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EXPLAINED: The tax benefits that parents and families receive in Austria

Amanda Previdelli
Amanda Previdelli - [email protected]
EXPLAINED: The tax benefits that parents and families receive in Austria
Pictured is a person filling out tax information. Photo by Mikhail Nilov: https://www.pexels.com/photo/two-people-doing-paperwork-and-computing-taxes-6963053/

Austria's social system is financed by its heavy tax burden, but certain benefits are meant to help parents and families ease those costs.

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Raising a family can be expensive - particularly in years of rising inflation costs, and parents still need to deal with high tax expenses in a country like Austria, where the social system is strongly based on these payments. 

However, the government offers various tax benefits to help ease the financial burden for parents and families. Understanding these benefits can have a tangible impact on households every year.

Here are the key tax advantages available to support families in Austria. All numbers are 2024 values as they are adjusted for inflation yearly.

READ ALSO: Why it's worth filling in your annual tax return in Austria

Family Bonus Plus and multi-child supplement

The Family Bonus Plus (Familienbonus Plus) is a deductible amount that can provide a tax credit of up to € 2,000.16 per child (or up to €650.16 for a child older than 18). The basic prerequisite is that you or your partner receive a family allowance (Familienbeihilfe) for the child. 

You can split the tax bonus with your partner. It's recommended that you check with your partner about the best way to split it so you can benefit from the tax relief to the fullest. You can also decide how each child's bonus is divided up. 

If you pay no or very little income tax, you may receive the additional child allowance of up to €550 per child and calendar year instead of the tax benefit. 

The multi-child supplement (Mehrkindzuschlag) is a tax benefit that people with three kids or more might receive of €21.20 per month and per child, provided the family income was less than €55,000 in the previous year.

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Relief for sole-earners

The benefit called Entlastung für Alleinverdienende exists for families in which at least one parent earns a low income and then can receive the sole earner deductions, which increase with the number of children. To be eligible, you must be entitled to the Familienbeihilfe for at least six months, married or cohabited for at least six months, and your partner’s income totalled a maximum of €6,312 in the year.

Not every payment counts towards that amount, so, for example, tax-free special payments (such as overtime or night work) and childcare allowance (Kinderbetreuungsgeld) don’t count. The amount of the tax cut depends on how many children you have (and they must've received Familienbeihilfe for at least six months that year). For one child, the benefit is €520; for two, it is €704, and there is a €232 tax relief for each one. 

READ ALSO: Taxes, benefits and price increases - the money changes in Austria in 2024

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Relief for single parents

If you live alone with your children, you are entitled to the single-parent deduction (Entlastung für Alleinerziehende or AEAB). This amount is deducted from your tax for each child for whom you are entitled to the Familienbeihilfe for more than six months in a calendar year. To be entitled to it, you also cannot have been in a valid marriage, registered partnership or cohabitation for more than six months in the tax year.

The tax credit amount depends on how many children you have. For one child, the benefit is €520; for two, it is €704, and there is a €232 tax relief for each one. 

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Relief for child support providers

If your children don't live with you but you pay mandatory maintenance (child support), these payments are taken into account with the relief for the maintenance provider's benefit (Entlastung für Unterhaltsleistende or UHAB). 

This tax credit requires that your children do not live with you but live in Austria, the EU, an EEA state or Switzerland. You also cannot be entitled to the family allowance for these children and demonstrably pay child support for them.

If you provide maintenance for a child who lives in a third country, you are not entitled to UHAB, but you can claim these payments as an "extraordinary burden" in your tax assessment. 

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How can I claim these benefits?

If you don't already have them claimed via your employer (which would show in your monthly payslip), you can claim them by doing your yearly tax assessment. The easiest way is to do it online via the FinanzOnline portal. 

However, you can also reach out to any office of the Austrian tax office to obtain the necessary forms and then send them filled by the post office.

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