VAT in Austria – what you need to know

Taxes are an unavoidable aspect of running every business. There are many taxes, depending on the type of services you provide and the country in which you operate. Surely the two most common are income tax and value added tax. How much of VAT will you pay in Austria? Lets dig into Austrias tax regulations.

VAT in Austria

Being a part of the European Union, Austria needs to follow certain regulations. They state, for example, that each country needs to set their standard VAT rate above 15%. European Union regulations were created to make intra-community trade easier. As a result, the rules for charging and collecting VAT are similar to all EU countries, as they must be compatible with each other and EU VAT directives.

Foreign entrepreneurs doing business in Austria must be registered for VAT in Austria and must apply the local rates when supplying goods and services there. The threshold is now unified in European Union and the limit for distance sales is currently €10.000 net – independent of the conversion rate or the country of the buyer. To put it simply, this means that you are required by law to apply for a VAT number in each country you are selling to, if your total turnover exceeds €10.000 within the borders of the EU.

Obtaining an Austrian VAT number

To get an Austrian VAT number, one must provide:

1. Business licence,
2. VAT certificate confirming that the company is registered as a VAT payer in another European Union country (if applicable),
3. company statute – extract from the company’s national commercial register.

The application can be submitted online, via forms downloadable from the Austrian Ministry of Finance. Non-resident companies located in the EU can also register directly.

VAT rates in Austria

There are four different VAT rates in Austria:

• 20% – standard VAT rate, applied to most goods and services,
• 13% – first reduced VAT rate, applicable for: deliveries of live animals and plants, hotel accommodation, accommodation services, firewood, cultural services, domestic flights, sporting events, amusement parks, cultural sector, some agricultural supplies, wine production, cut flowers and plants for decorative use
• 10% – second reduced VAT rate, used with: accommodation and costs incurred, renting or leasing, food, domestic and international transport, restaurant and catering services (excluding beverages), water supplies, pharmaceutical products, feminine hygiene products, household linen, newspapers and periodical, printed books, e-books, cable TV, TV license, social services, domestic refuse collection, treatment of domestic waste and waste water, cut flowers and plants for food production; some agricultural supplies, writers and composers services,
• 0% VAT – on intra-community supplies transactions, intra-community and international transport (excluding road and rail transport).

The list doesnt cover everything and may not be complete. To always be sure, check with Austrias Tax Authority.

Deadlines

Countries from outside Austria have to submit VAT returns during the calendar year. All VAT taxpayers are required to submit VAT returns at the end of the calendar year and, during the year, also monthly or quarterly advance VAT returns.

The VAT is paid monthly or quarterly, 10 days after the reporting period ends. To obtain a VAT refund, one must submit an online application to the tax authority.