The α-Al2O3 surface is a widely studied system as it hosts a range of important technological applications such as catalysis, and natural occurring processes such as corrosion. Oxygen vacancies near the surface of α-Al2O3 (0001) are of significant interest as they aid in understanding the hydration of the surface which is critical to the aforementioned processes. Employing first-principles calculations, we investigated the α-Al2O3 (0001) surface with Al-termination to study the surface effects on electronic and structural properties. Starting with the PBEsol exchange-correlation functional to relax the atomic positions, we observe a decrease in the direct band gap from 5.98 eV (bulk) to 4.90 eV (surface), accompanied by the reconstruction of the surface Al ions. The vertical relaxation is maximum for the surface Al layer (inwards by ~88% of the unrelaxed configuration) wherein the Al ions are almost in the same layer as the subsequent O layer, and the displacements of the subsequent layers are concurrent with previous density-functional theory studies and experimental results from X-ray diffraction. Upon introducing the O-defect, a further reduction in the band gap and emergence of defect levels is observed. These defect states are characterized to describe an active space for a subsequent quantum embedding approach.