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WORKING IN AUSTRIA

Can I work for my foreign employer as a self-employed person in Austria?

Setting yourself up as self-employed in Austria is a fairly complicated process, which means you can't necessarily continue doing the role you did in your previous country.

Can I work for my foreign employer as a self-employed person in Austria?
Even if you and your employer both want to continue working together after your move to Austria, you still have bureaucratic hoops to jump through. Photo by Tima Miroshnichenko from Pexels

As part of our service to our readers and members, we often answer questions on life in Switzerland via email when people get in touch with us. 

When these have value to the greater Local Austria community, we put them together as an article, with ‘reader question’ in the headline. 

Have you got a question, query, comment or issue to raise? Get in touch at [email protected]

I’m moving to Austria for my partner’s job, and I’d like to continue working for my current employer. They don’t have an office in Austria but they are happy for me to work remotely. Can I do this on a self-employed basis?

This is a situation many foreign residents may find themselves in, if you’re moving to Austria for a reason other than your own work, so we’ll look at a few scenarios. 

The simplest case is if your employer is already established in Austria. In this case, it may well be possible for you to be employed by their Austrian entity, either through an internal transfer or by applying for a job there.

READ MORE: How to prepare for your Austrian tax return if you’re self-employed 

Even if their Austrian branch is in a different city or region to the area you’re moving to, it would be possible for them to employ you from the perspective of Austrian employment law, so it’s just your company’s policy you’d need to look into.

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If your employer is not established in Austria (ie. does not have its business registered there and does not pay taxes to Austria), things will be trickier.

The key issue is not whether your employer already does business with Austria-based clients, but whether the employer themselves is registered in Austria.

In that case, your employer cannot directly employ you if you are registered for tax purposes in Austria.

What if my employer is not registered in Austria?

Assuming that you are registered in Austria, that leaves you with two main options.

The first is to become self-employed. There are set processes for this in Austria, including getting a trade licence (Gewerbeschein) for some types of professions, and registering with social security (SVS) and the tax office (Finanzamt).

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

If you are able to establish yourself as a self-employed worker in Austria, you could work for your former employer, but you’d need to ensure you met Austria’s strict conditions for true self-employment.

When you register, SVS will ask you questions about your work to determine which category of employment you fall into.

You and the company you work for cannot decide this; it’s up to SVS who use a range of criteria to assess the working relationship.

The reason for this is to avoid “bogus self-employment” where companies do not pay taxes in Austria but hire people under conditions that effectively amount to employment.

“Signs for an independent business are: having more than one client; not being dependent on the “employer”; having your own structure/not being part of a corporate work structure (in terms of workflows, reporting etc); having your own work materials; having the right to be substituted by someone else (to carry out the work set); issuing invoices after completing a project rather than issuing the same amount on a monthly basis,” explains Claudia Barton, a tax consultant who specialises in working with expat clients.

There’s no one criteria which will determine your employment status, so SVS will make an overall assessment.

This means that if you want to continue working for your former employer as a self-employed person, you would need to look over the contract very carefully and would most likely need to make some changes to your working relationship, including the workflow and work structure as explained by Claudia above.

Note also that taxes and especially social security contributions are quite high for self-employed workers in Austria. A rule of thumb commonly cited by self-employed people is to set aside 50 percent of your income to pay business-related fees.

Depending on which country you worked in before, this may mean that you need to charge your former employer higher rates; when you were an employee, in most countries it will be the case that they were paying social security contributions and taxes in addition to the fees you paid, whereas self-employed people shoulder all these payments and need to adjust their rates accordingly.

READ MORE: How to survive as a freelancer in Austria

Pros of this approach are the increased flexibility, and the opportunity to add new clients to your roster, but the downsides are that your role may not work on a self-employed basis of it was designed as an employee role.

If you’re new to self-employment in Austria, it is highly advisable to seek help from a tax advisor and/or other advice services such as the Expat Business Agency in Vienna if that’s where you’re based.

There is an alternative option which some expats choose to take: using an umbrella company or employer-of-record. In this scenario, you are officially employed by one company which hires you out to the company you want to work for.

The employer-of-record charges a fee to your ’employer’ to cover a salary which is paid out to you, the necessary employer taxes and social security contributions, and usually a fee.

As an example, the umbrella company Oyster HR has a salary calculator, which shows that to pay someone the equivalent of a €40,000 gross annual salary, the company would need to pay €4,992 each month.

