Austria: Business Environment
A reduced rate of 13% applies to entrance fees for sporting events, entrance fees for cultural events, domestic flights, animal feed, seeds, supplies made by artists, certain wine sales made by the producer.
For depreciation and amortisation, only the straight-line method is accepted, with the cost evenly spread over the useful life of an asset (with some exceptions like buildings and automobiles).
Tax losses can be carried forward without any time limit (within a limit of 75% of the taxable income for any given year, with some exceptions). The carryback of tax losses is generally not permitted.
Local authorities annually levy real estate tax on all Austrian property, based on its assessed standard ratable value (Einheitswert), which is typically below market value. The effective tax rate depends on the property's use and is calculated using a special multiplier. Agricultural and forestry land is taxed at 0.16% for the first EUR 3,650 and 0.2% thereafter. Buildings and property are taxed at 0.2%, with reductions for single-family houses (0.05% for the first EUR 3,650 and 0.1% for the next EUR 7,300) and leasehold/shared property (0.1% for the first EUR 3,650 and 0.15% for the next EUR 3,650). Other properties are taxed at 0.1% for the first EUR 3,650. The final tax is determined by applying a municipal rate (up to 500%), reduced by 25%, and increased by a 35% inflation adjustment.
For real estate transfers within close family circles, tax is based on three times the assessed ratable value (up to 30% of fair market value) at a 2% rate. Corporate restructuring under the Reorganisation Tax Act uses twice the assessed standard ratable value with a standard tax rate. Free-of-charge transfers, both familial and non-familial, are taxed based on property value, with rates varying: 0.5% for values under EUR 250,000, 2% up to EUR 400,000, and 3.5% over EUR 400,000. Business transfers are capped at 0.5% of property value. Transactions under corporate restructuring and share consolidation incur a 0.5% tax. Real estate transactions below EUR 1,100 in value are exempt from tax. An additional 1.1% registration fee becomes due upon incorporation of the ownership change in the land register.
Both Austrian banks and foreign banks with an Austrian branch are subject to a banking tax at a rate of 0.024% (assessment bases between EUR 300 million and EUR 20 billion) to 0.029% (beyond EUR 20 billion) of the tax base.
A digital services tax ("Digitalsteuer") applies at a rate of 5% to multinational companies with worldwide revenue of at least EUR 750 million and yearly domestic revenue of at least EUR 25 million from providing online advertising services.
Social security contributions paid by the employer amount to a total of 20.98% (maximum assessment basis of EUR 6,060/month), so divided:
- Sickness: 3.78%
- Unemployment: 2.95%
- Pension: 12.55%
- Accident: 1.10%
- Miscellaneous: 0.60%
Furthermore, the employer is liable to the Family Burdens Equalisation Levy at the rate of 3.9% (3.7% from 2025), the municipal tax on payroll at the rate of 3% of monthly gross salaries and wages, and a public transportation levy equal to EUR 2 per week/employee in the city of Vienna. A contribution to the Chamber of Commerce is levied at a rate between 0.32% and 0.42% of monthly gross salaries paid, according to the province. Local authorities also levy other taxes, for example, on rubbish collection and on entertainment.
Austria | OECD | United States | Germany | |
Number of Payments of Taxes per Year | 12.0 | 10.1 | 10.6 | 9.0 |
Time Taken For Administrative Formalities (Hours) | 131.0 | 163.6 | 175.0 | 218.0 |
Total Share of Taxes (% of Profit) | 51.4 | 41.6 | 36.6 | 48.8 |
Source: Doing Business, Latest available data.
Personal Income Tax (EUR) | Rate (%) |
0 - 12,465 | 0 |
12,465 - 20,397 | 20 |
20,397 - 34,192 | 30 |
34,192 - 66,178 | 40 |
66,178 - 99,266 | 48 |
99,266 - 1,000,000 | 50 |
Above 1,000,000 | 55 |
A sole earner credit applies to married couples with a single income and children. If they receive family allowance for over six months, the monthly tax withheld decreases: by EUR 46.25 with one child, EUR 62.58 with two, and EUR 83.25 with three. Couples without children don't qualify for this credit. | |
Special Payments (13th or 14th month salary or bonus) | ranging from 6% to 55% (first EUR 620 is tax-free) |
Tax relief is provided for taxpayers who incur extraordinary expenses (e.g. funeral costs, medical expenses for special treatments not reimbursed by health insurance), with limits depending on the income and family status (with a retention rate ranging from 6% to 12%).
Personal allowances generally take the form of tax credits and include a transportation tax credit (EUR 449 as of 2024) and for sole wage earners, single taxpayers, and sole earners of unmarried couples EUR 555 with one child, EUR 751 with two children, EUR 248 for each additional child.
A monthly tax-free cash payment for children up to age 18 or up to 24 if still in school, or handicapped (up to age 25 under certain conditions), is granted by the government upon formal request. Different monthly allowances are eligible for children based on their age and circumstances: EUR 132.30 per month for kids below three years old, and EUR 141.50 per month for those between the ages of three and ten. For children aged between ten and 18 years old, the monthly allowance is EUR 164.20. For orphans and students between 19 and 24 years old (25 in certain situations) the monthly allowance stands at EUR 191.60. Furthermore, a child care allowance (Kinderbetreuungsgeld) is granted for newborn children.
Morover, a family bonus plus is available. It consists of a tax credit that reduces tax payments. Parents can claim an annual tax credit of EUR 2,000 per child up to 18 years old, residing in Austria and eligible for family allowance. If both parents claim it, each is entitled to 50% of the tax-free amount (EUR 1,000 annually). For children aged 19 to 24 (and sometimes up to 25), the bonus can be up to EUR 650 per year.
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Latest Update: November 2024