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Jul 17, 2013

Rental income tax is high in Austria


INDIVIDUAL TAXATION

Nonresidents are taxed on their Austrian-sourced income. Married couples are taxed separately.


INCOME TAX

Income is taxed at progressive rates.

INCOME TAX 2012

TAXABLE INCOME, MARGINAL TAX RATE
Up to 11,000 0%
11,000 25,000 0% - 20.40%% on band over 11,000
25,000 60,000

20.40% - 33.70% on band over €25,000

Over 60,000 50% on all income over 60,000
Source: Global Property Guide

INCOME TAX 2011

TAXABLE INCOME, MARGINAL TAX RATE
Up to 11,000 0%
11,000 25,000 36.50% on band over 11,000
25,000 60,000 43.21% on band over 25,000
Over 60,000 50% on all income over 60,000
Source: Global Property Guide

RENTAL INCOME
Taxable rental income is the excess of receipts over income-related expenses (werbungskoten). Expenses such as maintenance and repairs, depreciation, administrative expenses (including professional tax advice), interest payments and real estate tax are deductible.

Nonresidents suffer special penalties, the tax base of each nonresident individual being notionally increased by 8,000.

Austria houses realestate

Stamp Duty on Lease Contracts

Stamp duty is levied on various transactions in Austria, including lease contracts. Stamp duty rates range from 0.8% to 2%.

CAPITAL GAINS
Capital gains realized from the sale of real estate held for more than 10 years are exempt from taxation. But properties sold within 10 years of acquisition are taxable, except if the property has served as the owners primary residence for the past two years or if the owner have erected or have the building erected himself.

Taxable capital gains for properties sold within the 10 years retention period will be considered as speculative (exemption stated above) and will be charged at the same rates as income tax. The acquisition cost will be deducted from the selling price to arrive at the taxable amount.

PROPERTY TAXES


REAL ESTATE TAX

Property taxes in Austria are levied on the assessed value of real property, which is generally less than the prevailing market value. It is levied at a basic federal rate, multiplied by a municipal coefficient. The basic federal rate is generally 2% and the municipal coefficients range up to 500%.

CORPORATE TAXATION

INCOME TAX

The standard corporate income tax rate is 25%, which is levied on income and capital gains earned by companies. This rate applies to companies incorporated in Austria or foreign companies doing business in Austria.

Starting 2006, net rental income by nonresident individuals will also be taxed as business income at the tax rate of 25% if the property is part of his business abroad.





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