Tax & Legal News in English | March

Start-Up employee shareholding

The newly introduced start-up employee participation scheme intends to promote the retention of qualified employees in start-ups and SMEs. Under certain conditions, a tax deferral is granted for employee share participations until the actual sale of the shares or the occurrence of certain other circumstances. In addition, a tax-favorable lump-sum rule may apply at the time of the actual taxation.

For contact details and more information in German click here...

Virtual Participation Programs

Virtual participation programs offer companies an effective way to attract talented employees and to motivate and retain them in the long term, even when financial resources are limited. By involving employees in the economic success of the company, they are incentivized to perform their best and contribute to the company's growth.

The accounting for such obligations may necessitate the recognition of a provision in the company's financial statements under Austrian GAAP, if it is more likely than not to be utilized. The assessment of the probability will essentially depend on the specific transaction stage.

For contact details and more information in German click here...

Updated Information Letter on the EU Mandatory Disclosure Regime

The information letter published by the Federal Ministry of Finance on 12 September 2023 replaces the previous information letter dated 21 October 2020 and contains some changes and clarifications on the application of the EU mandatory disclosure regime, which was passed in Austria to implement the Council Directive (EU) 2018/822 (DAC 6).

For contact details and more information in German click here...

GHG-Quota: Did you already hear about the “ePrämie”?

Since 2023, electric vehicle owners in Austria have been eligible to receive an “ePrämie” based on the concept of the GHG quota. The “ePrämie” rewards reduced CO2 emissions and utilizing renewable electricity when using a not public charging station. The application for the “ePrämie” is very simple without administrative hurdles and amounts up to EUR 1.000 per year. However, as it was just introduced in 2023 it is still quite unknown. The “ePrämie” is subject to distinct tax regulations: Entrepreneurs are required to declare business income and pay taxes on the received premiums, whereas premiums received by individuals as non-business income are tax-exempt.

For contact details and more information in German click here...

Adjustment of size categories for corporations and disclosure obligations

As a result of the inflation in recent year, the European Commission has initiated an increase in the threshold values for determining the size categories for corporations. The size category balance sheet total and sales revenues were each increased by 25 %. This adjustment of the size categories is intended to simplify the audit and reporting obligations for companies. The adjustment of the size categories is mandatory for financial year beginning on or after 1 January 2024. However, the member states have a temporal option. For this reason, the new thresholds may already apply to financial years beginning on or after 1 January 2023. The member states have to implement the adjustment into national law by 24 December 2024 at the latest. In Austria the implementation is currently still pending. Depending on the respective size category, the documents to be disclosed must be submitted to the commercial register no later than nine months after the balance sheet date. The Commercial Register Court must check whether the documents to be disclosed have been submitted in full and whether any publications have been made. In the event of a breach of the disclosure obligations, mandatory penalties of EUR 700 to EUR 3,600 are to be imposed on both the company and the individual legal representatives.

For contact details and more information in German click here...

Tax Appeals Court: Interim tax avoidance for grants to foreign beneficiaries

Austrian private foundations are subject to the so-called interim tax on certain income. According to the current Austrian legal situation, this interim tax can be avoided by offsetting against grants subject to Austrian capital gains tax. As grants to foreign beneficiaries are often exempt from Austrian capital gains tax, it is due to current Austrian legal situation not possible to avoid the interim tax with grants to foreign beneficiaries.

The Tax Appeals Court recently had to decide in two cases whether the non-exemption from interim tax for foreign beneficiaries is justified and declares the current legal situation to be contrary to EU law.

Meanwhile an official appeal has been lodged against one of the two decisions. It therefore remains to be seen how the Administrative High Court will rule and how Austrian legislator will react to those developments.

For contact details and more information in German click here...

Financial incentives for the purchase of residential property

The Austrian government has concluded a Housing and Construction Stimulus Package and introduces significant relief for residential property buyers. From 1 April 2024, land registration fees will be waived until the 30 June 2026 for acquisitions of residential properties of less than EUR 500,000 intended as main residence. These measures aim to facilitate homeownership and invigorate the real estate market.

The exemption extends to the registration of encumbrances up to EUR 500,000. Fees for amounts exceeding this threshold but below EUR 2 million are subject to standard rates. However, if the assessment basis for the acquisition or encumbrances exceeds EUR 2 million, the entire fee exemption is cancelled. To qualify for the exemption, buyers must establish their main residence in the new residential property for the next five years. The relief is contingent on purchase agreements concluded after 31 March 2024, and registration applications submitted no earlier than 1  July 2024.

At the same time, the government is introducing measures to encourage the construction sector, including an extension of the depreciation rates for eco-certified residential buildings completed by 31 December 2026, and a temporary 15 % "Eco-Surcharge" for environmentally friendly renovations in rented residential buildings. The aim of these initiatives is to promote sustainable development and to encourage investment in energy-efficient housing.

For contact details and more information in German click here...

Tax Deadlines in April 2024

• Advance VAT declaration for February 2024.
• Standardized Consumption Tax for February 2024.
• Capital Gains Tax for capital gains on debt securities for February 2024.

For an overview of all Tax Deadlines in April click here...