This is the route which British national Tom Barron took after moving to Vienna in 2019. He initially worked for multiple clients on a self-employment basis, but slowly began to spend most of his time working for one company.

Telling The Local why he chose to go down this route, he explained: “Having had a mix of experiences, both employed and self-employed, I decided I would like to establish a consistent income. Also, I had learned from my self-employment experience that I needed to improve my German before doing my own taxes and paperwork again. I found it difficult to manage self-employment with my own German level and so then having an umbrella company do this, whilst little changes were made to my day to day work, made total sense.”

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

His client spoke with the umbrella company (it’s usually the employer who needs to do this, rather than the person who will become their employee) and received a contract which his legal advisor reviewed.

He notes: “If you have various projects from various companies, self-employment will usually work just fine. If you plan on working for one foreign company, it’s safer to go through an umbrella company.”

Advantages of this option include the limited paperwork and administration compared to self-employment, and accessing the benefits that come with being an employee. 

Useful links

Examples of umbrella companies operating in Austria: Deel, OysterHR, Remote

Self-Employed in Austria

Vienna Business Agency

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WORKING IN AUSTRIA

Six official websites to know if you’re planning to work in Austria

If you are moving to Austria and planning to work once you're here, there are a few websites that you need to know.

Six official websites to know if you’re planning to work in Austria

Austria is certainly one of the best countries to work in, with strong labour laws that give employees access to public health insurance through their employers, a minimum five weeks of paid vacation and many rights for families.

The alpine country is also known for its high quality of living. Residents can enjoy cheap public transport, public schools and plenty of free or cheap cultural, sports and leisure options.

There are also many vacant jobs, and the country is aiming to make it easier for foreigners who have qualifications to come fill in those jobs – many in nursing and healthcare professions, but a lot in several other so-called “shortage occupations”.

READ ALSO: How Austria is making it easier for non-EU workers to get residence permits

If you are planning to work in Austria, here are a few government or government-linked websites to know.

Migration.gv.at

It may not look very modern, but this website will have most of the things you’ll need if you want to move to Austria – especially coming from countries outside of the European Union.

This is where you will find the infamous “point calculator” to see if you get the minimum amount of points based on specific criteria (such as age, education, and language knowledge) to be able to apply for certain work-based residence permits.

There are also many pages explaining the different visas, permits, and many other issues with migration to Austria. The website has a very extensive and complete English version.

READ ALSO: EXPLAINED: The 2022 salary requirements for Austria’s EU Blue Card

ABA – Work in Austria

ABA – Work in Austria is a department of the Austrian Business Agency, which operates under the Federal Ministry for Digital and Economic Affairs in Austria.

The website has plenty of information – in English – about Austria, living and working in the country, and its job market. ABA – Work in Austria also offers services, including relocation and recognition of qualifications.

Vienna Business Agency

Another site aimed at expats and immigrants but connected to the City of Vienna. The website is entirely in English (there is a German version, too), and most of it will have tips and services for businesses and startups settling in the Austrian capital.

However, there is also an extensive advice area for foreigners. 

People moving to Vienna can also schedule in-person and free appointments to receive advice on anything from setting up a company to paying taxes.

READ ALSO: The downsides of Vienna you should be aware of before moving there

Portal der Arbeiterkammern

This is the Chamber of Labour website, which is an organisation that represents the interests of 3 million Austrian employees and consumers.

Even if you are not a member, it still has plenty of valuable information on Austria’s working and labour market. The website, however, is only in German.

Der Wirtschaftskammer

Also, a local website, WKO is the Austrian Chamber of Commerce, and even though it is only in German, it holds a lot of information, especially on labour laws in the country.

Furthermore, it is possible to schedule a free appointment with an English-speaking representative to answer questions on employment, self-employment, and more.

READ ALSO: Which are the best companies to work for in Austria?

Public Employment Service Austria (AMS)

This is Austria’s official provider of labour-market related services. The government agency offers placement assistance and vocational counselling.

It is also the point of contact for those looking to register as employees, hire people or seek many of the benefits (including unemployment payments) that they are entitled to. It also has a job-looking platform.

Even though a part of the website is in English, most of the pages are in German only. It is also challenging to find people willing to speak English at the AMS offices.

Bonus website: The Local

Besides our news website, with pieces that will help you learn more about life in Austria and be up to date on the latest and most important information, The Local also has a job search platform where you can look for open positions which require only the English language.

Check out our jobs platform here. 

Do you know any other government or government-linked websites that might be useful for people working in Austria? Let us know: [email protected]

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