Taxes in Austria
Austria has a comprehensive tax system with progressive income tax, significant social contributions, and a distinctive 14-month pay structure that offers tax advantages.
Income Tax (Einkommensteuer) 2026
Tax Brackets:
| Income (Annual) | Marginal Rate |
|---|---|
| €0 - €12,816 | 0% (tax-free) |
| €12,817 - €20,818 | 20% |
| €20,819 - €34,513 | 30% |
| €34,514 - €66,612 | 40% |
| €66,613 - €99,266 | 48% |
| €99,267 - €1,000,000 | 50% |
| €1,000,001+ | 55% |
14-Month Salary — Tax Advantage
Austria's unique system:
- Employees receive 14 monthly salaries (13th in June, 14th in November)
- These "special payments" taxed at favorable flat rate of ~6% (first €620 tax-free)
- Significant tax savings compared to regular income taxation
- Effectively reduces overall tax burden by several percentage points
Social Security Contributions
For employees:
| Contribution | Employee | Employer | Total |
|---|---|---|---|
| Pension | 10.25% | 12.55% | 22.8% |
| Health | 3.87% | 3.78% | 7.65% |
| Unemployment | 3.0% | 3.0% | 6.0% |
| Accident | — | 1.1% | 1.1% |
| Other levies | 1.0% | 1.0% | 2.0% |
| Total | ~18% | ~21% | ~39% |
Maximum contribution base (2026): ~€6,450/month — contributions capped above this
Self-Employed Taxes
For freelancers/self-employed:
- Income tax: Progressive rates (0-55%)
- Social contributions: ~20% of income (SVS)
- VAT: 20% standard (10% reduced, 13% for some services)
- Small business exemption (Kleinunternehmerregelung): VAT-free below €30,000 annual revenue
- Tax on freelance income starts at €11,000/year threshold
Deductions
Common deductions:
- Work-related expenses (Werbungskosten)
- Commuter deduction (Pendlerpauschale): Based on distance
- Home office deduction: €3/day, max €300/year
- Professional development and training
- Childcare: Up to €2,300/year per child under 10
Special deductions:
- Church tax (~1% of income): Deductible up to €400
- Donations to approved organizations
- Voluntary pension contributions
Filing Taxes
Deadlines:
- Paper filing: April 30 following tax year
- Online (FinanzOnline): June 30 following tax year
- Extensions available through tax advisor
FinanzOnline:
- Austria's official tax filing portal
- Free to use
- Available in German only
- Required for self-employed filing
Getting help:
- Steuerberater (tax advisor): €200-600 depending on complexity
- Arbeiterkammer (Chamber of Labour): Free tax advice for employees
- Lohnsteuerhilfe: Low-cost filing services
For Expats
Key considerations:
- Tax resident if Austrian home, center of vital interests, or 183+ days/year
- Tax residents pay on worldwide income
- Double taxation treaties with many countries
- Expat lump-sum deduction: 20% of salary (up to €10,000/year) for inbound expats not resident in Austria for past 10 years
- First year: Consider dual-status implications
Capital Gains & Investment
- Capital gains tax: 27.5% flat rate (stocks, bonds, crypto)
- Savings interest: 25% withholding tax (KESt)
- Real estate gains: 30% (Immobilienertragsteuer)
Church Tax (Kirchenbeitrag)
- ~1% of taxable income for registered church members
- Automatic if registered with a recognized church
- Can opt out at church office (not government)
- Deductible up to €400/year
Pro Tips
- •14-month salary structure means bonus months taxed at only ~6% — significant savings
- •FinanzOnline is the only way to file taxes online — German language only
- •Inbound expat deduction: 20% of salary (up to €10,000/year) if new to Austria
- •Arbeiterkammer offers free tax advice for employees — use this service
- •Keep records of all work-related expenses for deductions
Have questions about taxes in Austria?