Understanding Vat Charges In Austria: What You Should Know

Austria implemented a European Value Added Tax (VAT) regime in 1973, replacing its sales tax. The Value Added Tax (VAT) in Austria is known as Umsatzsteuer (USt) in German. Austria has three different tax rates: one standard VAT rate and two reduced VAT rates. The standard VAT rate is 20% (19% in the regions of Jungholz and Mittelberg). The standard VAT rate generally applies to all goods and services for which no exemption, 0% rate, or one of the reduced VAT rates is foreseen. The first reduced VAT rate is 13% and applies to cinema and sporting event tickets, swimming pool visits, and the importing of artworks, among others. The second reduced VAT rate is 10% and applies to groceries, rent, and public transport tickets, among other things.

Who is liable to pay VAT in Austria?

In Austria, the Value Added Tax (VAT) is called Umsatzsteuer (USt) in the local language. The Austrian VAT rules are incorporated in the Value Added Tax Act 1994, which was enacted to implement the European Union VAT rules. The Austrian VAT system follows the European Union regime, which is laid out in the EU VAT Directives.

Businesses registered for VAT in Austria must use the standard and reduced VAT rates when supplying goods and services. If they fail to charge the correct rates, they are held liable for any unbilled VAT. The standard VAT rate is 20% (19% in the regions of Jungholz and Mittelberg). The standard rate applies to all goods and services for which no exemption, 0%, or one of the reduced VAT rates is foreseen. The first reduced VAT rate is 13%, which applies to tickets to sports and cultural events, domestic flights, pet food, and artists' services or products, among others. There is also a reduced VAT rate of 10%, which applies to most food products, books, hotel accommodations, rentals for residential purposes, newspapers, magazines, restaurants, passenger transport, pharmaceuticals, and the repair of certain products.

Some supplies are VAT-exempt, such as health services and financial services. Additionally, some goods and services are subject to 0% VAT, such as exports or intra-Community supplies.

Foreign companies providing taxable supplies of goods or services in Austria may need to contact the tax authorities and register for VAT. This obligation can be triggered by various situations, including importing goods into Austria from outside the EU, intra-community sales or purchases of goods from another EU country, and buying and selling goods within Austria.

What are the VAT rates in Austria?

The Value Added Tax (VAT) in Austria is known as Umsatzsteuer (USt) in German. Austria has three different tax rates: one standard VAT rate and two reduced VAT rates. The standard VAT rate is 20% (19% in the regions of Jungholz and Mittelberg). This standard rate applies to most goods and services for which no exemption, 0% rate, or reduced rate is foreseen.

The first reduced VAT rate is 13%. This applies to tickets to sports and cultural events, domestic flights, pet food, artists' services and products, cinema tickets, swimming pool visits, and the importing of works of art.

The second reduced VAT rate is 10%. This applies to most food products, books, hotel accommodations, rentals for residential purposes, newspapers, magazines, restaurants, passenger transport, pharmaceuticals, and the repair of certain products.

Supplies and services at 0% are standard supplies, such as exports or intra-Community supplies. Additionally, some supplies are VAT exempt, such as health services and financial services.

Businesses registered for VAT in Austria must use these rates when supplying goods and services and are held liable for any unbilled VAT.

What is Austria's VAT compliance process?

Austria's VAT compliance process is subject to rules set by the EU, but the country is free to set its standard VAT rate and levy reduced rates on certain goods and services for economic reasons. The standard VAT rate in Austria is 20% and is applied to most goods and services, including ebooks, software, music, etc. There are also reduced VAT rates of 13% and 10% for specific items.

Businesses registered for VAT in Austria must adhere to the set rates when supplying goods and services and are held liable for any unbilled VAT if they fail to charge the correct rates. The VAT compliance process in Austria includes several specific requirements:

• Invoicing: Businesses must issue invoices with the disclosure details outlined in the Austrian VAT Act and prepare e-invoices.
• Record-keeping: Businesses are required to maintain accounts and records for at least seven years.
• Customer invoicing: Businesses must correctly invoice customers for goods or services in accordance with the Austrian time of supply VAT rules.
• Credit notes: They should also process credit notes and other corrections accurately.
• Foreign currency: Businesses must use approved foreign currency rates when invoicing in foreign currencies.
• Tax point determination: Understanding the tax point (time of supply) rules is crucial, as VAT becomes due 10 days after the VAT reporting period ends (monthly or quarterly). For goods, it is typically the time of delivery, while for services, it is the completion of the service.

Non-resident businesses selling digital products or services to Austrian customers should be aware of additional considerations, such as determining the taxability of their products, registering for VAT, and understanding their VAT obligations in the country.

How does VAT work on imports to Austria?

The Value Added Tax (VAT) in Austria is known as Umsatzsteuer (USt) in German. While the EU sets the VAT compliance rules, Austria can set its standard VAT rate and levy reduced VAT rates on a limited range of goods for economic reasons.

In Austria, you pay VAT on the import of goods from other countries. If you are importing goods into Austria from a non-EU country, you will have to pay customs duty and import VAT, and possibly excise duties. The import VAT is collected directly at the time of parcel delivery. The amount of customs duty depends on the goods themselves, their value, and their country of origin.

The standard VAT rate in Austria is 20% (19% in the regions of Jungholz and Mittelberg). The standard rate applies to most goods and services for which no exemption, 0%, or one of the reduced VAT rates is foreseen.

The first reduced VAT rate is 13%. This reduced rate applies to tickets to sports and cultural events, domestic flights, pet food, artists' services or products, and cinema tickets.

The second reduced VAT rate is 10%. This applies to most food products, books, hotel accommodations, rentals for residential purposes, newspapers, magazines, restaurants, passenger transport, pharmaceuticals, and the repair of certain products.

Some supplies are VAT-exempt, such as health services and financial services.

How do I get a VAT refund in Austria?

To get a VAT refund in Austria, you must meet several requirements. Firstly, you must be a traveller who is not domiciled in the EU, with a passport or cross-border travel document indicating a domicile outside the EU. Additionally, the invoiced amount of your purchases, including VAT, must exceed EUR 75.

Step 1: Obtain the Necessary Forms

When making a purchase, look for the Planet Tax-Free logo and ask for a Planet Tax-Free form. You will need to ensure that your form is fully completed and includes all the necessary information.

Step 2: Get Customs Validation

Before leaving the EU, go to one of the designated DEV (Digital Export Validation) areas. You can use your mobile device to carry out digital export validation by connecting to the DEV WiFi, or you can use one of the self-service kiosks. If your goods are in your carry-on luggage, you can get them validated at a DEV counter near your boarding gate. Remember to bring your passport and travel documents, as these will be required for customs approval.

Step 3: Export the Items

You must export the items from the EU before the end of the third calendar month following the month of purchase. This means that if you bought an item in January, you must export it by the end of April.

Step 4: Prove Export of the Item to the Seller

Return to the seller to prove that you have exported the item. This can be done by presenting the necessary documents, including your passport, travel documents, and proof of export validation.

Step 5: Receive Your Refund

There are several ways to receive your refund. You can visit any Planet Refund Office and present your validated Tax-Free forms and shop receipts. If you haven't received your refund at a refund point, you can provide your payment details on the Tax-Free form and return it along with the shop receipts by post using a prepaid envelope. Alternatively, you can leave your form and receipts in a Planet drop box.

It's important to note that your goods must be new and unused to qualify for a VAT refund. Additionally, make sure to allow enough time for the customs approval process before your flight departs.

Frequently asked questions