This paper is devoted to a practical model for relativistic reduction of positional observations with an accuracy of 1 \mu as which is expected to be attained in the future space astrometry missions .
All relativistic effects which are caused by the gravitational field of the Solar system and which are of practical importance for this accuracy level are thoroughly calculated and discussed .
The model includes relativistic modeling of the motion of observer , modeling of relativistic aberration and gravitational light deflection as well as a relativistic treatment of parallax and proper motion suitable for the accuracy of 1 \mu as .
The model is formulated both for remote sources ( stars , quasars , etc . )
and for Solar system objects ( asteroids , etc . ) .
The suggested model is formulated within the framework of Parametrized Post-Newtonian Formalism with parameters \beta and \gamma .
However , for general relativity ( \beta = \gamma = 1 ) the model is fully compatible with the IAU Resolutions ( 2000 ) on relativity in celestial mechanics , astrometry and metrology .
The model is presented in a form suitable for implementation in a software system for data processing or simulation .
The changes which should be applied to the model to attain the accuracy of 0.1 \mu as are reviewed .
Potentially important relativistic effects caused by additional gravitational fields which are generated outside of the Solar system are also briefly discussed .