Austria – Company Incorporation Guidance
Austrian law has certain strong formal requirements relative to the foundation of a GmbH. The application for registration and a specimen sheet needs to be signed by the managing director of the GmbH in front of a notary. If the documents are signed in the UK or certain other countries, an Apostille is required for these signatures.
The share capital needs to be paid into an Austrian bank account, opened in the name of the company; the bank will issue a certificate confirming that the share capital was paid and this is then presented to the commercial register.
What duties are levied on Company Formation?
All duties, taxes and professional fees are included in our package which includes payment of the following, amongst others:
- A capital transfer tax (Gesellschaftssteuer) equivalent to 1% of the share capital (Stammkapital) must be paid for setting-up the GmbH.
- The commercial court charges a fee when entering the new GmbH in the business register.
- Production of the notarial deed (Notariatsakt) and publication of the GmbH registration.
Company Formation process
The company becomes a legal entity when it is formally entered in the business register (Firmenbuch) kept by the local commercial court (Handelsgericht) and the company statutes need to be signed before a notary. Austrian law permits signing by proxy, if the proxy holds a written special power of attorney (Spezialvollmacht).
The statutes must contain:
- The corporate name and registered office of the company
- The objects of the business
- The amount of share capital (Stammkapital) and share interests (Stammeinlagen) of the shareholders
Austrian companies must have their registered office in Austria.
Main Features of Austrian GmbH
- An Austrian company is legally exempt from dividends tax received from a foreign subsidiary. Austria levies no withholding tax on dividends paid to the foreign parent.
- As a member of the European Union (EU), Austria is governed by the EU’s Parent-Subsidiary directive. Thus, an Austrian holding company which holds at least 25% of the shares of an EU subsidiary can receive dividends from the subsidiary free of withholding tax.
- An Austrian company can access a large network of double taxation treaties Austria has signed with nations around the world.
- A minimum of one director and one shareholder is required to incorprate an Austrian company. The shareholder and director can be the same person, and need not be resident in Austria. Corporate shareholders are permitted in Austria.
- It is easy to open global corporate bank accounts to support your Austrian company.
- Austria is regarded as one of the world’s most competitive economies. It has excellent business advantages including its economic performance, government efficiency, business efficiency and infrastructure.
- A GmbH pays corporate profits tax of 25% on all income. In addition financial statements must be submitted to the Austrian Chamber of Commerce. Formacompany will assist our clients efficiently and effectively to complete this annual statutory obligation.
- An Austrian company formation requires a minimum share capital of €35,000, of which at least half, €17,500, must be paid up front in cash.
- A register containing directors and shareholders details is available for public viewing.
Austria Branch Office
A branch is one way for a company to conduct business in Austria but it has many drawbacks. The largest drawback is that the foreign parent company carries full liability for the branches operations and this can lead to complicated dealings with the tax authorities.
We recommend incorporating a GmbH in Austria for more flexible business options and less tax liability. For further information regarding Branch registration please contact us.