Last Updated: April 2026
Austria's income tax system is broadly similar to Germany's but with its own rate structure and some distinctive features — notably a 55% top rate on income above €1M, and a flat 27.5% capital gains and dividend tax (Kapitalertragsteuer, KESt). Austria's progressive rates are among the highest in the EU for mid-to-high earners, though the country offers a high standard of living, excellent public services, and a generous social security system.
This guide covers Austrian income tax rates, the KESt flat tax on investment income, social insurance contributions, the 13th and 14th salary provisions, and what expats need to know about Austrian tax residency and filing.
According to the Austrian Federal Ministry of Finance (BMF), Austrian income tax rates for 2024 are:
| Taxable Income (EUR) | Rate |
|---|---|
| Up to €12,816 | 0% |
| €12,817–€20,818 | 20% |
| €20,819–€34,192 | 30% |
| €34,193–€66,612 | 41% |
| €66,613–€99,266 | 48% |
| €99,267–€1,000,000 | 50% |
| Above €1,000,000 | 55% |
These are the rates on taxable income after deductions. The 0% band (up to €12,816) provides a genuine tax-free threshold — similar to Germany's Grundfreibetrag.
The 41% rate kicks in at a relatively low level (€34,193 — approximately €2,850/month gross) making Austria's effective rate on mid-range earners notably high. A single employee earning €60,000/year faces an effective income tax rate of approximately 30% before social insurance.
Austrian employees pay significant social insurance contributions alongside income tax. For 2024, employee total contributions approximately 18.12% of gross income:
Employer contributions add approximately 21.1% on top. Combined employee + employer rate: approximately 39% of gross salary in social insurance contributions. These contributions fund Austria's comprehensive social welfare system including universal healthcare, statutory pension (ASVG-Pension), parental leave, and unemployment benefits.
Social insurance contributions are capped at a maximum contribution basis — in 2024, the monthly cap for pension insurance is €6,060/month gross (€72,720/year). Income above the cap is not subject to further pension contributions but remains subject to income tax.
Austrian employment contracts typically include two additional monthly salary payments: the holiday bonus (Urlaubsgeld) and Christmas bonus (Weihnachtsgeld) — together sometimes called the '13th and 14th salary.' These are a legally recognised part of Austrian compensation, provided for in collective bargaining agreements (Kollektivverträge) covering most industries.
The 13th and 14th salary payments receive special tax treatment. The first €620 is tax-free. The remainder up to €24,997 (the sonstige Bezüge annual limit) is taxed at a flat 6% — significantly lower than the marginal income tax rate that would otherwise apply. Any amounts above €24,997 are taxed at the regular marginal rate.
This preferential treatment means the effective tax rate on the 13th/14th salary is dramatically lower than regular monthly salary — a key reason why Austrian total compensation (monthly × 14) understates the tax efficiency of the Austrian pay structure.
Austria levies a flat 27.5% Kapitalertragsteuer (KESt) on investment income, including:
The 27.5% rate applies to the final income — no further income tax is payable. This is the definitive tax (Endbesteuerungswirkung) on investment income — it does not enter the progressive income tax calculation.
Gains from selling real estate are taxed at a flat 30% ImmoESt (Immobilienertragsteuer) regardless of holding period. There is no long-term holding exemption as in Switzerland or Germany — all property gains are taxable at 30%. Exception: owner-occupied primary residence sold at least 2 of the last 5 years — exempt from ImmoESt.
Since 2022, cryptocurrency gains are taxed in Austria at 27.5% KESt — the same rate as other securities. This alignment of crypto with regular financial instruments (rather than treating them as speculative income at full marginal rates) was an important 2022 change.
Austria taxes residents on worldwide income. You are an Austrian tax resident if you:
Non-residents: taxed only on Austrian-source income (employment in Austria, Austrian business profits, Austrian real estate income). Withholding taxes apply on Austrian-source dividends (25% standard; reduced by DTA to 10–15% for treaty partners), interest (25%), and royalties.
