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What are the VAT Rates Applicable in Austria?

Austria is considered a country for financial success. It is a popular country for entrepreneurs who are looking for new markets. Doing business in this country requires knowledge of local tax laws. It’s worth having a closer look at what are Austria VAT rates, and how should VAT be accounted for? Here are tips on the subject.

Obligation to register for VAT

Foreign entrepreneurs who want to do business in Austria are required to register for VAT. They are responsible for applying the appropriate VAT rates when supplying goods and services, as well as collecting VAT from their customers and remitting it to the relevant tax office. VAT registration is required for the shipment or purchase of goods from other EU countries, the sale of goods to local customers, as well as any buying and selling operations carried out in Austria.

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VAT registration threshold

Austria currently has the same VAT registration threshold as other European Union countries. A sales threshold of €10,000 applies. This is a fixed value that does not depend on the currency exchange rate or the country of the buyer of the goods and services. Once this threshold is exceeded, the company must be registered for VAT. It is worth mentioning that total sales conducted in all countries of the European Union are included in this amount.

Various VAT rates in Austria

The basic Austria VAT rate is 20%. It applies to most goods and services. In addition, reduced rates have been introduced: 13% and 10%. The first of these applies to, among other things, the supply of animals and plants, hotel accommodation services, firewood, cultural services, domestic flights, sporting events, amusement parks, certain agricultural products, wine production and cut flowers. A second reduced rate of 10% applies in areas such as heating costs, repair work, renting, leasing, foodstuffs, water supply and pharmaceutical production. International transportation and intra-EU transactions, on the other hand, are subject to a 0% rate.

VAT exemptions in Austria

Companies subject to VAT can take advantage of input tax deduction in Austria. VAT paid for services or supplies by another business is deducted from its own VAT liability. Banks, doctors and insurance companies, among others, are exempt from VAT. Another important note is that small businesses with an annual turnover of no more than €35,000 are exempt.

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Obligation to file VAT returns

VAT payers are required to file a VAT return at the end of the calendar year. Foreign companies doing business in Austria must file VAT returns during the calendar year. Advance VAT returns can be filed on a monthly or quarterly basis. The Federal Central Tax Office verifies the accuracy of the data and also checks whether the company is entitled to a VAT refund.

Cooperation with a tax office

Regulations in many European countries can change frequently, depending on the current economic situation. Therefore, many entrepreneurs choose to establish cooperation with a tax office such as INTERTAX. It makes VAT accounting easier and ensures that all transactions are carried out in accordance with the applicable law. In this way, business owners can focus on developing sales of goods and services without worrying about penalties from the local tax office.

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