Austria

2012 Tax rates of Austria

Corporate tax

Rate

The standard corporate tax rate of Austria is 25%. Company profits consits of business and trading income, passive income as well as capital gains. Certain business expenses may be deducted in computing taxable income.

Taxation of dividends

Dividends from an Austrian resident corporation, are tax exempt. Portfolio dividends may be tax exempt if the foreign company is listed in the EU parent-subsidiary directive and the participation is les then 10%, or if there is a tax treaty in hand.

Capital gains

Capital gains are taxed at the standard corporate tax rate of 25%.

Losses

Losses can be carried forward indefinitely, but no carrybacks is allowed. The offset for carry forwards are generally offset of 75% of the profits of the given tax year.

Withholding tax

Dividend is taxed at the standard corporate tax rate of 25%, unless the dividends paid is to another Austrian company, which in this turn is tax exempt, or if there is a tax treaty in hand.

In general there is no withholding tax levied on interest, unless it’s a loan secured against an Austrian real estate or certain Austrian rights. Rates can in this turn be exempt or reduced under a tax treaty.

Royalties is taxed on a flat rate of 20%, but it may be reduced or exempt if there is a tax treaty in hand.

 

Individual tax

General

Individuals living or regularly residing, having a domicile status in Austria is considered a resident fo rtax purpose. Individuals are taxed on their worldwide income. Nonresidents are just taxed on their income from Austrian sourced work. Effectively this means that if an individual spends more than 6 months he or she is considered a resident.

Taxable income

Taxable income for an individual is considered to conclude employment, trade or profession, income from private investments.

Rates

Taxable income                      Marginal Tax rate       Effective Tax rate
EUR 0 – 11,000                      0%                                     0%
EUR 11,001 – 25,000          36,5%                               20,44%
EUR 25,001 – 60,000         43,21%                             33,73%
EUR 60,001 – and above   50%

Capital Gains

Capital gains tax is imposed at a rate of one-half of the taxpayer’s average tax rate, up to a maximum of 25%.

Deductions

Deductions from income are available for various losses. Certain special exceptional expenses such as disabled individuals, to farm and forestry workers.

Real Estate

Tax is levied depending upon municipalities and imposes an annual real estate tax rate of up to 2%, on up to 5 times the property value.

Net Worth Tax

There exist no net worth tax in Austria.

Inheritance Tax

In general no, but there is also a statutory notification requirement for gifts.

Social Security

Employed and self employed individuals are required to make pay-related social security contributions in an amount determined based on the individual’s salary.

VAT

VAT applies to all sales of goods, services and imports. The VAT is 20%. A lower rate of 10% is taxed for convenience goods and services such as food, newspapers or public transports. Certain services like as banking, are tax exempt, as well as a zero rate applies to exports.

 

Other

Tax year. Calendar year.

Tax treaties. Austria currently has 90 treaties.

Filing requirements. Tax on employment income is withheld by the employer. Certain types of investment income are not included in the computation of the taxpayer’s income but are taxed at a special 25% withholding tax rate. Other income is self-assessed; the taxpayer must pay advance income tax in 4 instalments. The tax return must be filed by 30 June in the year following the assessment year.

Registration (for VAT purpose). Austrian corporations as well as nonresidents must register for VAT purposes. The threshold is an annual turnover exceeding EUR 30,000.

 

Links

Tax authorities. Revenue offices of the Austrian Ministry of Finance

Consulate

Local Tax Resources

Chamber of commerce

(Online realtor/stock exchange)