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EXPLAINED: How freelancers in Austria can pay four times less in social insurance

Self-employed people in Austria are insured by SVS and have to cover 20 percent of treatment costs. that can be reduced to 5 percent. Here's how.

Freelancers in Austria may be able to reduce their social insurance contributions. Here's how. Photo by Ewan Robertson on Unsplash
Freelancers in Austria may be able to reduce their social insurance contributions. Here's how. Photo by Ewan Robertson on Unsplash

Austria has a mandatory health and social insurance policy, which means that every resident needs to be insured.

EXPLAINED: What is it like being self-employed in Vienna?

Most people in Austria, 82 percent in total, are insured by ÖGK through their employers.

Self-employed workers, however, have to make their payments themselves with Sozialversicherung der Selbständigen, or SVS. 

Several differences come from this, the main one being that self-employed people need to register and make the payments by themselves, while employed workers will have their contributions automatically taken from salaries and paid for by employers.

READ MORE: Everything you need to know about becoming a freelancer in Austria

Another key distinction is that SVS will not cover 100 percent of costs when it comes to health treatments and doctor consults.

Self-employed people need to cover a 20 percent proportion of costs, the so-called Selbstbehalt. That means that if a doctor that works with the SVS insurer charges € 100 for his consultation, SVS will pay €80, and the rest, €20, will come via invoice for the self-employed person to pay for afterwards.

Bills rarely come this high, though. Even so, there is a way to reduce that co-pay rate to 5 percent.

The ‘healthy self-employed program’

SVS has a program to promote health that will let you cut the costs of payment, conditional to achieving specific health goals. 

Insured people can arrange these health goals with their doctors. The targets can be regarding blood pressure, weight, exercise, tobacco and alcohol consumption, according to SVS.

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After six months, you can arrange another consultation with the doctor to check on those goals. If you have met them, the doctor can sign off on reducing copayment costs from 20 percent to 10 percent.

After two to three years, another evaluation is necessary, and people who kept their achievements can co-payments to 5 percent. 

The rates can also be achieved by “fit” people as there can be “maintenance” goals.

Self-employed people can make an appointment at the SVS Health Centre in Vienna to agree on goals or go straight to their own family doctor. 

The My SVS website (you have to be logged in to access) has a PDF form with all the possible goals that can be agreed together with the doctor, including columns for the “current values”, a separate column for goals (including things such as “continue to be a non-smoker”), and a third column for the “after” evaluation. 

READ MORE: Everything you need to know about health insurance for freelancers in Austria

Useful links

SEA – The self-employed in Austria group supports self-employed individuals by delivering information in the form of guidebooks and free articles in English. 

SVS – The social insurance organisation for self-employed people in Austria.

WKO – The Austrian Chamber of Commerce is a useful source of information for self-employed people.

Useful vocabulary

Sozialversicherung – social insurance

Selbständigen – self-employed

Neue Selbständige – new self-employed

Steuer – tax

Gesundheitsversicherung – health insurance

Pensionsvorsorge  – pension provision

Unfallversicherung – accident insurance

Verwaltungskosten – administration costs

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Cost of living: Why are restaurants getting more expensive in Austria?

Austria's June inflation is expected to be 8.7 percent, according to calculations by Statistics Austria - a record high in the country.

Cost of living: Why are restaurants getting more expensive in Austria?

The inflation rate for June 2022 is expected to be 8.7 percent, the Statistics Austria institute calculated as part of a flash estimate.

Compared with the previous month, consumer prices rose by 1.4 percent, Statistics Austria said. This is the highest level since 1975 or almost 50 years.

The wave of inflation has affected mostly energy and food prices in Austria but has now also arrived in the gastronomy sector, with increasing costs in bars and restaurants in the country.

“Inflation has picked up speed in almost all areas. In addition to recent increases in fuel and heating oil prices, we also see significant increases in restaurant and food prices”, according to Statistics Austria Director-General Tobias Thomas.

READ ALSO: EXPLAINED: How Austria’s new finance measures could benefit you

The main culprits of rising food prices in retail and restaurants are the more costly energy and fuel prices. As transport and production become more expensive, these increases cascade to gastronomy as well.

Additionally, packaging and logistics costs have also increased, directly affecting food prices, the Handelsverband (trade association) said.

“The war in Ukraine and China’s zero-covid strategy continue to put a massive strain on global supply chains,” said Rainer Will, Managing Director of the Trade Association, in a press release.

“We do not expect inflation to peak until the end of the year.”

READ ALSO: The essential products that are getting more expensive in Austria

The association added that the Ukraine war also increased prices for agricultural raw materials and fertilisers, making food production and distribution more expensive.

What is next?

Rising costs have already reached other sectors, including rental prices, as The Local reported.

Austrian Post has also said that there will be price adjustments in the parcel sector “in the foreseeable future”, though they have added that these will be “very moderate”.

Criticism from the opposition

The SPÖ, FPÖ and the Neos accuse the government of doing too little against inflation.

“There is not even a draft law for the abolition of the cold progression,” criticised Neos economic and social spokesman Gerald Loacker. “The government’s one-off payments help little to nothing,” said SPÖ social spokesperson Josef Muchitsch.

READ ALSO: EXPLAINED: The main Austrian ‘tax traps’ foreigners should be aware of

FPÖ leader Herbert Kickl spoke of “failure to help”. “The ’emergency measures’ decided in the special session the week before do not even deserve the name – the first money will not flow until August 2022 at the earliest.”, he said.

The federal government has announced a broad package to help ease rising cost of living with one-off payments and the end of the so-called “cold progression” when tax brackets do not take into account inflation changes.

READ ALSO: When will you get your cost of living ‘bonus’ payments in Austria?

Cost of living calculation

The quick estimates of Statistik Austria are based on the existing database at the time of publication, which includes about 80 to 90 percent of the prices necessary for the inflation calculation.

There may, therefore, still be deviations. For example, the quick estimate of inflation for May was initially 8.0 percent, but the value was later revised downwards to 7.7 percent.

The index level of the consumer price index and further results for June 2022 will be announced on July 19th 2022.