Anti-Fraud Act 2025

Value Added Tax (VAT)

Under the currently applicable VAT rules, the rental of real estate for residential purposes is mandatorily subject to VAT at 10%, which generally entitles the lessor to an input tax deduction on related expenses.

For the rental of “particularly representative properties” (so-called “luxury real estate”) for residential purposes, a restriction of the input tax deduction is to be introduced in the future. Accordingly, the rental of luxury real estate for residential purposes will be exempt from VAT without the possibility to opt for taxation under Sec 6 para 2 VAT Act (UStG).

A property qualifies as a luxury property if the acquisition or construction costs for the residential property, including ancillary buildings and other structures, exceed MEUR 2 within a period of five years from the start of acquisition or construction. For rental objects (e.g., apartment buildings), the MEUR 2 threshold is determined on a per-unit basis.

Under the new regulation, the rental of such luxury properties will thus be mandatorily VAT-exempt, and no input tax deduction will be allowed for expenses related to acquisition, construction, or ongoing costs.

The new rules are generally intended to apply to transactions and other relevant matters executed after 31 December 2025, and an additional requirement for application is that the luxury property is acquired or constructed by the lessor after 31 December 2025.

PrincipalLiability for Construction Services

If an entrepreneur subcontracts construction services to another company (subcontractor), under current law the entrepreneur is liable for up to 5% of wage-related taxes and up to 20% of social security contributions. The provision of construction services through leased personnel (“Arbeitskräftegestellung”) is also subject to these liability rules. Construction services are defined as all services related to the construction, repair, maintenance, cleaning, alteration, or demolition of buildings.

If the services are provided through the leasing of personnel, the liability rates are to be increased as of 1 January 2026 to 8% for wage-related taxes and 32% for social security contributions and levies.

As before, no liability arises if the subcontractor is listed in the HFU register or if the liable amounts are paid to the service center of the Austrian Health Insurance Fund (ÖGK).

Fiscal Penal Code

• Penalty surcharge under fiscal penal law

Currently, after audit measures fiscal penal consequences can be avoided if a surcharge amounting to 10% is voluntarily paid. One of the prerequisites for such surcharge is that the tax assessments which are relevant under fiscal penal law does not exceed EUR 33,000. The proposed changes raise this threshold to EUR 100,000, but the amount per assessment period shall not exceed EUR 33,000. If the relevant tax assessments exceeds the amount of EUR 50,000, the surcharge should be raised to 15%.      

• Tax losses and fiscal offense

Under current law, a fiscal penal offence is committed if a tax is omitted. A tax is omitted if the tax amount is underassessed. Therefore, in a fiscal year in which negative income was earned in case an overstated loss was declared no tax was omitted. The fiscal penal liability was only intended in the year of the use of such overstated loss.

Going forward, an overstated loss in a tax return shall be punishable under fiscal penal law. It shall be treated equal to an underpayment of taxes in a year with positive income. The omitted amount shall be calculated as follows: the absolute value of the overstated loss shall be multiplied with the relevant applicable tax rate.

The amendments shall take effect as of 1 January 2026, and the fiscal penal liability will apply for the first time to tax returns filed after the entry into force of this regulation.

Federal Tax Code (BAO)

• Cash payments of taxes.

From 1 January 2026, cash payments of taxes will be limited to a maximum of €10,000 per day.

• Exemptions from insolvency clawbacks

Starting 1 January 2026, value-added tax, payroll tax, and—under certain circumstances—capital gains tax paid by the taxpayer to the tax authorities before the opening of insolvency proceedings will, by law, be excluded from insolvency clawback provisions under the Austrian Insolvency Code. Similarly, any liens or other security interests established or acquired to secure these taxes shall be exempt from insolvency clawback

If the debtor’s assets are sufficient to cover the initial costs of the insolvency proceedings, the insolvency clawback will be entirely precluded. Otherwise, the insolvency clawback will be excluded only for amounts exceeding EUR 4,000. The same rules will also apply to social security contributions. 

In insolvency proceedings, the proceeds from the realization of a property that is subject to a secured claim pursuant to § 48(1) of the Insolvency Code (IO) constitute a separate estate (“Sondermasse”). Going forward, from this separate estate, the real estate capital gains tax or the special prepayment under § 30b(4) of the Income Tax Act (EStG) is to be satisfied together with other public charges payable from the property that rank according to § 216(1) no. 2 of the Execution Code (EO).

Income Tax Act (ITA)

Currently, donations from foreign foundations that are comparable to Austrian private foundations are taxed as income from capital assets. Going forward, contributions from foreign foundation-like entities not equivalent to an Austrian private foundation will be also taxed as income from capital assets, based solely on an abstract comparison with a private-law foundation.

Vehicle Tax (NoVA) 

Changes will include restrictions on the refund of vehicle tax when a vehicle is sold abroad, as well as administrative simplifications and clarifications.

Other Reporting-Measures

In addition, measures are to be implemented to combat fraud in the tax and contributions system, in particular in the following areas.”

• Crypto Reporting Act

The Act will implement EU requirements on mandatory automatic information exchange for reportable crypto service providers and cooperation with third countries under global taxation standards. The reporting obligation applies to both cross-border and domestic transactions. It affects providers authorized under the MiCA regulation in Austria or those with a domestic tax nexus, provided no stronger connection to a foreign country exists.

• Common Reporting Standard Act (CRS Act)

The changes expand due diligence and reporting obligations for financial institutions on accounts already covered under the CRS and introduce reporting obligations for new digital financial products, such as electronic money, central bank digital currencies, and crypto-assets. These measures aim to implement recent international developments in the automatic exchange of financial account information.

• EU Mutual Assistance Act

The automatic exchange of information will be extended to include dividends from companies whose shares are not held in bank deposit accounts and are not exempt under the EU Parent-Subsidiary Directive.

The scope of reporting will also cover cross-border advance rulings and prior agreements on transfer pricing for individuals, where transaction amounts exceed €1,500,000 or where the tax residence of a person is established.

• Transfer Pricing Documentation Act

Companies will be required to report the tax identification number issued by their residence country.

• EU Reporting Obligations Act

Reporting obligations will be clarified, including the requirement to submit information that could assist authorities in assessing tax risks and the tax identification number issued by the residence country.

• Digital Platforms Reporting Act

Definitions will be standardized, and clarifications provided regarding the deletion of digital platform operators.

• Banking Act

Financial institutions will have the option to report information under either the Crypto Reporting Act or the CRS Act if the requirements of both laws are simultaneously met.

• Account Register and Account Inspection Act

Reports submitted to the account register shall be treated as tax returns, and the Federal Tax Code (BAO) shall be applied mutatis mutandis for the purpose of monitoring compliance with the provisions.

In addition, reporting obligations of the obliged financial institutions shall be fulfilled within the framework of measures pursuant to § 144 BAO (“Nachschau”), § 147 BAO (tax audit), and § 153a BAO (horizontal monitoring).

The final enactment of the government draft remains to be seen.