Trade professionals are insured by health, pension, accident insurance and self-employed pension provisions on a compulsory basis. Health and pension insurance is regulated by the Commercial Social Security Act (GSVG); accident insurance by the General Social Security Act (ASVG); and the self-employed pension provisions by the Company Retirement Plan Act (BMSVG).
Trade professionals are not insured by unemployment insurance. The trade professional retains any entitlements to unemployment benefits arising from previous employment when certain requirements are met. For more details, see our information leaflet “Unemployment insurance coverage for entrepreneurs”. The option of voluntary insurance for the risk of unemployment has been in place since 1 January 2009.
Category of persons
The following are insured on a compulsory basis
- Sole proprietors with a business a licence,
- partners in a partnership (OG):
- limited liable partners in a limited partnership (KG):
- managing directors (under commercial law) who are shareholders in a GmbH (if not insured under the ASVG in this function).
Membership of the company in the Chamber of Commerce is required for the compulsory insurance of partners/shareholders.
All managing directors who are also shareholders in a joint stock company and subject to income tax are liable for insurance deductions (stake up to 25%, regardless of the existence of a blocking minority) under the AVSG. Those managing directors who were already shareholders in a GmbH on 31 December 1998 can continue to be insured on a compulsory basis under the GSVG.
Commencement of compulsory insurance
The compulsory insurance always commences on the day on which the eligibility establishing the compulsory insurance has been obtained.
Although the trade authority notifies the SVS (Social Insurance Institution for the Self-Employed) about the business registration, the trade professional is required to make the notification himself within one month. This step can be dispensed with when an electronic notification is made with the trade authority.
Exemptions from health insurance and pension insurance
Persons who report their business licence as inactive are exempt from compulsory insurance under the GSVG.
Exemptions from self-employed pension provisions
For trade professionals who take up a pension of their own, the obligation of payment of the contributions for self-employed pension provisions ends automatically with the first earnings of the pension. They can voluntarily opt into the company’s self-employed pension provisions, however.
Amount of contributions and contribution base
6.80% of the contribution base must be paid into health insurance, 18.50% into pension insurance, and 1.53% for self-employed pension provisions. The contribution to accident insurance amounts to €10.09 per month, independent of the amount of the contribution base.
The income from commercial operation (revenues minus operational expenditures) according to the applicable income tax assessment plus prescribed contributions to health, pension and voluntary unemployment insurance constitute the contribution base. Since this tax assessment is frequently available only several years later, the contributions are provisionally calculated based on the revenues of the third previous calendar year; once the notice of the income tax assessment is available, it will be corrected in accordance with the current revenues (except the contributions to self-employed pension provisions).
The GSVG stipulates a minimum contribution base. The contributions must be paid, namely of this contribution base, even if the revenues are actually lower than this or if losses have been generated (see our information leaflet “Current values”).
For young entrepreneurs, there are fixed minimum health insurance contributions in the year of foundation and in the following calendar year (no additional payments for higher incomes).
Estimate of the contributions
The contributions are always estimated quarterly for three months. Upon request, a monthly deposit or monthly direct debit is possible. Subsequent payments must be made in four equal quarterly sums in the calendar year following the decision on the final contribution base. For founders, taking into consideration the economic circumstances, the subsequent payment may be apportioned over three years – 12 instalments – after the 3rd year of compulsory insurance under the GSVG on request.
At the request of the insured person, the contribution liability can be reduced or increased on account of the temporary contribution base,
- insofar as he can credibly demonstrate that his revenues in the current calendar year will differ substantially from those of the third previous calendar year, and
- this appears to justify a reduction in accordance with its economic circumstances.
If several gainful activities are pursued (self-employed and employed, self-employed and farming, etc.), special provisions apply. Please also refer to our information leaflet on multiple insurance!