Austria - Tax Guide for Freelance Contractors

Tax Residents in Austria:           are liable to pay Austrian tax on their worldwide income,
Non tax residents in Austria:     are liable to pay tax on Austrian-source income only.

Individuals will be regarded as tax residents:

• if their habitual abode (deemed if they stay for longer than 6 months) or their domicile (i.e. they permanently occupy   a residence) are in Austria.

Married persons file tax returns separately.

Taxable income includes:

• employment income
• carrying on of a business or profession
• income from investments

Certain deductions are permissible including:

• contributions to private health, life, accident and pension insurance and certain Austrian pension funds,
• expenses incurred in acquiring, securing and maintaing income,
• expenses for house construction or renovation,
• standard business expense allowance of EUR 132.  Expenses in excess are allowed if supported by receipts,
• charitable contributions to certain institutions up to 10%.

Allowances and tax credits for 2011 include:

• child allowance avg. EUR 1'395 per year per child,
• sole educator credit of EUR 494 for unmarried taxpayers with one child and EUR 669 for unmarried taxpayers with two children,
• retirement credit of EUR 400.

Income tax rates for 2011:

• 36.50% from EUR 11’000 up to EUR 25’000,
• 43.20% from EUR 25’000 up to EUR 60’000,
• 50.00% over EUR 60'000.