Payroll in Austria.
Set up and run your payroll in Austria within the shortest delays. Our team of experts supports you on the entire compliance chain.
Get startedDisclaimer: This country guide is provided for informational purposes only and does not constitute legal advice. While we update it regularly, it may not reflect ongoing regulatory changes. Illizeo SA disclaims any liability for actions taken or not taken on the basis of this content.
Pay your team in Austria
Austria is a relevant destination for international hiring. Employing staff there involves complying with local payroll regulations.
Employers must meet ongoing obligations to declare and pay payroll taxes. This guide outlines the key elements foreign companies should know before hiring there.
Setting up payroll in Austria
There may be no formal obligation to set up a local entity. Employers must register with the local tax authority and social security bodies before processing the first payroll.
Once registration is validated, employers are required to inform the relevant authorities of every new hire. Employers should pay particular attention to local pension and benefits requirements applicable in Austria.
No legal obligation to hold a local bank account for payroll: payments may be made from foreign accounts. For wire transfers to local authorities, use the bank details specific to international payments and pay in the local currency to avoid FX charges.
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Taxes & social security in Austria
The local social security system is funded by both employer and employee contributions. The income tax system is generally progressive, with brackets that vary depending on residence and revenue level.
Tax residents are taxed on their worldwide income, while non-residents are only taxed on their locally-sourced income. Tax brackets, rates and thresholds are reviewed annually.
Withholding & reporting
Employers must withhold income tax from their employees and remit it to the local tax authority. This involves recurring filings throughout the fiscal year, with penalties for late or missing returns.
Social contributions
In addition to income tax, employers contribute on behalf of their employees to a national social security scheme covering pensions, unemployment, healthcare and other benefits.
| Employer contribution | Country average | Notes |
|---|---|---|
| Total employer load | 21.2% | Includes social security and applicable industry funds. |
Employment obligations
Employees benefit from several statutory rights:
- Annual leave & public holidays: 25 days annual leave + 13 public holidays
- Maternity / paternity leave: statutory leave with partial or full pay depending on tenure.
- Sick leave: based on medical certificate, partially paid for a defined period.
- Working hours: statutory standard week, with overtime regulations.
Compensation
The minimum wage in Austria is set as follows:
- Statutory minimum wage: Collective bargaining
- Local language(s): Allemand
- Currency: EUR
Overtime regulations and 13th-month payments may apply depending on industry collective agreements.
Payroll requirements
The standard pay frequency is monthly. Each payment must be accompanied by a payslip showing gross salary, deductions and net amount payable. Payroll archives must be kept for the legal retention period.
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