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Free business licence in Austria explained

Updated: Mar 20, 2023

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Free business licence

From all the types of self-employment in Austria, self-employment with a free business licence is probably the most common type.

Owning a business licence brings the right to carry out certain commercial activities.

To acquire it one has to fulfil requirements related to residence, age, criminal record, and more.

The important fact is that whether you need a business licence or not depends on the nature of your job, not on your income. A free business licence is required for those working independently, who occupy themselves with a professional activity listed HERE (if after going through the list you’re still not sure whether you fall under the business licence obligation, consider calling the WKO or scheduling consultations with a business consultant).

Examples of professions that fall under the requirement of obtaining a free business licence are:

  • digital marketer,

  • translator (in some cases a profession on the list mentioned above (for example translation - there are different types of translation) might, in fact, belong to the category of new-self employment or require a regulated business licence, therefore if you have doubts just ask the Chamber of Commerce by email, phone call, or personal visitation (often communication in English is possible),

  • web developer,

  • software developer,

  • professional photographer,

  • IT project manager,

  • proofreader.

Registering a free business licence is normally related to an annual fee of around € 100,- (depending on the profession) - this is a fee for membership and advocacy of the Austrian Chamber of Commerce known as the WKO.

Free business licence vs regulated business licence

There are two types of business licences in Austria - free and regulated. To acquire each of them you have to fulfil requirements related to residence, age, and criminal record, however, to get the regulated licence you need to prove qualifications (education and working experience) or pass an exam. Both types have a yearly fee.

The official list of professions that fall under a regulated business licence you can find HERE.

The main differences between a free business licence and a regulated business licence are:

  • to get the regulated licence you need to prove qualifications (education and working experience) or pass an exam

  • for each type of regulated business licence, there are specific descriptions of the business activity and specific regulations regarding education and working experience provided by the WKO

Free business licence vs new self-employment

From all the types of self-employment in Austria mentioned above, new self-employment is probably the least common type.

New self-employed are those working independently who don’t need a business licence registration for their professional activity. In other words, business licence regulations do not apply to new self-employed. This also means that new self-employed are not members of the Chamber of Commerce (WKO) and no membership fee applies - new self-employed have no advocacy group to whom they can turn.

Examples of professions that fall under the category of new self-employment:

artists, writers, journalists, lecturers, self-employed nurses, midwives, scientists, self-employed psychologists, psycho- and physiotherapists.

The main differences between new self-employed and free business licence owners are:

  • New self-employed individuals don’t need to obtain a business licence to carry out a business.

  • New self-employed individuals aren’t members of the WKO, they don’t pay a yearly fee and have no advocacy from the WKO.

  • New self-employed individuals don't automatically have to pay contributions for health and pension insurance (it’s voluntary) if they fall under specific gross annual income and turnover, however, they can opt-in

For more details on new self-employment have a look at our guidebook.

Free business licence vs liberal professions

Liberal professionals need special qualifications but are not subject to commercial law. Access to this category of self-employment is by no means easy and can be costly.

An academic degree and a few years of professional experience are usually required to carry out these activities independently.

Members of the liberal professions perform their services themselves due to their special qualifications. They are fully responsible and professionally independent.

The liberal professions are usually organized either in chambers or in professional associations.

Examples of liberal professions:

The main differences between business licence owners and liberal professionals are:

  • Liberal professionals are insured under the GSVG (Commercial Social Insurance Act) or FSVG (Freelance Social Insurance Act).

  • Special qualifications are needed for liberal professionals - academic degrees and experience.

  • Liberal professionals have their own representation.

Free business licence owners vs independent contracting

There is no legal definition of independent contractors (Freie Dienstnehmer), but the type of contract (Freies Dienstverhältnis) is regulated by the Social Insurance Act (ASVG). According to this Act, an independent contract exists if, for a fee, someone undertakes to provide his client with his workforce for a certain or indefinite period.

It is essential for the independent employment contract that the employee makes his workforce available on a temporary basis. The independent contractor can mainly work with the client's resources.

Independent contractors are insured at Austrian Health Insurance (ÖGK) and do not have to worry about insurance payments - the client covers those. However, as an independent contractor, you are subject to income tax and you have to also file a tax return every year.

The main differences between free business licence and independent contracting are:

  • Independent contractors don’t have to pay social insurance contributions - the customer pays it for them

  • Independent contractors are provided with work equipment by the client, while free business licence owners use their own equipment, have their own office, and are not active on the client's premises.

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