An agency company is a company that has an agreement with an offshore company (principal) on the activities of an agent. The agency company itself is not established in Austria but earns income from the agency commission.
At all stages, the agency company is doing business on clients behalf who, under the terms of the agency agreement, can be a tax haven company. Business transactions are made through an Austrian company and the proceeds are credited to its bank account. After deduction of the commission, the amount of capital is transferred to the account of the real seller (eg EU company). Agency fees can be set at 2%, 5% or even more and are usually paid annually. The Austrian company will declare the commission received as taxable income in Austria.
Austria as a whole is not hostile to low tax territories and does not impose strict restrictions on doing business with tax havens. However, the jurisdictions which have signed double taxation treaties with Austria are preferred to agencies. For example, an agreement between a UAE company and an Austrian agent is subject to the Austrian tax treaty with the UAE.
Hong Kong Limited or Singapore Pte, like many other companies in jurisdictions other than tax, havens, are also good options for such structures. In any case, all agency structures should be covered by a thorough and detailed agency agreement.
