HFU list in subcontracting: construction company social contribution liability

The provision covers the passing on of construction services under section 19(1a) of the 1994 VAT Act from one company to another company. The ordering company is liable for contributions and levies which the contractor must pay to Austrian health insurance institutions or for which it is liable under this provision.

Liability arises when the remuneration is paid. It covers contributions and levies that become due by the end of the calendar month in which the remuneration is paid. Remuneration means the entire consideration due for the order. Instalment payments and performance by set-off can also count as payment of the remuneration.

The liability can be asserted under the statutory conditions where enforcement against the contractor has been unsuccessful or an insolvency fact under sec. 1 IESG exists. The liability provision therefore requires a review of the specific commission and payment process.

Liability under sec. 67a(1) ASVG is excluded where the contractor is listed in the HFU master list under sec. 67b(6) ASVG at the time the remuneration is paid. The inquiry must therefore be assigned to the correct contractor and the specific payment.

The relevant time is the time when the remuneration is performed. This is generally the calendar day on which the decisive legal act for satisfying the remuneration debt is taken. The ordering company must prove that time. An electronic inquiry made on the preceding day may exceptionally be relevant where same-day issuing of the payment order was impossible or unreasonable.

A careful payment file contains the contractor, the order, the remuneration, the payment order and the saved HFU inquiry. The documents should show which list was checked and at what time.

If the contractor is not listed in the HFU master list, the ordering company can transfer the liability amount to the Dienstleistungszentrum at the same time as paying the remuneration. The amount is 20 percent of the remuneration due. Where the service is performed as hiring out of workers, 32 percent applies.

The transfer record or electronic transfer must contain the reference “AGH”. It must state the employer number of the ordering company or, if there is none, its company name and address. Depending on the case, the contractor must be identified by VAT identification number, tax number, employer number, an insurance number with the suffix “v” for persons under sec. 67e ASVG, or the company name. The date and number of the remuneration invoice must also be included.

Payment to the Dienstleistungszentrum discharges the ordering company towards the contractor. It is treated as performance by a third party. The payment evidence should therefore remain connected with the invoice, order and service classification.

Ordering companies must truthfully inform the health insurance institutions within 14 days about commissioned companies and construction services passed on. Where the information is not provided, the company can be treated as the ordering company for subsequently commissioned companies for as long as the required information is missing. A proven exemption ground remains relevant.

Companies applying for inclusion in the HFU list, listed there or concerned by liability amounts paid by ordering companies must also provide truthful information and relevant documents within 14 days. Where the health insurance institution has doubts about the information or documents, it may require original documents.

During business hours, properly identified staff of the health insurance institutions must be given access to business books, records and other documents relevant to the liability. An orderly file makes such requests easier to answer.

Liability can extend to a further commissioned company where the commission is an evasion transaction intended to avoid liability. The ordering company must have known of the purpose or, because of obvious indications, have seriously considered it possible and accepted it.

Where there are indications of such an arrangement, health insurance institutions can request information about the construction services passed on. The ordering company must provide that information within 14 days if the contractor does not provide it within the same period.

In practice, a chain of subcontracting should remain traceable by contractor, construction service, payment flow and responsibility. Unclear intermediate steps increase the evidentiary risk.

First classify the specific service. Record which company takes over which construction service and whether the actual organisation indicates hiring out of workers. This classification determines the possible liability rate.

Then check the HFU status at the relevant payment time or prepare the exemption payment. Each instalment requires its own assignment. Keep the evidence so that contractor, invoice, remuneration and payment route match without later reconstruction.

A further assessment is useful where contractors change, several subcontractors are involved, payment is made by set-off or the HFU inquiry and payment order differ in time. Contract terms in consumer construction contracts form a separate topic. The article Consumer construction contracts: invalid clauses and real risk points addresses it.