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The Business Environment in Austria

Austria combines a healthy economy with very high living standards, making it an interesting option for expats. InterNations has compiled this short guide on working in the republic in the Alps to help you make the most of your expat experience.
Employees in Austria enjoy favorable working conditions.

Einkommensteuer and Taxation Agreements

If, during the tax year, your principal residence has been in Austria, you are required to pay Einkommensteuer: Taxes on all income earned during that period. This applies to income from Austrian and non-Austrian sources. Income taxes are deducted at source if you are employed in Austria. As a freelancer or self-employed person in Austria, you are expected to file a declaration of your annual income after every financial year.

Double taxation agreements are in place between Austria and its neighboring states, all EU member states and several other countries. For nationals of the concerned countries, this means that they are not subject to Austrian income tax if their principal residence during this time was in their country of origin, and vice versa. Please consult the website of the Austrian Ministry of Finance for a detailed list of all double taxation agreements.  

What Does Your Krankenversicherung Cover?

Like income tax, social security contributions are deducted at source from every employee’s salary. They are paid by the employer and the employee, and rates depend on the income and individual situation of the employee.

Social security mainly includes:

  • health insurance (including maternity protection)
  • accident insurance, which covers accidents at the workplace, vocational illness and its consequences
  • old-age pension benefits
  • unemployment insurance, e.g. unemployment benefits or social welfare

Austria has social security agreements with all EU countries and some other nations that ensure you don’t lose your entitlement to social security benefits when moving from one country to another. For a list of these agreements with explanations (in German), please visit the website of the Federal Ministry for Labor, Social Welfare and Consumer Protection.

Working Hours, Maternity Leave, and Women’s Rights

People working in Austria benefit from fair working conditions and employee protection. A standard working day consists of eight hours (within 24 hours), adding up to 40 hours per week for full-time employees. You may take 25 days of paid vacation per year, in addition to several official public holidays.

Female employees are obliged to take maternity leave for the final eight weeks of their pregnancy and the first eight weeks following the birth of their child. During this period, they receive a monthly allowance (“Wochengeld”) corresponding to their average net salary during the three months prior to their maternity leave. In addition, both parents (only one at a time) are entitled to so-called Elternkarenz, i.e. unpaid maternity or paternity leave which can be taken during the first 24 months of the child’s life. During this time, they enjoy protection against redundancy and their employer is obliged to take them back in the same or equivalent position. Additionally, the parent who is on leave is entitled to apply for a childcare allowance.

As in most European countries, you should never be discriminated against because of your gender. On average, however, men still earn a higher salary than women with the same qualifications, and the majority of top management posts are occupied by men. Recently, many Austrian companies have strengthened their efforts to increase the number of female employees in top management positions, and better protection of women’s rights is a priority of Austria’s foreign policy.

Handshake vs. Kuβ die Hand

Business relations tend to be quite formal: rank and titles are important, and people should always be addressed by their correct title followed by their last name. Make sure to use the formal “Sie” rather than the informal “Du” for the word “you”, unless you are explicitly invited to do otherwise. Punctuality and accuracy have a higher value than in some other cultures, so you should turn up for meetings in good time and be well-prepared. Similar to their day-to-day communication, Austrians tend to be direct and you will be expected to back up your statements with facts and figures. 

At the first meeting, it’ s important that you greet each other with a short, firm handshake, while maintaining eye contact. However, foreign business women should not feel offended or belittled if their male Austrian business partner — especially if he is an older gentleman — prefers a “Küß’ die Hand” to a handshake when greeting a lady. This is the traditional Austrian way, and as a rather conservative country, people tend to honor their traditions. Expat men, however, are not expected to use this handshake.


We do our best to keep this article up to date. However, we cannot guarantee that the information provided is always current or complete.

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