Austria makes it unusually easy to stay tax resident by accident. Either a retained dwelling or simply spending enough time in the country creates unlimited tax liability, and unlike most of the countries in this cluster, keeping a Vienna apartment "just in case" is, on its own, often enough to keep you Austrian for tax purposes. Georgia's 1% regime is real and the treaty between the two countries has been in force since 2006, so a genuine move works. What decides whether it actually does is whether you have closed both routes to Austrian residency, and whether you hold any substantial shareholding that Austria's exit tax, Wegzugsbesteuerung, reaches on the way out.
What you pay now vs. in Georgia
Take a self-employed Austrian IT freelancer (a "Neue Selbststandige") earning EUR 90,000 a year in net profit.
Austrian SVS social insurance runs pension insurance at 18.5%, health insurance at 6.8% and a mandatory self-employment provision fund at 1.53%, according to SVS's own published structure, close to 27% combined, plus a small flat accident-insurance charge. On EUR 90,000 that is roughly EUR 24,300. Income tax then applies across seven bands running from 0% to 55%, and on the remaining taxable profit this produces roughly EUR 24,600.
| Austria (illustrative) | Georgia (Small Business Status) | |
|---|---|---|
| Net profit | EUR 90,000 | EUR 90,000 turnover |
| SVS social insurance | roughly EUR 24,300 | none equivalent |
| Income tax | roughly EUR 24,600 | 1% of turnover |
| Total | roughly EUR 48,900 | EUR 900 |
This is illustrative, not a filing-ready number - the exact figure depends on deductible expenses and exactly where your profit lands across the seven bands. What it shows honestly is that SVS contributions alone already exceed what most freelancers assume their whole Austrian bill will be, before income tax is even applied.
Does the 1% actually apply to you
Georgia's 1% only applies to Georgian-source income, and for services that generally means work physically performed in Georgia, a test we cover in Georgian-source income rules. An Austrian national who registers a Georgian IE and keeps working from Graz has a source problem before any Austrian rule below is even relevant.
Small Business Status itself also rules out consulting, legal, medical, auditing and licensed work, and caps turnover at 500,000 GEL. A freelance developer or designer clears both easily; someone invoicing as a "consultant" for ordinary technical work does not.
What Austria does when you leave
Two things decide whether the move survives contact with Austrian law, and a third only matters if you hold real company shares.
Austrian tax residency needs either a Wohnsitz (a dwelling kept available for your own use) or a gewohnlicher Aufenthalt (habitual abode). Either alone triggers unlimited tax liability on worldwide income. Staying in Austria over six months creates habitual abode automatically, even retroactively for the earlier months. The Wohnsitz test is the one movers underestimate: keeping a furnished apartment you could use at any time is enough, regardless of how many days you actually spend there.
The Zweitwohnsitzverordnung is the only way out if you keep an Austrian home. It exempts a retained dwelling from creating unlimited tax liability, but only if you use it 70 days a year or fewer, keep a logbook of actual use, and your centre of vital interests has genuinely been abroad for the preceding five years. Miss any part of that and the apartment alone makes you Austrian tax resident, whatever Georgia thinks of the arrangement.
Wegzugsbesteuerung, Austria's exit tax under section 27(6) of the income tax act, deems shareholdings of 1% or more disposed of at market value the day you cease Austrian residence. It targets real securities and private company shares you already hold, not a Georgian entity formed after you arrive. An Individual Entrepreneur has no shares at all, so it never applies to one. Moving within the EU/EEA gets an automatic instalment deferral; moving to Georgia, outside that zone, is a harder conversation and worth resolving before you file a departure return, not after.
Austria's CFC rule, section 10a of the corporate tax act, only reaches a foreign company held by an Austrian corporation, not an individual holding a Georgian entity personally. BMF's own guidance on capital gains confirms the exit-tax mechanics sit in a separate part of the code entirely, which is why the practical Austrian risk for most movers is the residency tests above, not a look-through rule.
Georgia is not on the EU's list of non-cooperative jurisdictions, which Austria applies rather than running a separate national blacklist, and the treaty between the two countries has been in force since 1 March 2006, per BMF's treaty network page, later updated by a 2012 protocol. Austria and Georgia have no social security totalisation agreement, so deregistering from SVS simply stops contributions from accruing rather than continuing anywhere else.
The steps, in order
- Check your activity against Georgia's prohibited list first. Consulting, legal, medical, auditing and licensed work cannot hold Small Business Status regardless of anything else here.
- Decide what happens to any Austrian home before you leave. Sell it, let it go entirely, or qualify properly for the Zweitwohnsitzverordnung with a genuine usage log.
- Actually relocate your habitual presence to Georgia. Both Austrian residency tests turn on facts on the ground, not a filed form.
- Deregister your Austrian address (Abmeldung) at your local registration office once you have genuinely left.
- Deregister with SVS so social insurance contributions stop accruing from your declared date.
- File your Austrian tax return for the departure year, and address Wegzugsbesteuerung directly if you hold any substantial shareholding.
- Register a Georgian Individual Entrepreneur and apply for Small Business Status, in person or under power of attorney through remote registration.
