Foreign researchers or scientists in Austria, relocated from abroad, might be entitled to favourable tax treatment if the relocation is in Austria´s public interest. There exists two tax privileges:
The first tax advantage can also be applied by athletes and artists moving to Austria. In practice, however, the tax allowance (so-called "Zuzugsfreibetrag") is by far the most frequently applied type of immigrant allowance.
The allowance is 30% of the income from domestic and foreign scientific activities, insofar as these are taxed according to the progressive tax rate. The allowance is granted for a period of five years and can be taken into account in payroll accounting as well as in the yearly tax assessment. This tax advantage is intended to compensate for the additional costs of moving to Austria (such as differences in the price level, costs for moving, costs for double household management including travel costs and costs for language courses). If the tax-free allowance is granted, no other operating expenses, income-related expenses or exceptional charges connected with the relocation can be claimed.
The application for granting the tax allowance for moving must be submitted in writing to the Austrian Federal Ministry of Finance (BMF) within six months of moving in. The application must be accompanied by a list containing the following information:
Furthermore, a supplement must be attached to the annual tax return in which the following information is disclosed:
According to the opinion of the tax authority, one of the basic prerequisites for granting the allowance is that the centre of the researcher's or scientist's life interest is relocated to Austria. The Federal Fiscal Court (BFG 18.07.2017, RV/7100774/2017) confirmed this view, according to which merely establishing domestic residence is not sufficient for the granting of the tax allowance (case still pending before the Administrative Court under No. Ro 2017/13/0018).
Scientists and researchers switching their “centre of vital interest” (controversial; this question still pending at the Administrative Court) to Austria are entitled to claim an additional tax allowance of 30% of taxable income from domestic (and partly also foreign) scientific and research activities for a period of up to five years. The relocation has to be in the public interest for Austria because it supports science and research. An application for obtaining the tax benefit must be filed with the Austrian Ministry of Finance within six months of the date of moving to Austria.
WTS Austria has already successfully completed tax applications for scientists and researchers from different countries such as Hungary, Germany, Spain, Poland, Russia and Switzerland. Our experts at WTS Austria will be pleased to advise you in your individual situation.
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