Austrian companies are tax residents, therefore there is a tax exemption and tax credit mechanism in relation to the income of an Austrian company received in the form of dividends or capital gains, which makes the Austrian jurisdiction attractive for setting up a holding company. In addition, it is possible to use Austrian companies as an agent of the offshore principal (agency scheme).
Austria is not an offshore jurisdiction and an Austrian company is subject to tax on all of the company's worldwide profits. However, since all Austrian companies are tax residents, there is a tax and tax credit exemption mechanism in relation to the Austrian company's income received in the form of dividends or capital gains, which makes the Austrian jurisdiction attractive for setting up a holding company. In addition, it is possible to use Austrian companies as an agent of the offshore principal (agency scheme).
Benefits for registering a company in Austria:
* the possibility of using treaties for the avoidance of double taxation;
* prestigious European jurisdiction.
Disadvantages for registering a company in Austria:
* meetings of shareholders must be held annually in Austria, unless a different address is indicated in the articles of association;
* availability of third parties to information about the company (names of directors, shareholders, accounts payable, legal address, etc.).
Restrictions when registering an Austrian company:
* to carry out banking, insurance, reinsurance activities, as well as activities that have signs of an investment, mutual or venture fund, it is necessary to obtain a special license from the Ministry of Finance;
* restrictions on certain types of activities for which the state has a monopoly (television and radio broadcasting, import and production of tobacco products, gambling);
* the purchase of real estate by foreigners is possible only with the prior consent of state authorities.
Financial statements
* submission of annual financial statements is required, regardless of whether the company conducted any activity or not;
* if the company did not conduct any activity, then “zero” reporting is submitted; you do not need to submit annual reports;
* in some cases, the Limited Liability Company GmbH must undergo an audit if:
o the size of the company's assets exceeds EUR 2.5 million;
o the company's turnover is at least 300,000 EUR;
o the number of employees of the company exceeds 50 people.
Two of the following criteria must be met for at least 2 years:
* AG joint stock companies must undergo an annual audit and file a tax return, balance sheet and profit and loss account with the tax authorities within 6 months from the date of the end of the financial year;
* all documentation related to financial reporting must be kept in the registration office for at least 10 years from the date of registration of the company.
Organizational and legal forms of enterprises:
* Open Joint Stock Company (Aktiengesellschaft - AG)
* Limited Liability Company (Gesellschaftmit beschraenkter Haftung - GmbH)
* Partnership with unlimited liability (Offene Handelsgesellschaft (OHG) and Offene Erwerbsgesellschaft (OEG)
* Limited Liability Partnership (Kommanditgesellschaft (KG) and Kommanditerwerbsgesellschaft (KEG)
* Branch of a foreign company (Zweigniederlassung)
Company registration requirements:
* all Austrian companies are mandatory members of the Austrian Chamber of Commerce;
* The Chamber of Commerce does not maintain a commercial register of companies, this is done by the relevant courts;
* all companies incorporated in Austria must have a legal address in Austria;
* Limited liability company or GmbH is incorporated in accordance with the Law on Limited Liability Companies (GmbHG) of 1906 (as amended). Legally, the company begins its existence after registration in the commercial register, which is maintained by the commercial court of the land where the legal address of the company is located;
* the minimum authorized capital is 35,000 Euro. It must be fully signed by the shareholders and paid for at the time of registration with a cash contribution of at least 17,500 Euro;
* also, upon registration, you must pay 1% of the amount of the contributed capital in the form of a tax fee (Gesellschaftssteuer).
* Joint Stock Company or AG is incorporated under the Joint Stock Companies Act 1965. Legally, AG begins its existence by entering it in the commercial register. All AG founders must sign the memorandum of association of the company in the presence of a notary. For a public limited company (Aktiengesellschaft - AG) the minimum share capital is 70,000 Euro and must be fully subscribed by the shareholders. The minimum share per founder is 70 Euro. By the time of registration, half of the capital must be paid in cash;
* partnerships (OHG, OEG and KG, KEG) do not require authorized capital;
* a branch of a foreign company in Austria (Zweigniederlassung) does not require an authorized capital;
* to conduct trading activities, the company must obtain a license to conduct trading activities from the Chamber of Commerce. Obtaining a license is optional if the trading activity is carried out exclusively outside Austria.
Corporate legislation:
* General Civil Code of 1811;
* German Trade Code of 1897 with subsequent amendments and additions;
* Commercial Code (”Gewerbeordnung”);
* International Trade Act 1995 (”Aussenhandelsgesetz”).
The following countries have signed treaties for the avoidance of double taxation with Austria:
Australia, Argentina, Belgium, Bulgaria, Brazil, Great Britain, Hungary, Germany, Denmark, Israel, Indonesia, Ireland, Spain, Italy, Canada, Cyprus, China, Liechtenstein, Luxembourg, Malaysia, Malta, Netherlands, Norway, Pakistan, Poland, Portugal, Russia, Romania, Slovakia, Slovenia, USA, Thailand, Tunisia, Turkey, Philippines, Finland, France, Czech Republic, Switzerland, Sweden, Emirates, South Africa, South Korea, Japan.