A Comprehensive Guide to Austrian VAT
January 9, 2023
VAT Directives are issued by the EU and lay out the principles of the VAT regime to be adopted by the member states, including Austria. These directives take precedence over local legislation. Austria is part of the EU single market economy.
New EU-wide regulations went into effect on July 1, 2021, eliminating country-specific VAT thresholds (EUR 35,000 for Austria) and replacing them with a EUR 10,000 distance selling threshold.
A VAT ID is issued to resident and non-resident taxpayers who engage in activities that require them to register for VAT in Austria by submitting a written application to their corresponding tax authority.
The Bundesministerium fur Finanzen (Ministry of Finance) administers Austria's VAT.
When Do You Register for VAT?
If foreign businesses trade in Austria and are registered in their home state for VAT, GST, or tax, there is no VAT registration threshold. The distance selling threshold for VAT registration for EU VAT registered companies selling goods online to Austrian consumers is €35,000 per year.
Foreign traders may have the option of applying for VAT registration in Austria. There is no VAT threshold for this registration, and applications must be submitted to the VAT department within 30 days of a trader's first taxable supply. This includes even if the company operates within one of the 26 EU member states through intra-community acquisitions (transferring goods or services between EU states).
In some cases, non-EU companies may need to appoint a local fiscal representative. Registration in Austria is subject to strict rules.
Austrian VAT registration is required in the following scenarios:
Importing goods to the EU through Austria
Importing and exporting products inside Austria
Stocking products in an Austrian warehouse
Importing products from other EU nations into Austria
Distance selling to private individuals in Austria from another EU nation
If a business needs to store products in Austria, it will still need a VAT registration. The time it takes for a VAT number to be granted by the Austrian tax authorities varies, so businesses need to make sure to apply for one in advance.
Businesses selling in the EU now have the option of registering for VAT in one member state for all their EU sales of goods and services under the new EU-wide threshold of EUR 10.000.
In the country of origin or the home country of the business, distance selling revenues below this new threshold will still be subject to VAT. All the above sales are subject to tax in the country where the goods and services are delivered.
There are also businesses that are not required to register for VAT because the goods they supply are exempt from VAT. These persons or businesses include:
Public entities that are not considered to be businesses
Legal entities that do not operate as commercial companies
If a VAT ID is required to conduct transactions across EU Member States, such as intracommunity sales or intracommunity acquisitions, exempt businesses can still register for VAT voluntarily, even though it is not required. In order to avoid penalties, exempt businesses must inform the tax authorities of their registration for VAT.
What are the Austrian VAT Rates?
The standard Austrian VAT rate is 20%, but it's only 19% in the regions of Jungholz and Mittelberg. This applies to all goods for which no exemptions apply. The reduced VAT rates are 10% and 13%.
The 13% discount applies to, among other things, tickets to sporting and cultural events, domestic flights, pet food, and the services or goods of artists.
In addition, there is a 10% VAT discount. This lower cost applies to, among other things, the majority of food goods, books, hotel rooms, residential rents, newspapers, magazines, restaurants, passenger transportation, medications, and some product repairs.
The 0% rate applies to normal goods and services, such as exports and intracommunity supply.
Lastly, many items, including health care and financial services, are exempt from VAT.
When Do You File for VAT Returns?
Businesses having an Austrian VAT number are required to file periodic reports outlining all taxable sales and inputs (costs). Monthly or quarterly filings are required in Austria, depending on the yearly Austrian VAT due. Austrian VAT returns are due 45 days after the end of the reporting month. In addition, a yearly VAT return must be submitted in June of the following year.
The sole language supported by the Austrian FinanzOnline system for filing returns online is German.
How to Register for Austrian VAT?
VAT numbers are generally obtained within one month if your file is complete. If you would like to register for Austrian VAT, please contact us.
The Austrian tax office will demand the completion of the required forms and submission of the following documentation:
VAT certificates for EU states,if you are already registered for VAT in another EU State
Company registration certificate and Articles of Association
Directors passport copy
Business bank account statement or letter
Evidence of action in the country's territory, such as a contract, order form, etc. for Amazon sellers a screenshot of the Amazon store page showing your business address is sufficient
Non-resident companies operating in the EU may register immediately. However, non-EU enterprises are required to choose a fiscal representative to register for VAT on their behalf.
Foreign enterprises without a permanent presence in Austria must submit their registration paperwork to the tax office in Graz.
A foreign firm with a permanent presence in Austria must register with the local tax office.
Is a Fiscal Representative Necessary?
Non-European enterprises cannot independently register for VAT in Austria. They must do so through a VAT agent. This organization will represent you before the local VAT authorities. He is liable for the fulfillment of all of your VAT duties, including those of which he was unaware. Before accepting the representation assignment, he may thus ask for a deposit (such as a bank guarantee) from you.
Companies in Europe are not required to hire a VAT representative. To expedite their interactions with the local tax authorities, they may, however, designate a proxyholder (an agent) to handle tax requirements on their behalf. In this circumstance, a bank guarantee is unnecessary. The corporation continues to bear entire responsibility for paying its VAT arrears.
Whether you need help registering for Austrian VAT or are unsure if you need to register, please contact us for a free consultation.