We have summarized the following changes in the Austrian taxation legislation for you. Please contact us if you need any more details.
Retroactive reduction of the income tax rate
For an annual income between EUR 11,000 and EUR 18,000 the tax rate has been reduced from 25% to 20% from January 1, 2020. For self-employed persons this will be effective in the tax return 2020 for the first time. For employees with their salaries this change will be considered by “rolling” the previous months no later than September 30, 2020.
Child bonus and school entry fee
In September - in addition to the family allowance - a one time child benefit of EUR 360 per child and a school entry allowance of EUR 100 per child will be paid out.
Purchases made after July 1, 2020 can be depreciated using the degressive method
To strengthen the Austrian economy a declining balance depreciation will be allowed starting with 2020. Declining balance depreciation means that different annual depreciations can be claimed over the period of depreciation of an asset. E. g. in the first years a maximum of 30% of the acquisition cost and in the last 3 years a identical depreciation amount.
Special regulations for buildings
An accelerated depreciation applies to newly acquired or constructed buildings after June 30, 2020, e.g. 4.5% when renting an apartment (3 times the value of the present percentage).
Sales tax rate 5% for tourism, books and culture
The sales tax rate has been reduced to 5% concerning tourism, books and culture from July 1, 2020 to December 31, 2020.
Entertainment costs in connection with entertainment of business friends (“Bewirtungskosten”) from July 1 to December 31, 2020: 75% of the entertainment costs will be income tax deductible, before 50%.
The maximum limits for meal vouchers have been raised: EUR 8.00 (vouchers that can be redeemed at work or in a restaurant) or EUR 2.00 (vouchers that can also be used to pay for food). This regulation applies without a time limit.
Change in the delivery threshold
The delivery thresholds will be abolished across the EU on July 1, 2021. From this point in time sales tax has to be applied for deliveries directly to consumers and threshold buyers in the country of destination. Instead of registering in each individual member state there will be the option of declaring all these sales via a single EU one-stop shop using Finanz-Online.
Non-compensable losses from 2020 up to an amount of EUR 5 million can be compensated with the positive income from 2019 (possibly also 2018).
Extension of short-time work
The currently applicable Corona short-time work (phase 2) will be continued for all companies until September 30, 2020. Thereafter the Corona short-time work will be extended for a further six months from October 1, 2020 to March 31, 2021 (phase 3). An extension by a further six months from April 1, 2021 will be necessary due to the particular impact in certain industries and should be initiated in good time. For more details, please see:
Vienna, August 2020