Austria levies an exit tax (Wegzugsbesteuerung) when you move abroad. Unrealised capital gains on shares and other securities are triggered and taxed at 27.5% KESt at the time of departure (for EU/EEA moves: deferral available until actual realisation). This can create a significant tax liability for investors who hold appreciated Austrian or international securities.
Austria's tax year is the calendar year. PAYE employees have tax deducted at source (Lohnsteuer). Annual assessment:
FinanzOnline (finanzonline.bmf.gv.at) is Austria's online portal for filing and managing tax affairs. Most Austrians file electronically. Tax assessments (Einkommensteuerbescheid) are issued electronically or by post. Underpayments attract interest (Anspruchszinsen at approximately 5.5% p.a. in 2024).
CountryTaxCalc.com is reader-supported. When you use our partner links, we may earn a commission at no cost to you. Learn more about our affiliate partnerships
★ 4.8 Trustpilot · 1,625 reviews
US citizens in Austria still file US federal returns — FEIE, FTC, FBAR, and FATCA all apply. Austrian exit tax on departure and KESt treatment of US securities add complexity. Greenback's CPAs handle US-Austria dual tax situations.
⚠ Not the cheapest option — best for complex situations and expats who want a dedicated CPA.
Get US + Austria Tax Help →★ 4.3 Trustpilot · 287,413 reviews
Convert EUR Austrian salary to USD or GBP at real exchange rates. Wise saves expats 3–5% vs banks on transfers. Hold multiple currencies and use the Wise card across Europe. No monthly fees.
⚠ For currency exchange only — not a bank account replacement.
Open EUR & USD/GBP Accounts →Austria's top income tax rate is 55% on income above €1,000,000 annually. This applies only to income above the €1M threshold — not the entire income. Below €1M but above €99,267, the rate is 50%. For most Austrian employees and self-employed (even high earners), the effective top rate encountered is 50% (for income between €99,267–€1M). Adding 18.12% social insurance on income up to the cap, the total marginal deduction for mid-to-high earners can reach 55–60% of gross income in the affected bands.
Investment income (dividends, capital gains from securities, interest) is taxed at a flat 27.5% KESt — this is a definitive final tax, separate from the progressive income tax scale. Austrian banks deduct KESt at source on Austrian-held accounts and funds. Foreign-held investments must be declared in the annual return. Real estate capital gains are taxed at 30% ImmoESt regardless of holding period (with an owner-occupied primary residence exemption). Crypto assets have been taxed at 27.5% KESt since 2022.
Austrian collective bargaining agreements (Kollektivverträge) require most employers to pay an annual holiday bonus (Urlaubsgeld) and Christmas bonus (Weihnachtsgeld) — typically one month's additional salary each, paid in June and November respectively. The first €620 of these special payments is tax-free. The remainder up to €24,997 per year is taxed at a flat 6% (rather than the marginal rate of 30–55%). This creates a strong incentive to structure Austrian employment compensation with these bonus payments, as the effective tax rate on up to ~€25,000 in annual bonuses is just 6%.
Yes — Austria has Double Taxation Agreements with both the USA and the UK. Austria-USA DTA: prevents double taxation for US citizens working in Austria; US citizens still owe US worldwide tax but can use FEIE and FTC. The Austria-USA DTA reduces withholding on dividends to 5–15% and interest to 0%. Austria-UK DTA: coordinates UK and Austrian tax obligations for British residents in Austria and Austrians in the UK. Austria has DTAs with approximately 90 countries — most major source-country income types are covered with reduced withholding rates.
Austria's social insurance system (ASVG — Allgemeines Sozialversicherungsgesetz) provides: health insurance (Krankenversicherung) — universal healthcare access through the Österreichische Gesundheitskasse (ÖGK); statutory pension (Pensionsversicherung) — the Alterspension (retirement pension) from age 65 for men/60 for women (converging to 65 by 2033); accident insurance (Unfallversicherung); parental leave pay (Kinderbetreuungsgeld) for up to 36 months; unemployment benefit (Arbeitslosengeld) — up to 60% of prior net income for up to 39 weeks (52 weeks for those over 50 with long service). The breadth of benefits makes the 18.12% employee contribution a genuine return for most workers.