taxation

Any corporate profits (which generally do not occur in the initial phase of start-ups) are taxed at 23% corporate tax, and distributions to the shareholder (natural person) are subject to the special tax rate of 27.5%.

Minimum tax

In loss-making years, a minimum tax is imposed, which can be offset against the actual corporate income tax in subsequent years if the annual results are positive. The minimum tax is EUR 500 for the entire calendar year.

Reorganizations

Reorganization measures (e.g. merger, conversion, contribution, division) can be carried out in a tax-neutral manner under certain conditions.

Minimum share capital

There is a minimum share capital of EUR 10,000, of which at least half (EUR 5,000) must be paid in cash. Aside from this, a non-cash foundation is possible.

Employee participation

Shares can be granted free of charge or at a discount without taxable dry income (e.g., granting of shares by means of a negative liquidation preference, granting of shares under the application of Section 67a of the Income Tax Act [new start-up employee participation]).

Compliance costs

The costs for the processing of ongoing accounting tax compliance (e.g. preparation/publication of annual financial statements, preparation/submission of tax returns, WiEReG reporting obligations) are identical.

GmbH

FlexCo

granting

non-voting shares

Granting of substance usufruct rights:

• No right to participate in the General Meeting

• no appearance in the commercial register

Granting of:

• Substance usufruct rights (see “GmbH”)

• Company value shares

  • Right to participate in the General Meeting

  • no appearance of the individual shareholders in the commercial register (a non-published share register must be maintained)

Share transfers

Notarial deed for GmbH shares

In the case of usufruct rights, compliance with the written form is sufficient

For FlexCo shares, a notarial deed or a private legal document (by a lawyer or notary) is possible

For company shares, compliance with the written form is sufficient (in principle neither a notary nor a lawyer is required)

Supervisory board duty

if share capital > EUR 70 thousand

and

• over 50 shareholders

or

• more than 300 employees

as with GmbH

and

if the company is a medium-sized company (as defined in Section 221 Paragraph 2 and 4 of the Austrian Commercial Code ), i.e. it exceeds 2 out of 3 of the following criteria:

• EUR 6.25 million balance sheet total

• EUR 12.5 million in sales revenue

• 50 employees on average per year

Capital increase

Ordinary capital increase permitted. No conditional or authorized capital increase possible.

ordinary capital increase

as well as

• conditional capital increase (e.g. conversion or subscription rights for creditors, stock options for employees) and

• Authorized capital increase (capital increase resolution on “reserve”) possible

Own shares

only possible to a limited extent (e.g. free of charge, by way of universal succession, to compensate minority shareholders)

Acquisition of own shares is permissible under certain conditions under company law (e.g. redemption, sale within a certain period, by way of universal succession, to compensate minority shareholders)

Circulating resolutions

All shareholders must agree to the circular vote. Voting requires a signature.

The articles of association may stipulate that the consent of all members is not required for a written vote. Voting may be conducted in text form (e.g., by email).