A huge number of foreigners living in Austria who aren't German speakers will at some stage go on a German course. There are countless options out there, many of them very cheap or even subsidised. The problem is that the cost can still end up being quite considerable.
A frequently asked question from people who have done German classes is whether the costs can be included in their annual Austrian tax return.
A deduction does not mean the Finanzamt will refund the full price of the course. It will reduce your income for the purposes of working out your tax, so the actual saving you make will depend on your income and how much tax you've already paid.
The rules we're looking at here are primarily for employees submitting an Arbeitnehmerveranlagung (employee tax assessment). The self-employed have a completely different set of rules which we'll look at below.
When are German courses tax-deductible?
According to Austria's Finance Ministry, employees can claim education costs as Werbungskosten, or income-related expenses, when the course is professional development in their current occupation, training for a related occupation or comprehensive retraining for a new career.
Courses taken purely for private reasons are not deductible.
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The same applies to language courses. They can be seen as professional training if the language skills are required for your current or related profession.
German is used extensively in the Austrian workplace so it's very possible that many of the staff would be able to demonstrate a genuine professional requirement for the language. That said the inference isn't necessarily valid.
The tax authorities may look at whether the language skills are actually of any use to you in your current job or in your qualifying professional training.
The Finance Ministry speaks of "acquisition of a foreign language" in its guidance, but also makes it perfectly clear that German can be classed as a foreign language if it's not the person's mother tongue.
Depending on the circumstances, deductible education expenses can include the course fee, course materials and other directly related costs.
You can only claim the amount you actually paid yourself. If you received a grant, subsidy or reimbursement of any kind towards the course then this must be subtracted from the amount you enter on your tax return.
How do I go about claiming my German course in Austria?
Employees can claim their eligible German course expenses when submitting their annual Arbeitnehmerveranlagung via Austria's FinanzOnline.
The expenses count as Werbungskosten in the category for education, professional development, and retraining (Aus- und Fortbildung, Umschulung).
Alternatively employees can complete the paper L1 tax form.
You should enter the eligible expenses you have paid yourself having deducted any relevant subsidies or reimbursements.
If you're completing a voluntary employee tax assessment, Austria will generally permit you five years from the end of the relevant tax year to do so.
For example, you can still submit a voluntary assessment for 2025 until 31st December 2030. Different deadlines apply to the mandatory returns.
You should also keep your course invoices, your payment confirmations and any documentation that shows the link between the lessons and your work for a period of seven years in the event that the Finanzamt should ask for them.
What if I go for a language course?
If you take a language course abroad you can still claim the course fee if the language is required for your profession.
But the guidance from the Finance Ministry is that the cost of travel and accommodation for language training overseas is not deductible.
This is distinctly different from a qualifying professional study trip where travel expenses could be recognised under a completely different and more stringent set of rules. The rules that apply to study trips shouldn't be automatically extended to a language course abroad.
What if I'm self-employed in Austria?
Self-employed people can also claim the cost of qualifying German courses where those courses are genuinely connected to their business.
However, the rules are different for staff.
Instead of Werbungskosten, the expenses are treated as business costs (Betriebsausgaben) and whether or not they can be deducted separately may well depend on how the individual calculates their taxable profits.
For instance some of the flat rate expense arrangements (Pauschalierung) will already include training costs in the general allowance, so they can't necessarily be claimed again.
Self-employed people should check which of their expenses are allowable under their method of calculating taxable profits before they go on to include German lessons.
The WKO (Austrian Economic Chamber) have more information on deductible business expenses.
READ ALSO: What foreigners in Austria should know about taxes
As with all tax issues eligibility is going to turn on your individual circumstances, particularly on how the course relates to your profession. If in any doubt as to whether your German lessons qualify then it may be worth getting professional tax advice.
Do you have any questions regarding filing your taxes in Austria? Let us know in the comments below.
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