Tax & Legal News in English December 2025

No binding effect of A1 certificates in the issuing state

The Austrian Administrative High Court confirms in his decision of 6 May 2025, that A1 certificates have binding effect only externally - that is, toward authorities of other EU member states - but not within the issuing state itself. National authorities and courts may independently assess whether the relevant social security legislation applies, even if an A1 certificate has already been issued. As a result, neither employers nor employees can rely on an A1 certificate as legally conclusive within Austria, and internal legal remedies remain available. Careful coordination with social security institutions is therefore essential to avoid unexpected conflicts or divergent assessments.

For contact details and more information in German click here...

Private apartment as a permanent establishment

The Austrian Administrative High Court (VwGH) dismissed the appeal against a decission by the Regional Administrative Court of Upper Austria. As a result, the ruling of the Regional Administrative Court remains valid, according to which the managing director’s residence in Austria constitutes a municipal tax permanent establishment if business-related activities—such as coordination, emails, and phone calls—are regularly carried out there. The fact that the managing director is part of a German company does not change this assessment, particularly when the company’s business activities are primarily focused on Austria.

For contact details and more information in German click here...

The OECD Model Tax Convention 

On 19.11.2025, the OECD published the 2025 Update of the OECD Model Tax Convention (OECD-MTC) and the associated Model Commentary (OECD-Commentary). The focus of the 2025 update was in particular on the changes in new ways of working, such as home office or workation. Furthermore, there were some clarifications and explanations in the OECD-Commentary, as well as a new, alternative treaty provision for Art 5 regarding the taxation of raw material extraction in the mining country. The publication of the new complete OECD-MTC is scheduled for 2026. In the following, we would like to discuss the changes to remote working and home office.

For contact details and more information in German click here...

General Court confirms application of the triangular transaction scheme in a four-party chain

In its ruling, the General Court confirms that the simplification rule for triangular transactions can also apply to chain transactions involving more than three parties if the principle requirements for triangular transactions are met. This is in line with the legal opinion that has been held in Austria since 2023. The ruling of the General Court is particularly relevant for those EU Member States that have not previously held the same view.

For contact details and more information in German click here...

Simplifications for cash register regulations and obligatory generation of the "annual receipt"

Recent legislative developments provide for certain simplifications regarding the use of cash registers and the issuance of receipts. In particular, it will be sufficient for customers to be able to access the receipt content on-site without the need for direct electronic transmission. Furthermore, the turnover threshold for specific simplification rules under the Cash Turnover Regulation is increased to EUR 45,000.
For each cash register, the preparation of an annual receipt is required at the end of the calendar year. The receipt must be printed out as an “annual receipt”, checked by using the “BMF Belegcheck”-App and kept for seven years. Certain cash registers can alternatively create the annual receipt electronically and transmit it to FinanzOnline via the cash register web service. You need the annual receipt, which depending on the type of cash register has to be checked manually or is checked automatically, for the mandatory check of the tamper protection of your cash registers. It should be noted that the verification of the annual receipt (whether manual or automated) must be performed no later than 15 February 2026. If the check is carried out after 15 February 2026, this may fulfill an administrative fiscal penal offence (“Finanzordnungswidrigkeit”) and result in a fine of up to EUR 5,000 per offender.

For contact details and more information in German click here...

Administrative Court on the assessment basis of the Austrian R&D premium

In Austria, companies may claim an R&D premium for in-house research amounting to 14% of the research expenses or expenditure eligible for the premium. Contrary to the decision of the Tax Appeals Court (BFG), the Administrative Court (VwGH) ruled in its decision of 30 September 2025 (Ro 2024/13/0017) that the deduction limitation under Sec. 20 (1)(7) of the Income Tax Act (EStG) is not relevent for calculating the R&D premium. The assessment basis for the research premium does not have to be reduced by the limit for manager salaries of EUR 500,000.00 per year and person. Potential implications for past and still pending proceedings should be examined. The amended FoPV (Research Premium Regulation) published on December 18, 2025, stipulates, contrary to the decision of the Administrative Court, that research expenses are to be taken into account at the amount that is effective as business expenses in accordance with the regulations governing the determination of taxable income.

For contact details and more information in German click here...

VAT guidelines – maintenance ordinance 2025

The final ordinance 2025 was included in the VAT guidelines in December last year. The amendments result in particular from the incorporation of various Austrian higher court decissions respectively ECJ judgements as well as – amongst others – from the incorporation of the Budget Accompanying Act 2025, the Budget Consolidation Act 2025 and various technical information from the Austrian Federal Ministry of Finance.

For contact details and more information in German click here...

Uniform User Management & Digital Signatures

From January 1 2026, the new EU-wide standardized access system UUM&DS – Unified User Management & Digital Signatures – will be mandatory for numerous central IT applications of the European Union in the customs sector. This will replace the current login via the Business Service Portal (USP) for these central EU applications with a central EU login-based solution. UUM&DS will be used for applications in the areas of customs and CBAM

For contact details and more information in German click here...

Revised Rules: Modernized rules of origin and cumulation in the Pan-Euro-Mediterranean (PEM) area

From 1 January 2026, in the Pan-Euro-Mediterranean (PEM) area, only the revised preferential rules of origin of the revised PEM Convention will apply in principle for those contracting parties that have ratified them. Contracting parties that have not ratified them will remain subject to the old rules of origin; this will create two cumulative zones from 2026 onwards, in each of which mutual cumulation is only possible under the respective set of rules.

For contact details and more information in German click here...