Doing business in Austria - PKF

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If they are induced by a previous profit distribution of the company and if the dividends received from the participation are tax-exempt for the receiving company. To the extend the write-down of a participation or capital loss is basically tax effective, the amount must be apportioned over a seven-year period. With regard to participations included in a tax group, an impairment of the participation at the level of the group parent is not tax effective during the existence of the group. • In case of a shareholder’s contribution down a chain of companies (grandparents contributions) to cover the losses of the second-tier subsidiary resulting in an increase in the book value of the participation at each level, a depreciation or a loss from the sale of the participation is only tax-deductible at the top-level (provided there is a decrease in value of the participation), whereas a depreciation at the level of the intermediary corporations in principle is not tax-effective. • Losses suffered by a foreign permanent establishment of an Austrian company reduce the Austrian tax base of the company, even if the tax treaty between Austria and the permanent establishment-country provides for the exemption method. To avoid a double utilization of the permanent establishment-losses in Austria and the permanent establishment-country, the use of the tax losses of the permanent establishment will lead to a claw-back at the time the foreign permanent establishment earns profits against which the foreign loss carry-forwards can be offset. • Goodwill: A goodwill acquired for a consideration must be amortized over 15 years. • Intangible fixed assets: have to be capitalized only if they are acquired for a consideration, and are to be amortized over their useful lives. • Depreciation: For tax purposes, only the straight-line method of depreciation is permitted. Excess write down to the lower going concern PKF - Doing business in Austria - Taxation 15
value in case of technical or economic obsolescence is possible. For the first financial year of use, depreciation for 12 months is allowed, if the asset has been in use for more than 6 months throughout the respective financial year. Otherwise, half the annual rate is deductible. Except for buildings (50, 40 or 33 years) a goodwill (15 years) and passenger cars (8 years), depreciation rates are not fixed by Austrian tax law. • Other deductible expenses: - Depreciable movable assets with a price not exceeding € 400 can be fully expensed in the year of acquisition or production. - Repair and maintenance payments are tax deductible in the period incurred. Repairs that lead, in effect, to a new asset must be capitalized as such. Lodgement of Returns Taxpayers are required to lodge returns annually. The due date for the filing of tax returns is March 31 st of the subsequent calendar year irrespective of the financial year-end. Taxpayers represented by a tax adviser may file their tax returns with the tax office by April 30 (at the latest) of the second subsequent calendar year. Payment of Tax Prepayments of corporate or income tax have to be made in four equal instalments each year in accordance with the assessment notice issued by the tax authorities. The prepayment is generally based on the prior year’s tax payments, whereas a reduction of the prepayments may be granted upon application. The prepayments fixed for the assessment period and any amounts collected by withholding are credited against the final corporate or income tax liability. 16 PKF - Doing business in Austria - Taxation
Page 1 and 2: Accountants & business advisers Doi
Page 3 and 4: Contents Introduction 1 • Geograp
Page 5 and 6: Grants and Incentives 30 • Genera
Page 7 and 8: Apart from that, Austria is an attr
Page 9 and 10: Austria’s law follows the regulat
Page 11 and 12: Business Structures Types of Busine
Page 13 and 14: shareholders may be individuals or
Page 15 and 16: A company is a large company if at
Page 17 and 18: Taxation Introduction The tax statu
Page 19: expenses that are necessary to gene
Page 23 and 24: Taxation of Companies Taxation of P
Page 25 and 26: Taxation of Branches The existence
Page 27 and 28: at the full rate of 25%. Income tax
Page 29 and 30: consulting services, directors’ f
Page 31 and 32: provided by doctors and hospitals a
Page 33 and 34: Real estate transfer tax Real estat
Page 35 and 36: Grants and Incentives General Intro
Page 37 and 38: • R&D allowance / R&D premium: An
Page 39 and 40: Protection of Intellectual and Indu
Page 41 and 42: Immigration Migration to Austria Mi
Page 43 and 44: • Special cases of employment act
Page 45: Conditions for a residence permit T

Doing business in Austria - PKF

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