shareholders and managing directors;

– providing the articles of association (or draft);

– indicating the registered office address;

– demonstrating the lawful origin of funds (anti-money laundering).

Once the account is opened, the share capital must be paid in (at least the minimum cash contribution). The bank then issues a deposit certificate, which is essential for registration in the Firmenbuch.

5. Registration in the commercial register (Firmenbuch)

The application for registration in the Firmenbuch is filed with the competent commercial court. It includes in particular:

Once the company is registered, it receives a registration number and acquires full legal capacity.

6. Obtain the trade license (Gewerbeberechtigung)

In Austria, many activities fall under the regime of “commercial professions” (Gewerbe). The company must then:

– submit a business registration to the district authority (Bezirkshauptmannschaft or Magistrat);

– for regulated trades (crafts, technical professions, health, safety, etc.), provide proof of professional qualification (diploma, experience, master craftsman certificate);

– appoint, if the manager is not qualified or does not have the right to work, a manager “under commercial law” (Gewerberechtlicher Geschäftsführer) employed at least 20 hours/week.

The cost for a “free” activity is around €47.30. The procedure for basic registration is free, but some trades require additional steps and specific insurance.

7. Tax and VAT registration

The company must then notify the Finanzamt (tax office):

– application for a tax number (Steuernummer);

– if necessary, VAT registration and obtaining a VAT identification number (UID-Nummer).

Declaratory obligations include:

– monthly or quarterly VAT returns, depending on turnover volume;

– an annual VAT return;

– an annual tax return package (corporate income tax or income tax).

8. Social security registration

For self-employed individuals and sole proprietors, affiliation is mainly with the Social Insurance Institute for Self-Employed (SVS), while employees are covered by the Austrian Health Insurance Fund (ÖGK) and other bodies.

For the SVS, some useful benchmarks:

Contributions are calculated on a provisional basis and then adjusted retroactively when the final tax assessment is available.

For companies employing staff, you must:

– declare each new hire to the social insurance institution before the first day of work;

– pay employer contributions (approximately 38% of gross salary) covering pension, health, unemployment, accident, etc.;

– comply with strict rules on working hours, vacation, maternity protection, etc.;

Taxation and accounting obligations: what the expatriate must anticipate

One of Austria’s advantages remains its relatively competitive corporate taxation within the EU, even if the overall burden (social contributions, VAT, personal taxation) requires careful planning.

Corporate income tax and dividend taxation

Capital companies (GmbH, FlexCo, AG, SE) are taxed:

– at the corporate income tax rate standard of 23%;

– with a minimum annual tax (€1,750 for a GmbH, €3,500 for an AG, €500 for a FlexCo).

In the event of profit distribution, shareholders are subject to a capital gains tax (withholding tax) of approximately 27.5%. Double taxation treaties signed by Austria with many countries help limit international double taxation.

Income tax for sole proprietors

Sole proprietorships and partners in partnerships are subject to income tax, with a progressive rate ranging from 0% to 55%. For 2025, only income above €13,308 is taxable, with an average rate for many freelancers around 25%, depending on deductions.

VAT: rules and thresholds to know

The standard VAT rate is 20%, with reduced rates of 10% and 13% for certain goods and services (tourism, food, culture, etc.).

The “small business” scheme:

– exempts from VAT businesses whose annual turnover remains below a threshold (€35,000 gross, then €55,000 as of 2025);

– exempts from VAT registration and declaration, but prevents recovery of VAT on purchases.

Companies must maintain sufficient accounting records to:

– prepare monthly or quarterly VAT returns;

– produce an annual VAT return;

– retain supporting documents for at least seven years (longer for certain real estate).

Accounting and legal filings

Companies (GmbH, FlexCo, AG, etc.) must:

– maintain double-entry bookkeeping;

– prepare annual financial statements within five months of the year-end;

– hold a general meeting within eight months;

– file accounts with the commercial register no later than the ninth month.

The size of the company determines the extent of obligations (statutory audit, publication, etc.). Sole proprietors have lighter requirements but are still required to keep clear accounts and retain supporting documents.

Social protection for the self-employed and founders

The Austrian social security system is based on compulsory insurance and the principle of solidarity. For the self-employed, it is structured around the SVS.

Basic coverage for the self-employed

Compulsory insurance includes:

– pension (retirement);

– health insurance;

– accident insurance;

– a supplementary pension provision.

Contributions, calculated on professional income, are billed quarterly and adjusted after tax reconciliation. In case of low income, it is possible to apply for a partial exemption from certain contributions, within strict limits.

Benefits include:

Voluntary unemployment insurance options exist, but are not automatic for the self-employed.

Special cases: artists and creative professions

Self-employed artists and cultural workers can obtain specific support through the Artists’ Social Insurance Fund (KSVF), which can subsidize part of SVS contributions, subject to conditions of minimum artistic income and overall income cap.

This scheme illustrates Austria’s effort to adapt social protection to new forms of self-employment, even if the administrative complexity remains a challenge for expatriates.

Public support, financing, and the startup ecosystem

One of Austria’s major assets for an expatriate entrepreneur is the density of public support for business creation, innovation, and R&D.

