Tax In Austria

A Contractor's Guide to Taxes : 

One of the most consistently challenging aspects of contracting in Austria is complying with the country’s tax system. As well as paying tax in Austria, you might also still be eligible to pay some tax in your home country, and understanding the legislation behind this can be a challenge.

How do I calculate my taxable income: 

If you’re working in Austria under a permanent contract, many employers will handle your tax under the PAYE (pay-as-you-earn) system. This means that they calculate and process your taxes in Austria for you and then send you a net wage. Your income tax, public health insurance, social security and other deductions will all be covered by this payment. This is the easiest way to handle your income tax in Austria, but contractors may not be offered this service because of their short stay with each employer.

Anybody who can’t pay their tax in Austria through PAYE is left with the prospect doing everything themselves.

Do you know much about Austrian Tax Law? Does Austria have a tax treaty with your home country? You will need to find out or find someone who can help! Income tax in Austria can range from 0 to 55 percent, and you need to be sure you are placed in the correct tax brackets.

Tax Calculator: 

If you are a contractor and want a calculation on your tax and net retention in Austria, we can supply it to you free of charge.

Using an Umbrella Company for Income Tax : 

Contractors in Austria are faced with masses of paperwork and numerous wasted hours filing a tax return unless they find an alternative option. An Austrian umbrella company can act as your employer during your stay in the country whilst still allowing you the freedom of a contractor. The only difference is that you submit your timesheets to them; they’ll calculate and pay your taxes as you earn, and then you receive a net wage (as well as documentation for your records).

The companies are experts in Austrian taxation, and they’ll ensure that you keep the largest proportion of your earnings whilst complying with local laws. They can deal with any issues with the Austrian tax office or tax department directly including processing your tax refund if you are eligible.

How We Can Help You with Tax: 

We work with numerous umbrella companies in Austria, many of whom are experts in tax and immigration laws. If you have any questions about tax in Austria, we’ll get the answers from them directly so you can rest assured you’ll be getting accurate information. We have comprehensive knowledge of the different services they provide, and can help you find the right company to handle your income tax. We help oil and gas workers, software developers, IT project managers, testers, business analysts and telecommunications contractors get tax efficient payments and sponsorship for their Austrian work permit.

Our advice is 100 percent free, and comes with no obligations. You will be paying taxes in Austria but without the overhead of directly dealing with the Austrian tax authorities. Get in touch with us today for some reliable advice on tax in Austria!

When Do You Need to Lodge Your Tax Return?: 
April 30 (for paper filing); 30 June (for electronic filing)
Tax Filing Deadline : 
April 30 (for paper filing); 30 June (for electronic filing)
Can you file it online? : 
Yes, https://finanzonline.bmf.gv.at/fon/
Currency: 
Euro (EUR)
Tax-free Threshold in: 
EUR11,000
Grossed Income: 
0 - 11,000
Tax Rate: 
0%
Grossed Income: 
>11,000 - 18,000
Tax Rate: 
25%
Grossed Income: 
>18,000 - 31,000
Tax Rate: 
35%
Grossed Income: 
>31,000 - 60,000
Tax Rate: 
42%
Grossed Income: 
>60,000 - 90,000
Tax Rate: 
48%
Grossed Income: 
>90,000 - 1,000,000
Tax Rate: 
50%
Grossed Income: 
>1,000,000
Tax Rate: 
55%
How long does it take to set up: 
21 days
How much does it cost: 
EUR2,032
Is it easy? : 
Starting a Business Rank: 118/190 (Source: World Bank)
How to File Taxes in: 

Individuals for whom employment income is the only source of income, are not obligated to file income tax returns. However, you may do so to obtain a tax refund where you have incurred deductible business or special expenses.

You can file taxes online or by paper.

Step 1: Register for FinanzOnline

Register for the Federal Ministry of Finance’s (Bundesministerium Für Finanzen) online tax filing portal here. You will be required to fill in your personal details, and select a User ID (which must be 8-12 characters in length and contain at least 1 letter and 1 digit).

After successful registration, you will receive your personal ID, user ID, and PIN by registered mail.

If you have a Citizen Card, registration is not required.

Step 2: Login to FinanzOnline

Once you have registered for FinanzOnline, you can log in here. All tax forms can be accessed and completed online. Data from the previous year can be transferred automatically and notifications e.g. tax decisions can be viewed via the electronic Data Box.

Notes: 

Regular Payments and Special Payments

Austrian tax law distinguishes between ‘regular’ payments (which recur on a regular basis e.g. every month), and ‘special’ (non-recurring) payments. Special payments (not exceeding 1/6 of regular payments) are subject to special tax rates.

 Amount (EUR)

 Special Tax Rate

 0 - 620

 0%

 >620 - 25,000

6%

 >25,000 - 50,000

 27%

 >50,000 - 83,333

 35.75%

 >83,333

 Regular Tax Rate Up to 55%

Non-residents: For non-residents, an additional (hypothetical) EUR9,000 is added to their taxable income. 

Deductions: The following deductions apply to income tax.

Traffic allowance

EUR400

Deduction for pensioners

EUR400

Deduction for sole wage earners in a family with a child (if the spouse derives taxable income not exceeding certain limits)

EUR494 (EUR for sole wage earners with 2 children and an additional EUR220 for every additional child)

Commuter deduction

EUR2 per km

Family and Child Allowances 

Tax-free monthly transfer payments are granted for each child entitled to a child allowance (EUR58.40 for each child), and are paid with the family allowance.

Age of Child (Years)

Monthly Family Allowance (EUR)

0-2

111.80

3-9

119.60

10-18

138.80

19+

162.00

The total monthly amount increases with the number of children, at the following amounts:

 

  • 2 children: EUR6.90 per child
  • 3 children: EUR17 per child
  • 4 children: EUR26 per child
  • 5 children: EUR31.40 per child
  • 6 children: EUR35 per child
  • 7 or more children: EUR51 per child

An additional EUR100 is paid in September for children between 6 and 15. 

Does the 183 day rule apply in: 

Yes

When do you become a tax resident in: 

You become a tax resident in Austria when:

  • You establish a permanent place of abode in Austria; or
  • You stay in Austria for at least 183 days.
Am I taxed on my global income in: 

Residents are taxed on their global income. Non-residents are taxed on their Austria-source income only.

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