- Get a Georgian Tax Residency Certificate once you cross 183 days, as evidence an Austrian bank or the Finanzamt will actually accept.
Timeline and cost
The Georgian side is quick: an IE with Small Business Status is typically registered within a few business days, longer under power of attorney if apostille timelines add delay. The Austrian side is slower to close properly. Abmeldung is immediate once filed, but confirming you genuinely qualify for the Zweitwohnsitzverordnung, if you are keeping a property, takes real documentation built up over months, not a form filed on the way to the airport. Budget for an Austrian tax adviser to handle the departure return and, if Wegzugsbesteuerung applies, the instalment or deferral request.
The verdict: strong fit once both residency tests are genuinely closed
Austria has a real treaty since 2006, is not blacklisted, and its CFC rule does not reach an individual holding a Georgian entity directly. The catch is not a look-through rule, it is that Austrian residency is unusually easy to keep by accident. A retained apartment, on its own, can be the entire problem.
For someone who genuinely relocates, closes out or properly qualifies any Austrian dwelling, and has no substantial shareholding sitting behind them, this is a strong fit, and the saving on SVS contributions and income tax together is real and large. For someone keeping a Vienna flat "for visits" without running the Zweitwohnsitzverordnung numbers, the honest answer is that Georgia's 1% may be entirely beside the point, because Austria never let go in the first place.
We'll work through whether your Austrian residency is genuinely breakable given any property you keep, whether Wegzugsbesteuerung applies to anything you hold, and what the honest all-in comparison looks like once SVS contributions are counted properly.
See what it costs
If you are weighing this against a country with its own exit-tax logic, our Belgium guide and Switzerland guide cover the closest parallels in this cluster. Our Georgia tax residency guide covers the 183-day test from the Georgian side, and our double tax treaty guide covers how to invoke the Austria-Georgia treaty once you need to.
Key takeaways
- Austrian residency needs either a retained dwelling or habitual presence, not both, and a kept apartment alone is usually enough on its own.
- The Zweitwohnsitzverordnung can exempt a genuinely secondary home, but only under 70 days of use a year with a real log and five years of life centred abroad.
- Wegzugsbesteuerung only reaches substantial shareholdings of 1% or more; a Georgian IE, with no shares, is never in scope.
- Austria's CFC rule only reaches a foreign company held by an Austrian company, not an individual holding a Georgian entity directly.
- SVS social insurance runs close to 27% of net profit, and is usually a larger surprise than the income tax bill itself.
- Austria has had a treaty with Georgia since 2006 and does not blacklist it.
- The verdict is strong fit once both residency tests are genuinely closed, not just once a Georgian company exists.
Frequently asked questions
Does Austria have a tax treaty with Georgia?
Yes, in force since 1 March 2006 and updated by a 2012 protocol, per Austria's Federal Ministry of Finance. That gives a genuine tie-breaker if both countries claim you as resident in the same year.
How is Austrian tax residency actually broken?
You need to end both a Wohnsitz, a dwelling available for your own use, and a gewohnlicher Aufenthalt, habitual presence. Either one alone keeps you Austrian resident on worldwide income, which is why simply spending most of the year abroad is not enough if a usable home stays behind you.
Does keeping an apartment in Austria really make me tax resident?
Generally yes, unless you qualify for the Zweitwohnsitzverordnung exemption. That requires using it 70 days a year or fewer, a kept log of actual use, and your centre of vital interests abroad for the preceding five years. Without meeting all of that, the apartment alone is enough.
Does the Austrian exit tax apply to a Georgian IE?
No. Wegzugsbesteuerung under section 27(6) of the income tax act only reaches shareholdings of 1% or more in a company. An Individual Entrepreneur is a sole proprietorship with no shares, so it never triggers the exit tax.
What happens to real shares I already hold when I leave?
They are deemed disposed of at market value on the day Austrian residence ends, taxed at the capital gains rate. Moving within the EU/EEA gets an automatic instalment deferral; moving to Georgia requires resolving the position directly rather than assuming the same deferral applies automatically.
Do Austria's CFC rules reach a Georgian company I own personally?
No. Section 10a of the corporate tax act only applies where an Austrian company holds the foreign entity. An individual holding a Georgian IE or LLC in their own name sits outside it.
How much does Austrian social insurance actually cost compared to Georgia's 1%?
SVS contributions run close to 27% of net profit for a self-employed person, covering pension, health and a mandatory provision fund. Georgia's Small Business Status carries no equivalent charge, which is a large part of the real saving.
Is Georgia on Austria's blacklist?
No. Austria applies the EU's list of non-cooperative jurisdictions rather than a separate national list, and Georgia is not on it.
Do I need to deregister with SVS when I leave?
Yes. Cessation of self-employed activity needs to be declared so contributions stop accruing from your declared date, rather than continuing to build up after you have genuinely moved.
Should I sell my Austrian apartment before I move?
Not necessarily, but you need a real answer either way. Selling removes the Wohnsitz question outright; keeping it means qualifying properly for the Zweitwohnsitzverordnung with genuine usage records, not assuming a filed change of address is enough on its own.