Key players in financing and support

Several key institutions play a structuring role:

The funding landscape includes:

– non-repayable grants;

– subsidized loans;

– state guarantees covering up to 80% of a bank loan;

– tax incentives (notably a “research premium” of 14% of R&D expenses, with no cap);

– venture capital and business angels, particularly active in tech sectors (FinTech, PropTech, MedTech, etc.);

Example of some programs

To illustrate the breadth of possibilities, a few emblematic schemes:

To benefit, several criteria frequently recur:

– innovative and differentiating character of the project;

– growth and employment potential;

– quality of the team and its execution;

– plausibility of the business model.

The startup environment: dynamic and well-structured

With several unicorns and numerous identified “soonicorns,” Austria is now positioning itself as a serious player on the European startup scene. Vienna concentrates accelerators, coworking spaces, university incubators (INiTS, for example), venture capital funds (like Speedinvest), and a strong community of events and meetups.

For an expatriate, this ecosystem enables: developing professional relationships, integrating into the local culture, and accessing resources and services tailored to their needs.

– find mentors and local partners;

– join structured programs (accelerators, incubators);

– access startup-specific funding;

– build a professional network essential in a culture where trust and introductions play a central role.

Austrian business culture: what an expatriate needs to understand

Beyond legal and tax rules, succeeding in Austria requires understanding certain cultural codes.

A formal and structured business culture

The Austrian professional world is characterized by:

– great importance placed on punctuality;

– a generally direct communication style, but within a very polite and respectful framework;

– systematic use of titles (Herr/Frau, Dr., Mag., etc.) in emails, on business cards, in greetings;

– meetings are prepared, with an agenda, few digressions, and strong respect for decisions made at a higher hierarchical level.

Emails are treated as official letters: formal salutation (“Sehr geehrte Damen und Herren”, “Sehr geehrter Herr…”), structured phrasing, closing formula (“Mit freundlichen Grüßen”).

The crucial role of networking

Business success largely depends on trust and reputation. Introductions through a trusted third party (chamber of commerce, lawyer, fellow entrepreneur) are a powerful accelerator.

Expatriates can rely on:

– Expat Centers (Vienna, Linz, Graz, Klagenfurt, Salzburg, Innsbruck);

– chambers of commerce and their sector networks;

– expatriate communities (InterNations, dedicated Facebook groups, etc.);

– professional associations (e.g., Female Founders, Professional Women’s Network Vienna, etc.).

Networking also takes place via digital platforms like LinkedIn or XING (very popular in the DACH region), but does not replace face-to-face meetings, which are particularly valued in Austria.

Daily life and integration

The concept of “Gemütlichkeit”—warmth, conviviality, shared comfort—permeates social life. In business, however, professional and private life are quite strictly separated: invitations home are rare at first, and business lunches or dinners remain formal.

Proficiency in German, even at an intermediate level, is often underestimated by expatriates. Yet it weighs heavily on:

– the ability to negotiate with non-English speaking partners;

– dealing with the administration, still largely German-speaking;

– integration into informal networks.

Integration programs also require minimum language levels (A1 then B1) for long-term residents, and access to citizenship is accelerated for those who reach level B2 and demonstrate “exceptional” integration.

Long-term: permanent residence and citizenship

Starting a business in Austria can be a springboard to a lasting settlement.

For most residence permits, a long-term pathway emerges:

Naturalization generally requires renunciation of original citizenship, with exceptions in some cases of major investments, but on a very discretionary basis.

Common mistakes of expatriates and best practices

Cross-referencing information from the Austrian ecosystem, three mistakes stand out among foreign entrepreneurs:

– underestimating administrative complexity, especially the combination of residence permit / legal form / trade licenses / social security;

– neglecting the importance of German, at least for administrative aspects and long-term trust-based relationships;

– choosing an unsuitable legal structure (sole proprietorship when a GmbH is preferable) and having to convert it later at great expense.

A few best practices emerge in response:

Conclusion: Austria, a demanding but fertile ground for expatriate entrepreneurs

Starting a business in Austria as an expatriate is not simply a matter of completing a few formalities and then “getting started.” It is a project that must be thought of as a coherent whole:

– a life project (lasting settlement, cultural integration, family);

– a legal project (choosing the right vehicle: sole proprietorship, GmbH, FlexCo, subsidiary);

– a migration project (Red-White-Red Card, long-term residence, possibly citizenship);

– an economic project (business plan, financing, public support, R&D, recruiting).

In return, the country expects founders to fully play the game: real innovation, tangible economic benefit, strict compliance with rules, and personal investment in integration. For the expatriate who accepts this implicit contract, Austria can become much more than just a place to set up: a true entrepreneurial “home base” at the heart of Europe.

Cyril Jarnias

Cyril Jarnias is an independent expert in international wealth management with over 20 years of experience. As an expatriate himself, he is dedicated to helping individuals and business leaders build, protect, and pass on their wealth with complete peace of mind.

On his website, cyriljarnias.com, he shares his expertise on international real estate, offshore company formation, and expatriation.

Thanks to his expertise, he offers sound advice to optimize his clients' wealth management. Cyril Jarnias is also recognized for his appearances in many prestigious media outlets such as BFM Business, les Français de l’étranger, Le Figaro, Les Echos, and Mieux vivre votre argent, where he shares his knowledge and know-how in wealth management.

Find me on social media: