Austria

Employment expenses

Expenses incurred in ‘acquiring, securing, and maintaining’ income are deductible from the taxable income of the particular source of income concerned. All employees are entitled to a standard allowance of EUR 132. Expenses in excess of this amount will be allowed if supported by receipts (e.g. office in home, continuing education).

Employee portions of mandatory contributions to Austrian and/or foreign social security are tax deductible.

In computing income from employment, expenses related to the production and collection of income is generally tax deductible. These expenses include the following:

• Membership fees to certain organisations (e.g. Chamber of Labour, workers council).
• Compulsory social and pension insurance contributions.
• Commuting expenses between residence and place of work where a standard deduction can be claimed per month; the deductible amount depends on the distance and the possibility of using public transport.
• Work equipment and special work clothes.
• Business related travel expenses and per diems.
• Technical literature.
• Training costs.

Tax relief for homeworking

EUR 300 as non-taxable flat rate expenses

Via the employer, it will be possible for employees to receive non-taxable flat rate expenses for homeworking in the years 2021 to 2023 in the amount of up to EUR 3 per home office day (i.e. any working day spent exclusively working from home), up to a maximum amount of EUR 300 per calendar year. If less than the maximum amount of flat rate expenses is paid out by the employer, employees will be able to claim the difference as income-related expenses in the employee tax assessments for the years 2021 to 2023 (maximum amount minus the flat rate granted by the employer).

This difference will not be offset against the general flat rate for income-related expenses of EUR 132.

Income-related expenses for ergonomic office furniture

Previously, it was only possible to deduct expenses for office furniture if the home office space was recognised for tax purposes. Under the new rules, it is possible to deduct expenses for ergonomic furniture for an office space in the private home (in particular, tables, swivel chairs, and desk lamps) as income-related expenses up to a maximum amount of EUR 300 per year if at least 26 days are spent working from home (home office days) in the calendar year.

Note: For the calendar year 2020, a different maximum amount of EUR 150 applied. For the calendar year 2021, the maximum amount was subsequently capped at the difference between EUR 300 and the amount recognised in the year 2020. The maximum amount that can be deducted for the years 2020 and 2021 was therefore EUR 300.

The respective maximum amounts of EUR 300 or EUR 150 (in the year 2020) constitute a total amount to cover the acquisition or production costs of ergonomic furniture. The rules on depreciation do not apply. Excess amounts in the tax years 2020 to 2022 (acquisitions above EUR 300/150) can be recognised within the maximum amounts until the tax assessment for 2023 if the minimum number of home office days in these years is fulfilled.

This amount will also not be offset against the general flat rate for income-related expenses.

Existence of a home office recognised for tax purposes

If a home office recognised for tax purposes exists, it is possible, as an alternative, to make an additional deduction for income-related expenses in the tax assessment in line with the previous or existing regulations. In this case, the provisions on the simplified recognition of income-related expenses for ergonomic furniture and/or the recognition of the unclaimed amount of the homeworking flat rate as income-related expenses should not be applied.

Personal deductions

Special expenses

Church tax is deductible up to EUR 400, and charitable contributions to certain institutions are deductible up to 10% of the current year’s taxable income. Austrian tax adviser fees are fully deductible.

Extraordinary expenses

Individuals who incur extraordinary expenses can obtain some tax relief. This relief applies to resident individuals who are subject to unlimited tax liability who incur unavoidable expenses (e.g. funeral costs, medical expenses for special treatments not reimbursed by health insurance). Depending on income and family status, the taxpayer may be able to deduct an amount that exceeds a certain percentage of one's income. The retention rates are as follows:

The percentage is reduced by 1% for an individual:

• who is eligible for a sole earner tax credit or a single parent tax credit, or
• who is not eligible for a sole earner or a single parent tax credit but the individual is married more than six months during the calendar year or living more than six months in a registered partnership and is not permanently separated from one's married/registered partner whose income is less than EUR 6,312 per year,
• as well as for every additional child if the taxpayer receives for more than six months the child tax-free amount or the alimony tax credit.

Certain expenses (e.g. damage due to disaster) are generally fully tax deductible.

Family bonus plus

The family bonus plus is a tax credit, which reduces the amount of tax paid. The annual tax credit of EUR 2,000 per child can be claimed for children up to the age of 18 years, who live in Austria, and are entitled to family allowance. If both parents claim the family bonus plus, both taxpayers are entitled to 50% of the tax-free amount (EUR 1,000 per annum for each taxpayer).

For children between 19 and 24 (in some cases until 25), the family bonus plus can be granted up to an amount of EUR 650 per annum.

Allowances

Generally, personal allowances take the form of tax credits, i.e. deductions from tax payable. By contrast, family allowances are paid to the taxpayer in cash. See the Other tax credits and incentives section for more information.

Losses

Business losses or rental losses can be offset with other categories of income. Business losses can be forwarded in following years in case assessed by adequate and orderly accounting.

Rental losses cannot be carried forward.

For a discussion of capital losses, see Capital gains in the Income determination section.