On September 19th, the Tax Reform Act 2020, the Tax Modification Act 2020 and the Financial Organizational Reform Act (FORG) has been passed by the Austrian parliament. Here are some important highlights of the new regulations. Most changes will be effective from January 1st, 2020.
Increasing the limit for low-value assets (“geringwertige Wirtschaftsgüter”)
Increase of the acquisition cost from € 400 to € 800.
New option for expense lump sum for small business owners
- Sales below € 35,000 p.a.
- Business expenses flat rate: 45% of sales + social security contributions
- For service companies: 20% of turnover + social security contributions
Wage tax deduction for foreign employers
Even without the existence of a payroll branch it is obligatory for employees with unlimited tax liability to deduct wage tax from January 1st, 2020. For employees with limited tax liability the possibility of voluntary tax deduction is now determined by law.
Limited taxable persons are now also obliged to file a tax return if they simultaneously have several employment contracts in Austria or if other income subject to tax assessment is received which exceeds € 730 p.a.
Value Added Tax
- Increase of small entrepreneur limit to € 35,000
- Deliveries of electronic books are subject to the reduced rate of 10%
- E-bikes and e-motorcycles will be treated as e-cars for input-VAT if used by entrepreneurs
- Regulations for “Reihengeschäft”
- Regulations for consignment warehouses (Konsignationslager)
Abolition of the “own” electricity tax for photovoltaic plants
Total exemption from the “own” electricity tax (production of electricity for own consumption) by means of photovoltaic system on roofs, facades, noise barriers etc.
Liability for information of online platforms
Online platforms should record relevant information of the rendered services and pass this information to the Austrian tax authority. The platform may be liable for nontaxation of customers.
Introduction of a digital tax on online advertising for large digital companies
Introduction of an Austrian digital tax of 5% on online advertising for large companies.
EU mandatory reporting law
Obligation of tax payers/companies to inform about certain international tax models to the Austrian financial authorities.
Financial Organization Reform Act (FORG)
The Financial Organization Reform Act is the legal framework in order to reorganize the Austrian tax and customs administration. Instead of the currently existing 50 offices and organizational units (z. B. Finanzämter), a new nationwide responsibility will be stated:
- the tax office Austria,
- the customs office Austria,
- the tax office for large enterprises,
- the Anti-Fraud Office and
- the inspection service for wage-related duties and contributions.
The former tax offices (“Finanzämter”) become "Dienststellen".
Vienna, October 2019