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 organizations (e.g. Chamber of Labor, 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.

Personal Deductions

Special Expenses

• Certain relief allowances are available against taxable income if the annual income does not exceed EUR 60,000. These allowances include:
  • Sickness, life, and accident insurance premiums.
  • Voluntary contributions to employer pension plans and/or state social security.
  • Expenses for the construction of a new house/apartment or renovation of housing space in Austria.

• Please notice that due to the Austrian tax reform 2015/16 these allowances are only available against taxable income if the contract with the insurance company in connection with the payments was closed before 1 January 2016 and only for the duration of five years (until 2020).
• For these types of expenses, a standard allowance of EUR 60 per year is granted, unless higher payments have been made. In the latter case, the deductible amount is limited to 25% of expenses up to EUR 2,920 per year for single taxpayers and 25% of expenses up to EUR 5,840 are tax deductible under the following conditions:
  • the individual is eligible for a sole earner or a single parent tax credit, or
  • the individual 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 6,000 per year.

• For taxpayers who earn between EUR 36,400 and EUR 60,000 per year, the maximum deductible amount is reduced step-by-step on a ratable basis. 
• The standard deduction of EUR 60 remains in any case tax deductible.
• 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. T
• his 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 6,000 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

• From 2019, the child care deduction and the child tax-free amount are replaced through the family bonus plus.
• The family bonus plus is a tax credit, which reduces the amount of tax paid. 
• The annual tax credit of EUR 1,500 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 750 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 500 per annum.
• The family bonus plus can be taken into account in the payroll during 2019 or in the tax return for 2019 in 2020.