Tax declarations in Austria — how to claim your refund
Are you employed in Austria? Then we have good news — you’re likely eligible to claim a tax refund! Find out which deductions you can claim with this easy-to-follow guide.
9 min read
Dreading all the paperwork that comes with tax season? As a 100% mobile bank, we hear you. But when tax season rolls around, it usually pays to take a closer look at your payslips and receipts. Why? If you’re an employee in Austria, you might have paid more income tax in 2023 than you needed to. Whether you bought professional development books, work clothing, or office furniture in 2023 — you can declare these work-related expenses and get a refund from the tax office. We’ll show you how to make the most of your annual tax return, and several other things you’ll need to consider before submitting your tax declaration in Austria.
How income tax is calculated in Austria
In Austria, if you earn more than €11,000 per year, then you’re subject to income tax. There are several different tax brackets, meaning the actual tax rate you’ll pay depends on your annual salary. The highest tax rate is 55% and the lowest is 20%. The tax office calculates the total amount you’ll have to pay each month from your gross salary, based on the assumption that your salary stays the same. However, this isn’t always the case — you might change careers, look for a new job, or even take a sabbatical. Whatever the reason, if you earned less than the initial assumption during some of those months, there is a good chance you’ll have paid too much tax upfront. On top of that, there are a number of tax allowances in Austria that can contribute to your refund — such as commuting or having children. And there’s more good news — you can file retroactively for up to five years, meaning in 2024, you can file your tax returns for 2019 up to 2023! The hefty refund should be enough reason to devote some of your free time to filing your tax return properly — and, you can do it from the comfort of your own home, too.
Tips for maximizing your tax return savings
You can file your tax return (also called the ANV or “Arbeitnehmerveranlagung”) for the year of 2023 by 30 April 2024, or by 30 June 2024 if you file your tax return online. You can submit your tax declaration easily via the official platform FinanzOnline or the mobile “Steuer-App.” There are two ways to file your ANV. The first is a fully automated process, meaning you don’t need to fill in any forms. You can simply wait for your tax refund to show up in your account balance — provided you did pay too much in income taxes. However, if you’ve filed tax-deductible expenses such as income-related expenses for previous years, you’ll have to do your annual tax assessment manually. However, even if it’s your first time, you can still file manually via FinanzOnline. Here are just a few of the deductions that may make it worth your while:
Work-related expenses
From work clothes to professional-development materials to your smartphone bill — as an employee, you might have a number of work-related expenses that are considered tax-deductible in Austria. Were you looking for a job in 2023 and paid for further training out-of-pocket? These fees are considered work-related expenses, too. If you file your tax return without listing any of them, the tax office applies a standard deduction of €132.Here’s a list of the most frequent income-related expenses you can deduct from your taxes in Austria, provided they were relevant for your job:
Work equipment and tools
Work clothing
Home office supplies and furniture
Phone and/or internet bills
A computer
Professional-development materials
Transportation costs, e.g. car costs
Further or advanced training courses
Language courses
Study-related travel expenses
Travel and accommodation expenses
Double housekeeping
Union or works council dues
Cashier’s allowance (the sum of the difference in a cash register that a cashier must reimburse to their employer)
Tip: Remember to keep all bills and receipts for at least 7 years in case of a tax audit.
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Have you been primarily working from home in 2023? Then you might have had quite a few extra expenses, such as a new laptop or monthly internet bills. Employees in Austria can declare a deduction of up to €300 from their income taxes thanks to the home office standard deduction (“Home-Office-Pauschale”), which was first introduced in 2022. This amount will be deducted by default when you file. On top of that, you can declare another €300 (maximum) for office furniture. One thing to note: Ergonomic office furniture of up to €600 used to be deductible over the course of two years. Starting from the 2023 tax year, this is no longer valid.Technically, home office supplies are considered work-related expenses. This means that it’s likely worth deducting them individually rather than taking the automatic lump sum of €132.
Extraordinary expenses
Extraordinary expenses you might have had in 2023 are also considered tax-deductible, provided they exceeded your personal capacity to pay. These include adoption costs, braces, medical bills that aren’t covered by your health insurance, health care expenses, nursing expenses, as well as expenses related to a physical disability.
