Reader Question: Can I have a freelance side gig as an employee in Austria?
If you’re looking for a new career direction in Austria, becoming self-employed can be a rewarding and exciting challenge. But can you start the process while you’re already in employment?
Deciding to leave behind the security of a steady employment contract to become a freelancer can be difficult. That’s why many people choose to start by trying out with a side gig - or a nebenberufliche Tätigkeit - as a freelancer while still in employment.
In Austria, this is generally allowed, as long as it is not explicitly prohibited by your employment contract.
So if you’re thinking to start up a freelance sideline, the first thing you should do is read your employment contract carefully to check whether it is permitted by your employer. Some work contracts might also require you to get express permission from your employer before taking up another job.
In general, it's a good idea to be open with your employer about your freelance sideline, as it will allow you to talk openly about your freelancing activity at work, without having to hide anything.
Once you've overcome this first "hurdle," you'll need to check whether your future activity in Austria falls under the Trade Act (Gewerbeordnung). If it does, you will have to apply for the corresponding business license.
READ ALSO: What is a regulated business licence in Austria and who needs one?
In Austria, a distinction is made between the so-called free trades (e.g. marketing services and hospitality), for which you don't need a Befähigungsnachweis - "certificate of competence" - proving you have expertise in this area, and the regulated trades (e.g. working as a financial advisor or real estate agent). Those who belong to the so-called "new self-employed", such as artists, writers and journalists, also don't need to have a trade licence.
However, everyone taking up self-employment, whether full-time or part-time, must register with the relevant tax office within two months of starting the freelance activity.
Do I need additional insurance?
As an employee, you are automatically insured by your employer, so you don't need to worry about sorting out your insurance.
But if you also run a business on the side, you are obliged to have additional insurance once you start earning over a certain amount.
Currently, part-time self-employed people can earn up to €4,871.76 per year without falling under another mandatory insurance scheme. Beyond this threshold, you will be doubly insured and will have to pay contributions for health, pension, and accident insurance.
How many hours can I work?
In Austria, unlike in Germany, there is no fixed limit to how many hours per week you may devote to your part-time employment. However, your total working time (your day job and your self-employed job) may not exceed the maximum working time of 60 hours per week.
How much tax will I have to pay?
In Austria, once your income from your freelance activity reaches €11,000, you become liable for taxes. This threshold is crucial for those who are self-employed on the side because the tax rates are as follows:
Between €11,000 and €25,000: 36.5 percent
Between €25,000 and €60,000: 43.2 percent
Above €60,000: 50 percent
READ ALSO: Do I have to register and pay taxes in Austria if I’m a remote worker?
Also, pay attention to the value-added tax (Umsatzsteuer). Once your the revenue from freelancing exceeds €30,000 per year, you will need pay VAT and register for a VAT number with the tax authorities.
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Deciding to leave behind the security of a steady employment contract to become a freelancer can be difficult. That’s why many people choose to start by trying out with a side gig - or a nebenberufliche Tätigkeit - as a freelancer while still in employment.
In Austria, this is generally allowed, as long as it is not explicitly prohibited by your employment contract.
So if you’re thinking to start up a freelance sideline, the first thing you should do is read your employment contract carefully to check whether it is permitted by your employer. Some work contracts might also require you to get express permission from your employer before taking up another job.
In general, it's a good idea to be open with your employer about your freelance sideline, as it will allow you to talk openly about your freelancing activity at work, without having to hide anything.
Once you've overcome this first "hurdle," you'll need to check whether your future activity in Austria falls under the Trade Act (Gewerbeordnung). If it does, you will have to apply for the corresponding business license.
READ ALSO: What is a regulated business licence in Austria and who needs one?
In Austria, a distinction is made between the so-called free trades (e.g. marketing services and hospitality), for which you don't need a Befähigungsnachweis - "certificate of competence" - proving you have expertise in this area, and the regulated trades (e.g. working as a financial advisor or real estate agent). Those who belong to the so-called "new self-employed", such as artists, writers and journalists, also don't need to have a trade licence.
However, everyone taking up self-employment, whether full-time or part-time, must register with the relevant tax office within two months of starting the freelance activity.
Do I need additional insurance?
As an employee, you are automatically insured by your employer, so you don't need to worry about sorting out your insurance.
But if you also run a business on the side, you are obliged to have additional insurance once you start earning over a certain amount.
Currently, part-time self-employed people can earn up to €4,871.76 per year without falling under another mandatory insurance scheme. Beyond this threshold, you will be doubly insured and will have to pay contributions for health, pension, and accident insurance.
How many hours can I work?
In Austria, unlike in Germany, there is no fixed limit to how many hours per week you may devote to your part-time employment. However, your total working time (your day job and your self-employed job) may not exceed the maximum working time of 60 hours per week.
How much tax will I have to pay?
In Austria, once your income from your freelance activity reaches €11,000, you become liable for taxes. This threshold is crucial for those who are self-employed on the side because the tax rates are as follows:
Between €11,000 and €25,000: 36.5 percent
Between €25,000 and €60,000: 43.2 percent
Above €60,000: 50 percent
READ ALSO: Do I have to register and pay taxes in Austria if I’m a remote worker?
Also, pay attention to the value-added tax (Umsatzsteuer). Once your the revenue from freelancing exceeds €30,000 per year, you will need pay VAT and register for a VAT number with the tax authorities.
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