Planning an expansion to Austria is an exciting milestone for your company, but it also comes with its share of challenges. One of those challenges is setting up your Austria payroll. You have to decide among different payroll options, learn the country’s employment compliance laws, and continue to run your parent company.
G-P is here to make your expansion easier. As a global Employer of Record (EOR), you won’t have to worry about compliance or how to add employees to your payroll — with us, you can simply focus on growing your company and we’ll handle the rest.
Taxation rules in Austria
Austria has extensive taxation policies for people who are self-employed or in paid employment. Employers and employees both contribute to these funds at various rates:
- Pension insurance: Employers contribute 12.55%, employees contribute 10.25% plus 1.53 % additional mandatory pension insurance (“BV Beitrag) for the employer
- Accident insurance: Employers contribute 1.1%
- Health insurance: Employers contribute 3.78%, employees contribute 3.87%
- Unemployment insurance: 5.9 %, split equally (2.95% each from the employer and employee)
- Others: Employers contribute 0.6%, employees contribute 1%
Employees may also have to make contributions to a trade union or religious community, such as a church tax. Employers deduct these payments from employees’ pay.
Austria payroll options for companies
You have 3 different Austria payroll options to choose from:
- Internal: Large subsidiaries that will operate in Austria long-term may choose to run an internal payroll. Doing so requires a much larger HR team and the budget to hire and train new employees.
- Austria payroll processing company: Working with an Austria payroll processing company can help outsource your payroll, but you’ll still be responsible for all compliance-related matters.
- G-P: The easiest way to run payroll in Austria and stay compliant is partnering with an Employer of Record (EOR) like G-P. With us, you can rest assured that your team will be paid on time, freeing you to focus on other important aspects of your business.
How to set up a payroll in Austria
If you decide to set up your Austria payroll yourself, you need to establish a subsidiary first. Completing this step can take weeks or months depending on your subsidiary’s location and structure.
Entitlement/termination terms
Termination can often be tricky in another country. We recommend outlining entitlement and termination terms in an employment contract before hiring employees and choosing your Austria payroll solution. Termination requires advance notice depending on how long the employee has worked for your company. Employers are not required to provide severance pay.
Streamline global payroll management with G-P.
G-P streamlines each step of the payroll management process with our market-leading global employment platform. Pay your team with confidence anywhere in the world in 150 currencies with our 99% on-time automated payroll system — all with just a few clicks. Our products also integrate with leading HCM solutions, syncing employee payroll data across platforms automatically to create one reliable, convenient source of truth for HR teams.
Contact us to learn more about how we can support you.