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MOVING TO AUSTRIA

Reader question: Do I need to open a local bank account when moving to Austria?

If you are moving to Austria, can you keep using your home country's bank account or open an international one online, or should you really have an Austrian one?

Reader question: Do I need to open a local bank account when moving to Austria?
Online bank accounts are one of the things that make life easier for expats (Photo by rupixen.com on Unsplash)

One of the first issues people face when moving into a new country is whether or not to open a new bank account in their new country or if they can use either their home accounts or international online accounts.

Even long-term foreign residents started asking similar questions once new companies started offering online bank accounts that were not necessarily based in Austria, but could be opened by any resident in the alpine country

READ ALSO: 23 essential articles to help you navigate life in Austria

These online bank options are great choices for foreign residents. They are simple to use, have websites and apps in several languages, and usually offer a free option, with no monthly fees regardless of income. Unfortunately, however, none of the major ones (N26, Revolut, or Wise) have accounts with local Austrian IBANs (International Bank Account Number).

Does it make a difference? For example, can people keep or open an international bank account while living in Austria, or do they have to open an account in a local bank?

Non-EU bank accounts

It makes a huge difference depending on whether your bank account is from an EU country. However, in all circumstances, you are allowed to keep the account open, have money in it and make transactions using it.

It is just necessary to remember that Austria taxes your universal income if you are a tax resident in the country. So any income or relevant transaction should be added to your yearly tax returns.

READ ALSO: Anmeldebescheinigung: How to get Austria’s crucial residence document

Still, keeping only a bank account outside the European Union and living in Austria will be next to impossible. Of course, it’s impractical when thinking about currency exchange, but most establishments and organisations will also not accept transfers from outside of the EU or make them.

So whether you want to pay for your rent or receive government assistance, it’s unlikely you’ll be allowed to do it via an international (non-EU) transaction.

What about an EU account?

Technically, having only a euro (but not Austrian) account is possible. The Single Euro Payments Area (SEPA) is a European Union initiative to simplify bank transfers. All 27 EU members are a part of it, plus other countries, including the United Kingdom, Norway, and Switzerland.

The system allows for fast and secure transfers between the SEPA countries.

One of the agreement’s goals is to extend the freedom of movement in the European Union, allowing its residents to keep a single euro-denominated bank account and a single set of payment instruments.

READ ALSO: EXPLAINED: How to get your €500 Kurzarbeit bonus in Austria

So, you can use your bank account in a eurozone country for everything, including receiving salaries and buying things, in Austria. This is why international and online banks such as Wise or N26 have their IBANs based in Belgium, Germany or Denmark but can be used all over the eurozone.

Does it work in practice?

In practice, though, there is something known as “IBAN discrimination“. This is when an employer or company refuses to accept your SEPA IBAN for euro payments or direct debits. This is illegal under the SEPA agreement but happens often.

It’s not uncommon to find stories of people who have tried to sign up for a service or utility, such as paying for a mobile plan, for example, but were denied because their IBAN identification, though it was from a euro country, did not start with AT – was not from Austria.

For example, on various Facebook groups of immigrants in Austria, it is easy to find people who had their payments denied because their bank accounts weren’t Austrian. “Always ask your employer if they accept your bank account. I had one that especially wanted an Austrian IBAN”, wrote one foreign resident.

What should I do then?

Since not accepting a SEPA bank account is illegal, you can complain directly to the company or employer. In some cases, simply mentioning that IBAN discrimination violates the SEPA agreement and showing the official documents (including article 9 of the SEPA agreement) is enough to solve issues.

However, it can get more complicated than that. For example, some outdated company systems won’t allow new customers or employees to be registered with a bank account from abroad – the “AT” option comes pre-filled and can’t be changed.

READ ALSO: What you need to know about opening a bank account in Austria

Or it may be simply too tricky to talk in German to the utility provider to explain SEPA rules or demand something from your new employer. It’s essential to know your rights, and in Austria, you can also file a complaint with the competent national authority, the Financial Market Authority (FMA).

