Page 11 - CEE Tax Guide 2025

The harmonized EU-VAT-system applies. The Investment income (e.g. interest, dividends, capital
general rate for the sale of goods and services gains from investments) is generally subject
is 20%. Reduced rates of 10% or 13% apply, for to a separate tax rate of 27.5%. Capital gains from
example, to agriculture products, real estate rentals real estate are subject to a tax rate of 30%.
with a residential purpose, entertainment, and Certain private expenses are deductible
art. Many exemptions are in place (e.g. exports, under various conditions (e.g. donations
interest, insurance premiums, sale of real estate). to charities, churches, tax advisory fees, tax losses
Entrepreneurs with annual sales not exceeding carried forward).
EUR 55,000 are exempt from VAT obligations.
Non-residents trading in Austria (B2C) are subject Partnerships are not subject to income tax
to registration immediately, unless they apply themselves. Their profit is subject to either
the OSS system (central VAT compliance in their income tax or corporate income tax at the level
EU-home country). Monthly/quarterly returns of the partners.
are filed electronically, and annual returns must A compulsory public social security system
be completed by June 30 of the following year. is in place in Austria.
Companies represented by a tax advisor can have
the deadline extended substantially. Social security contributions for employees are
partly borne by the employee and partly by the
Excise for certain alcoholic drinks (e.g. wine, beer),
natural gas, oil, coal, etc., in line with the EU system. employer. The base is the gross salary and benefits.
A maximum contribution base of EUR 90,300 per
Personal income tax / year applies for 2025. Social security contributions
amount to 39.05% (18.07% employee and 20.98%
Social security system employer). Additionally, employers are obliged
to pay other payroll-related costs amounting
According to the domestic tax law, individuals are
deemed to be tax resident in Austria if they have to approximately 8.6%.
their residence or habitual abode in Austria. In this For self-employed persons, the same maximum
case, the individual’s global income is subject contribution base is used (EUR 90,300 per
to Austrian income tax. Other individuals are subject year for 2025).
to tax on income from their Austrian sources.
Social security contributions amount to 26.83%.
The term income is specified in the Income Tax This insurance covers health, pension, and accident
Act. Tax rates are progressive from 0% (for yearly insurance. For the first 3 years, lower contribution
income up to EUR 13,308) to 55% (for yearly income bases are applicable.
exceeding EUR 1,000,000). Certain allowances are No social security contributions are due for income
available depending on the taxpayer’s family status. not exceeding EUR 551.10 per month.
Income tax on wages is withheld and directly paid
to the tax office by the employer.

Wage related taxes in Austria Minimum wage Average wage in private sector

in EUR in EUR
2,378 5,009
Total wage cost 3,070 129.00% 6,469 129.00%
Employer’s social security contributions and other 692.82 29.00% 1,459.67 29.00%
payroll taxes

Gross salary 2,378 100.00% 5,009 100.00%
Employee’s social security contributions 356.11 15.00% 898.05 18.00%
Wage tax 95.79 4.00% 694.11 14.00%
Net salary 1,926 81.00% 3,417 68.00%

Florian Würth
Partner – Tax Advisor – CPA
Phone: +43 1 531 74-780
E-mail: florian.wuerth@forvismazars.com

Central and Eastern European tax guide 2025 Forvis Mazars 11