Moving to a new country can be an exciting challenge, especially when it comes to understanding how to manage your finances and taxes. If you’ve recently relocated to Austria, this guide will help you navigate the essentials of the Austrian tax system,  including residency rules, tax brackets, deductions, and how to file your return correctly.

By the end, you’ll know exactly what’s required of you so you can stay compliant and focus on enjoying life in one of Europe’s most scenic and well-organized countries.

When Do You Need to File Taxes in Austria?

Before filing your taxes, it’s important to determine whether you are a tax resident or a non-resident, as this affects how your income is taxed.

You are considered a tax resident in Austria if you:

• Have a permanent home in Austria (rented or owned).

• Stay in Austria for more than 183 days within a calendar year.

• Have your center of vital interests (family, work, or economic activity) in Austria.

Tax residents must pay tax on their worldwide income, while non-residents are taxed only on income earned within Austria.

The Austrian tax year runs from January 1 to December 31, and the filing deadline is typically April 30 of the following year for paper returns and June 30 if filed electronically via the FinanzOnline platform. Extensions can be granted in certain cases, especially when filing through a tax advisor.

Understanding the Austrian Tax System

Austria operates a progressive income tax system, meaning higher incomes are taxed at higher rates. The system applies to all types of personal income, including salaries, self-employment, pensions, rental income, and certain capital gains.

Income Tax Rates in Austria for 2026

Austria’s progressive tax system ensures that higher earners contribute a larger share, while lower-income individuals benefit from exemptions and social support mechanisms.

Additional Taxes to Note

In addition to income tax, you may encounter other taxes depending on your situation:

• Social Security Contributions: Employees and employers must contribute to Austria’s comprehensive social insurance system, covering health, pension, unemployment, and accident insurance.

• Capital Gains Tax (Kapitalertragsteuer): 27.5% on interest, dividends, and gains from investments.

• Real Estate Transfer Tax: 3.5% on the purchase price of real estate.

• Value Added Tax (VAT / Umsatzsteuer): Standard rate of 20%; reduced rates of 13% and 10% for specific goods and services.

• Church Tax (Kirchensteuer): Around 1% of taxable income for registered church members.

• Municipal Taxes: Certain local taxes may apply, depending on your place of residence or employment.

Common Tax Deductions and Credits

Austria offers a variety of deductions and tax credits that can help reduce your taxable income. Here are some of the most common:

• Work-Related Expenses (Werbungskosten): Deductions for travel, professional training, tools, and work equipment.

• Special Expenses (Sonderausgaben): Includes voluntary pension contributions, insurance premiums, and certain donations.

• Extraordinary Burdens (Außergewöhnliche Belastungen): Expenses due to illness, disability, or support for dependents with special needs.

• Family and Child Benefits: Parents can claim family bonuses and tax-free child benefits (Familienbonus Plus).

• Commuter Allowance (Pendlerpauschale): Deduction for travel costs between home and workplace.

• Charitable Donations: Donations to approved organizations are tax-deductible up to certain limits.

How to File Taxes in Austria

Filing taxes in Austria is relatively straightforward, especially with the digital tools provided by the government. Here’s what to do:

1. Gather Your Documentation

Before filing, prepare the following documents:

• Wage and Tax Statement (Lohnzettel) from your employer.

• Social security and pension contribution statements.

• Bank and investment records.

• Invoices or receipts for deductible expenses.

• Proof of family status or dependents (if applicable).

2. File Through FinanzOnline

The easiest way to file taxes in Austria is through FinanzOnline, the government’s secure electronic tax portal. Registration is free, and most individuals can submit returns online.

You’ll use the Annual Income Tax Return form (E1) or related sub-forms depending on your income type.

3. Submit Your Tax Return

• Deadline for paper filing: April 30, 2027 (for the 2026 tax year).

• Deadline for online filing: June 30, 2027.

• Through a tax advisor: Extensions may be available upon request.

Once submitted, the Austrian tax authority (Finanzamt) will review your return and issue a tax assessment notice (Bescheid).

4. Pay or Receive Your Tax Balance

If your assessment shows additional tax due, payment can be made via bank transfer. If you’ve overpaid, a refund will be deposited directly into your account.

5. Get Professional Help if Needed

For complex cases,  such as foreign income, dual residency, or investment portfolios,  consider hiring a Steuerberater (tax consultant). They can ensure full compliance and help optimize deductions.

Final Tips

Filing taxes in Austria doesn’t have to be stressful. With careful preparation and understanding of the system, you can stay compliant and even benefit from deductions and allowances.

Keep these points in mind:

• Always keep records and receipts for at least seven years.

• File early to avoid system delays or last-minute issues.

• Check your FinanzOnline account regularly for updates or notices from the tax office.

• Review any changes to Austrian tax laws each year, as rates or deduction limits may shift slightly.

By staying informed and organized, you can manage your tax obligations efficiently and enjoy the peace of mind that comes with financial clarity.