Other things can be tried in the meantime. In some cases, for example, some gym memberships are possible to sign up to and pay upfront with cash. Another workaround is to use the bank account of a partner or someone you trust. Finally, there are many utility companies in Austria, so if one phone company won’t accept your IBAN, maybe another will.

Of course, these solutions are far from perfect but may allow you to keep your non-Austrian or international euro account.

If the headache is just too much to handle, or if you prefer the advantages of having a local bank where you can visit, you can also open an Austrian bank account and keep both.

Here is our guide on what you need to know about opening a bank account in Austria.

Member comments

  1. I hate to be picky, but N26, Revolut, or Wise are not banks, that’s why they have no IBANs.

    Nevertheless, Wise, from personal experience, is very useful and cheaper than any bank I know for moving money around, particularly with currency exchange (no, they don’t pay me to say that).

    1. Hi!

      What do you mean they are not banks? N26, for example, has had a licence for years and shows up in ECB’s list of supervised banks (though down there where the “less significant banks” are). Is there another place where I can check?

      I’ve also had good experiences with Wise (and N26 for that matter). I haven’t tried Revolut yet, but know of some people who have and use it as their main bank here in Austria.

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For members

LIVING IN AUSTRIA

How much do you need to earn for a good life in Austria?

Austria is known as a country with a high standard of living, but it also comes with a high cost of living. Here’s an overview of what you can expect to earn in Austria.

How much do you need to earn for a good life in Austria?

As with most things in Austria, the question of ‘what is a good salary?’ is difficult to answer as the cost of living (and wages) can vary between states and cities.

For example, the east of Austria is typically much cheaper than the west for housing (with the exception of Vienna). And those living in cities often have easier – and cheaper – access to public transport when compared with people living in rural areas. 

READ ALSO: ‘Bad-tempered locals’: Vienna ranked the world’s ‘unfriendliest city’

Childcare is also something to consider with huge differences between Vienna, where there is access to heavily subsidised services, and places like Tyrol where childcare costs more.

To delve a bit deeper, we looked at the data to find out the average salary in Austria and how it differs between professions and locations.

What is the average salary in Austria?

In 2021, the average gross annual salary in Austria was €44,395, according to the latest data from Statistics Austria

However, in the latest survey by online job platform Step Stone, the average gross annual salary in Austria is €49,609.

The Step Stone survey then broke it down further by industry with those working in pharma earning the most at €60,504. This was followed by energy at €60,345, medical technology at €59,106 and banking at €58,711.

The industry with the lowest average annual salary is hotels/gastronomy at €37,546, followed by agriculture at €39,779 and tourism at €43,965.

FOR MEMBERS: REVEALED: The best and worst districts to live in Vienna (as voted for by you)

Occupation also plays a part with people working in management earning the most – on average €66,768. Consulting came second at €53,721.

And like many other European countries, the gender pay gap in Austria prevails. The average annual salary for a man is €52,633 and for a woman it is €44,330.

Furthermore, the top earning city in Austria is Bregenz in Vorarlberg with an average annual salary of €54,620. When comparing the west of Austria with the east, the median salary in Vorarlberg is €46,450, whereas in Burgenland it is just €39,100.

What is the average cost of living in Austria?

Many international residents will find everyday living costs in Austria to be expensive, especially for those that come from countries with a much lower cost of living.

Inflation has also been rising steadily in Austria throughout 2022, leading to some steep rises in prices for groceries, housing costs and energy.

READ MORE: EXPLAINED: 10 ways to save money on your groceries in Austria

However, the average cost of living varies across the country, depending on the location. For example, Vienna and Innsbruck in Tyrol are two of Austria’s most expensive cities, but more affordable places to live are Graz in Styria and Klagenfurt in Carinthia.

In Vienna, the average price for a one bedroom apartment in the city centre is €915, going up to €2,000 for a three bedroom apartment, according to Expat Arrivals.

Whereas in Graz, the average cost of a one bedroom city centre apartment is around €609, and a three bedroom apartment is €1,170.

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