Commuting allowance
Are you commuting to work? Then you can save even more, specifically: between €31 and €306 per month! Commuting allowances are another work-related expense. However, in most cases, they are already settled with your monthly salary. For this, your employer uses form L 34 EDV. If the commuting allowance isn’t already accounted for in your monthly salary, you can declare it in your annual tax assessment. Have a closer look at your pay slip or contact your employer if in doubt.However, there is a special condition for your 2023 tax declarations: From January to June 2023, commuters benefit from a doubled commuting allowance — and in addition, the so-called “commuter euro” (Pendlereuro) will be quadrupled during this period. So, if you commuted to work quite a lot during this time, filing your tax return might prove quite beneficial.By the way: Your payslip automatically takes the “Verkehrsabsetzbetrag” into account. This negative tax has been increased to €421 for 2023 and remains untouched even if you make use of the commuting allowance.
Family Bonus Plus and child allowance
If you have children, you can directly reduce your tax burden thanks to the so-called Family Bonus Plus. From 2023 on, the maximum tax-deductible amount for each child under the age of 18 is €2,000 and €650 for each child over the age of 18 per year. However, the prerequisite for this is that you receive family allowance (Familienbeihilfe) for the child and are subject to unlimited tax liability in Austria.Are you a single earner or a single parent? If your income is too low to qualify for the family bonus, you will receive child allowance (Kindermehrbetrag) of €550 per year and child (from 2022) as a negative tax. Good to know: The amount will increase to €700 from 2024 onward.If you have three children or more, you can also apply for the multiple-child allowance (Mehrkindzuschlag) and receive €21.20 each month per child (although it only applies for your third child and any additional children after that). And with the single-earner allowance (Alleinverdienerabsetzbetrag), you can benefit from €572 for one child, €774 for two children, and €255 each for any other children in the 2023 tax year.
Cost-of-living deduction for employees
As a means of combating high inflation in Austria, a cost-of-living deduction (Teuerungsabsetzbetrag) for employees was introduced in 2022. The aim is to relieve the burden of lower-income employees in particular. Thanks to this regulation, a one-time deduction of up to €500 applies to employees with incomes of up to €18,200 — this is subject to negative taxation. This amount gradually decreases for incomes of up to €24,200. It’s also worth noting that pensioners can no longer benefit from this regulation in their 2023 tax declaration if they already received the deduction in September 2022.
Filing your Austrian tax report with a German IBAN
Once you’ve compiled all the necessary data and are ready to file your tax report online, there’s a few extra steps you’ll need to take before submitting. First, you’ll need to register at FinanzOnline and fill in the form L1 for your annual tax return. If you need to declare unanticipated expenses or want to receive the Family Bonus Plus, you’ll also have to fill in forms L1ab and E30, respectively. You can find several videos and guides online to help you.Are you currently residing and working in Austria, but using a German bank account? Here’s another tip for filing your tax report online — when entering the German IBAN in FinanzOnline, you’ll get an error notification. The system only accepts Austrian IBANs starting with AT. You can easily circumvent this by adjusting your settings. Just follow these steps:
Go to Profile → General information → Foreign bank account
Enter your German IBAN and click Save
Successfully filed your annual tax declaration? Great — you’re likely to receive a refund from the tax office by the end of the year. The average refund is €560, but if you had extra tax-deductible expenses in 2023, you might get even more money back.
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Taking care of that paperwork is worth it after all, right? And with N26, filing your taxes is becoming even less painless. N26 Insights organizes your monthly expenses and income by category, so you know exactly how much money you earned in 2023 and in which areas you could save a little more. Create your own custom categories with hashtags like #workrelatedexpenses or #taxes and add them to your transactions to get an even better overview. Download your bank statements with just two clicks via the N26 Web App — both for your main account and your Spaces sub-accounts.By the way: Why not create a dedicated Space for your income tax report? This way, you can easily drag and drop your tax refund from your main account into a Space — so you can save that money for your next vacation or special projects. Or, you put the money in your new savings account and get up to 4% p.a. interest on your tax return. That’s what we call motivation to file your taxes every year to get the most out of your annual tax assessment! Don’t have an account with N26 yet? Not to worry. Visit our compare page to find the account that suits you best and sign up in minutes!Additionally you can get a better overview with our handy 50 30 20 Budget Calculator and our monthly budget calculator.
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