Austria: Worked Example of Tax on Rent

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Tax Example: Rent

Non-resident couple's joint monthly rental income1		€1,500	€6,000	€12,000
Annual Rental Income		18,000	72,000	144,000
Less Annual Allowance2		(5,143)3	(22,041)4	(44,082)5
Less Costs (15%)6		(2,700)	(10,800)	(21,600)
Less Real Estate Tax		(343)	(1,469)	(2,939)
= Net Rental Income		9,814	37,690	75,380
Additional Fictional Tax Base7		16,000	16,000	16,000
= Taxable Income		25,814	53,690	91,380
Income Tax Rates
Up to €10,000	nil	-	-	-
€10,000 - €25,000	38.33%	-	-	-
€25,000 - €51,000	43.596%	6,105	-	-
Over €51,000	50%	-	18,430	37,275
Annual Income Tax Due		€6,105	€18,430	€37,275
Tax Due as % of Gross Income		33.92%	25.60%	25.89%
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DISCLAIMER: The information contained above is marketing material only and is not written tax advice directed at the particular facts and circumstances of any person and should not be relied upon. We encourage you to discuss your particular situation with us or an independent tax advisor. This information was last updated on January 16, 2008.

Notes

¹ The property is jointly owned by husband and wife, but then taxed separately (50% upon each partner).

² According to local laws, the annual allowance for buildings subject to rent amounts to 1.5% of the acquisition costs in the case that no evidence of the useful life is provided. In these cases, this rule is utilized.

³ Acquisition costs of the property are €342.854. (€342,854 * 1.5% = €5,143)

⁴ Acquisition costs of the property are €1,469,388. (€1,469,388 * 1.5% = €22,041)

⁵ Acquisition costs of the property are €2,938,776. (€2,938,776 8 1.5% = €44,082)

⁶ Income-generating expenses are deductible. In these cases, it is assumed that income-generating expenses are around 15% of gross income.

⁷ The tax base of each non-resident individual is fictionally increased by €8,000. [Section 102 (3) IITA]

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