Everything you need to know about paying tax in Austria

Income tax

In Austria you will be taxed progressively on your income, whether you are self employed or employed by a firm. Some future changes to taxation are being planned for upcoming years. Income is only taxed when it exceeds €11,000 per year.

Income from	Income until	Tax rate (current)	Tax rate (new)
€ 0,-	€ 11.000,-	0%	0%
€ 11.000,-	€ 18.000,-	20%	20%
€ 18.000,-	€ 31.000,-	35%	30%
€ 31.000,-	€ 60.000,-	42%	40%
€ 60.000,-	€ 90.000,-	48%	48%
€ 90.000,-	€ 1.000.000,-	50%	50%
€ 1.000.000,-		55%	55%

The tax year

The tax year in Austria starts 1st January, unlike in some other countries such as the UK, where it runs from 1st April.

Tax returns should be filed by the end of June for the previous year if you are filing tax online. 

However, if you employ a tax adviser the deadline for tax returns can be extended to February. 

A one-time meeting with a tax advisor to create a tax declaration usually costs between €120 and €200, but obviously if your business is more complicated it may cost more. 

Most self-employed people in Austria do employ a tax advisor, as there are many complicated rules and exceptions. 

SVS

If you are self-employed in Austria, once your income exceeds €5,710.32 annually, you must also pay compulsory health and social insurance SVS (also known as SVA).

Social security contributions are tax-deductible in Austria.

Being employed in Austria

Taxes in Austria may seem high at first. For example, a person earning around €18,000 per year could probably expect to pay €1,400 of tax on €7,000 of taxable income.

However, there are many benefits to working in Austria. Excellent healthcare and also two months of extra “bonus payments” per year, normally before Christmas and in May.

These payments are taxed at 6 per cent. 

There are also many tax deductible benefits depending on your employer. 

If you are employed by a company, they will take care of your social and health insurance through the Österreichische Gesundheitskasse (ÖGK). 

Becoming self-employed in Austria

Identifying the right type of self-employment is the first step to becoming a freelancer in Austria, and there are four different categories:

• New self-employed (Neue Selbständige)
• Liberal professional (Freiberufler)
• Self-employed with a free or regulated business licence (Freie/ Reglementierte Gewerbe)
• Independent contractors (Freie Dienstnehmer).

Business registration can be done at the Wirtschaftskammer Österreich (WKÖ), or the Austrian Federal Economic Chamber. This is also somewhere you may be able to get help with someone who speaks English. 

There is an annual WKÖ fee of €100, plus annual business fees and tourism tax to pay as a freelancer.

Essential websites

Social insurance: sozialversicherung.at

ÖGK: gesundheitskasse.at

WKO: wko.at

SVS (for self-employed insurance): svs.at

NOTE: This article is only a guide to some of the more common rules and procedures associated with paying tax in Austria. It is not intended to serve as legal advice. Have we gotten something wrong? Get in touch at [email protected].