How to Start a Sole Proprietorship (OSVČ) in Austria

Operating as a self-employed individual (Einzelunternehmer) in Austria is becoming increasingly attractive for Czech entrepreneurs – whether they are tradespeople, IT specialists, or service providers. The Austrian market is stable, well-regulated, and full of opportunities. At the same time, however, it requires strict compliance with clearly defined legal and administrative rules.

In this article, you will learn what options are available to you as a sole trader (OSVČ), what obligations you must meet, and what to be cautious about if you are considering expanding your business to Austria and want to operate there legally.

Establishing a Sole Proprietorship in Austria

To legally operate in Austria as a Czech sole trader, you must first register your trade with the competent trade authority (Gewerbebehörde). Upon registration and submission of the required documentation, you will be issued a trade licence (Gewerbeschein), authorising you to carry out business activities.

As a Czech citizen, you will need the following documents for trade registration:

• A valid passport or national ID card
• Proof of permanent residence in Austria, or a criminal record extract (if you do not reside in Austria or have lived there for less than five years)
• A certificate of professional qualification (required for regulated trades – reglementierte Gewerbe)

Tax Registration and Obligations for Sole Traders in Austria

Once you obtain your Gewerbeschein, you must register with the competent tax authority (Finanzamt), where you will be issued a tax identification number (Steuernummer). This number is essential for income tax filing and VAT reporting.

Like in the Czech Republic, self-employment in Austria entails tax obligations. Sole traders are required to pay personal income tax (Einkommensteuer), which in Austria is progressive. The higher your income, the higher the rate of tax.

For the 2025 tax year, the applicable tax rates are as follows:

• Income up to €13,308: 0%
• Up to €21,617: 20%
• Up to €35,863: 30%
• Up to €69,166: 40%
• Up to €103,072: 48%
• Up to €1,000,000: 50%
• Over €1,000,000: 55%

If your annual turnover exceeds €35,000, you must also register for VAT (Umsatzsteuer). The standard VAT rate in Austria is 20%, while selected goods and services are subject to reduced rates of 10% or 13%.

Health and Social Insurance Contributions for Sole Traders

Self-employed individuals must register with the Social Insurance Institution for the Self-Employed (Sozialversicherungsanstalt der Selbständigen – SVS). Contributions include health insurance, pension insurance, accident insurance, and mandatory retirement savings (Selbständigenvorsorge).

During the first three years of business, insurance contributions are calculated based on a minimum assessment base. The minimum combined monthly contribution for health and pension insurance is 551,1 eur.

After three years, contributions are recalculated based on your actual taxable income and may increase or decrease accordingly.

Contribution rates are as follows:

• Pension insurance: 18.5% of the tax base for tradespeople (Gewerbetreibende), 20% for liberal professions (freie Berufe)
• Health insurance: 6.8% of the tax base
• Accident insurance: Fixed at €12.08 per month
• Mandatory retirement savings: 1.53% of the tax base

Mandatory Membership in the Austrian Economic Chamber (Wirtschaftskammer)

All sole traders are legally required to register with the Austrian Economic Chamber (Wirtschaftskammer Österreich – WKO). Chamber membership is mandatory and includes an annual membership fee. For sole traders, the minimum contribution is approximately 100 EUR per year.

In return, the Chamber provides a wide range of services and benefits:

• Legal, tax, and labour law advisory
• Social security guidance
• Training courses, seminars, and workshops
• Networking events and trade fairs
• Support for internationalisation and export activities

Operating in Austria with a Czech Trade Licence

Can you legally provide services in Austria using your Czech trade licence? Yes—under certain conditions. Czech-licensed sole traders may operate in Austria temporarily and occasionally under the principle of cross-border service provision within the EU.

This is permitted only if:

• Your primary residence, family, and centre of economic interest remain in the Czech Republic
• Your activity in Austria is temporary, irregular or occasional
• The service falls within a field in which you are authorised to operate in your home country

In such cases, you are required to notify the Austrian authorities in advance. This is known as a notification of temporary cross-border service provision (Anzeige einer grenzüberschreitenden Tätigkeit), and it must be completed before starting any business activity in Austria. Notification can be submitted via the Austrian Ministry of Labour and Economy’s website or the competent Gewerbebehörde.

If you operate temporarily in Austria, you may remain covered by the Czech social security system, but you must obtain a valid A1 certificate, confirming your insurance status in the Czech Republic. Public health insurance coverage is proven by presenting the European Health Insurance Card (EHIC), issued by your Czech health insurance provider.

Common Mistakes and Practical Recommendations

Czech sole traders often encounter difficulties when starting business activities in Austria. The following are some of the most common errors:

• Failure to notify Austrian authorities: Many mistakenly believe a foreign licence alone is sufficient. In cross-border cases, a formal Anzeige is required—failure to comply may result in substantial fines.
• Missing A1 certificate: Working in Austria without a valid A1 form is considered illegal. Austrian labour inspections frequently require this document.
• Ignoring mandatory WKO membership: Some are unaware that joining the Wirtschaftskammer is compulsory. Failure to pay the required contributions may lead to penalties and exclusion from support services.
• Non-compliant accounting and invoicing: Austrian regulations impose strict rules regarding invoice content, language, and VAT formatting.
• Underestimating SVS insurance contributions: Contributions are based on profit—even retrospectively—and minimum payments apply even with low income. Late registration may result in arrears and penalties.

To avoid these issues, we strongly recommend consulting with a legal or tax advisor experienced in cross-border business operations before launching your activities in Austria. Proper planning can save you time, money, and legal complications in the future.

Members of our Chamber are entitled to a free consultation on these matters.

Conclusion

Doing business abroad as a sole trader involves a set of legal, tax, and insurance obligations that differ from the Czech system. Start by determining whether your activity in Austria will be temporary and cross-border, or long-term, requiring full registration.

If your services are short-term and irregular, make sure to file a cross-border notification (Anzeige) and obtain an A1 certificate confirming Czech social insurance coverage. For long-term business activities, you must register your trade locally, register with the SVS, join the WKO, pay Austrian taxes, and comply with local bookkeeping rules.

Planning to expand your business to Austria?