Tax & Legal News in English April 2026

Unproven positive market value in case of a contribution

The Federal Fiscal Court confirmed that a positive market value is a mandatory prerequisite for a tax-neutral contribution under the Reorganization Tax Act. If this positive value cannot be demonstrated at the contribution date, the transfer cannot qualify for tax benefits under Art III Austrian Reorganization Tax Act and must be treated as a taxable sale. The court emphasized the need for a credible, standalone expert valuation, rejecting overly optimistic or unverifiable forecasts. This decision underlines the importance of thorough planning and proper documentation in corporate restructurings to secure favorable tax treatment.

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NaBeG: Changes in Disclosure of Financial Statements

The NaBeG (Sustainability Reporting Act) introduces important changes to the disclosure of annual and consolidated financial statements, including expanded reporting declarations, simplified filing requirements, and stricter penalties for non-compliance. From 1 July 2026, companies and their legal representatives will face broader disclosure obligations, particularly in relation to sustainability, corporate governance, and consolidated reporting. At the same time, the signature requirement for financial statements will be abolished, and publication via the EVI platform will end. Overall, the reforms are intended to increase legal clarity, transparency, and enforcement efficiency. To still benefit from the previous (more limited) scope of regulations, it is advisable to disclose the annual financial statements no later than 30 June 2026.

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No Loss Carryforward after Corporate Transformation of a GmbH

A recent decision of the Federal Fiscal Court clarifies that losses from a GmbH (limited liability company) cannot be carried forward for tax deduction after its conversion into a sole proprietorship if the business undergoes significant changes, such as a drastic drop in revenue, leading to a lack of comparability with the original loss-generating operation. The decision emphasizes that loss carryforwards are only transferable if the underlying business remains substantially unchanged in scope and nature. It is therefore advisable to plan restructurings at an early stage in order to be able to utilize any existing tax loss carryforwards.

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Administrative High Court clarifies documentation requirements for tax-neutral substance contributions of a Liechtenstein foundation

In its recent decision (VwGH 18.11.2025, Ra 2023/13/0027), the Administrative High Court (VwGH) ruled that contributions from foreign foundations may, in principle, qualify as tax-neutral substance contributions (Substanzauszahlungen) if the statutory requirements are met. However, the Administrative High Court rejected the appeal, as the requirements for a tax-neutral substance contribution were not sufficiently demonstrated.

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CJEU Judgment on Ancillary Services in the Accommodation Sector – Confirmation of the Apportionment Requirement

On 5 March 2026, the Court of Justice of the European Union (CJEU) issued its judgment in the joined cases C-409/24, C-410/24 and C-411/24 concerning the VAT treatment of ancillary services in the accommodation sector. The Court addressed whether such services must follow the VAT treatment of the principal accommodation supply or may be taxed separately. It confirmed that national apportionment rules are compatible with EU law, allowing Member States to apply reduced VAT rates selectively to specific elements of a service.

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Transfer Pricing and VAT: The VAT Treatment of Transfer Pricing Adjustments 

On 4 September 2025, the CJEU ruled in Arcomet Towercranes (C-726/23) that transfer-pricing-based payments may constitute taxable consideration for VAT purposes where they are linked to specific intra-group services. On 15 January 2026, Advocate General Kokott further stated in Stellantis Portugal (C-603/24) that the VAT treatment of transfer pricing adjustments depends on their connection to a specific supply and that, depending on the circumstances, they may qualify as consideration, an adjustment of the taxable amount, or as not taxable for VAT purposes. Together, these developments confirm that transfer pricing adjustments cannot be assessed uniformly for VAT purposes but must be analyzed in light of their concrete legal and economic function.

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Changes resulting from the amendment to the Traffic Regulation
New developments for e-bikes, e-mopeds- e-scooters and camera-based access management

On February 25, 2026, the government proposal to amend the Road Traffic Regulations (StVO) and the Motor Vehicle Act (KFG) was submitted to the National Council. The amendment was approved by the Federal Council on April 10, 2026. The first changes will take effect as early as May 1, 2026.
The changes primarily concern the helmet requirement for e-bikes and e-scooters, as well as the equipment required for e-scooters. From now on, e-mopeds will be classified as motor vehicles and may no longer be ridden on bike paths. E-mopeds therefore require a license plate and liability insurance. A driver’s license and a helmet are required to ride them.
The camera-based access control system is designed to enforce certain prohibitions and requirements under the StVO through license plate recognition. The rationale behind this measure is that the Vienna City Government aims to reduce traffic in the First District using cameras and ensure that only authorized vehicles are permitted to enter the district.

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“Tropical Island” – Emotional appeals in e-liquid marketing are
prohibited

In its judgment Ra 2024/11/0067-9 of October 22, 2025, the Austrian Administrative High Court (VwGH) overturned a decision of the Vienna Administrative Court, which had dismissed proceedings against a company representative for placing on the market an e-cigarette refill container labeled “Tropical Island” with a palm beach sunset image. The VwGH held these elements unlawfully suggest lifestyle benefits – such as relaxation and exotic vacation experiences – from the average consumer’s perspective, particularly young people, thereby contravening Austria’s Tobacco and Non-Smokers’ Protection Act (TNRSG) and EU Tobacco Products Directive (TPD II). Emphasizing a realistic, consumer-oriented assessment over abstract arguments (e.g., reference to climate change, non-appeal), the Court confirmed that even indirect and subtle emotional appeals may be prohibited. The ruling reinforces a strict neutrality requirement for product design, aimed at reducing consumption and protecting public health. It is likely to have broader implications beyond e-cigarettes, particularly for emerging categories such as tobacco-free nicotine products.

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Limits of balance sheet corrections

In its decision of 24 April 2025 (Ra 2023/15/0112), the Austrian Administrative Supreme Court clarified that balance sheet corrections via profit adjustments under Sec 4 (2) (2) Austrian Income Tax Act in conjunction with Sec 293b Austrian Fiscal Code are strictly limited to errors originating from already time-barred periods. In the case at hand, the tax authority made a profit adjustment in the first non- time-barred year (2012) not only regarding time-barred years (2003–2011), but also for 2012 itself.
The Court held that Sec 4 (2) (2) Austrian Income Tax Act cannot be extended to errors originating from non-time-barred years. Consequently, the profit adjustment relating to 2012 was deemed unlawful.

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NaBeG Explained Simply – Changes in Accounting

Due to the new provisions of the NaBeG, companies should carefully assess whether the new option of net accounting for discounts on issuance (“disagio”) is advantageous in their specific case for financial years beginning after December 31, 2026. In this context, a comparison of the effects of applying the effective interest method versus straight line amortisation should also be performed. Notwithstanding the available accounting options, it should be noted that any option chosen must be applied consistently.
At the same time, it should be noted that material debt issuance costs may no longer be recognised immediately as an expenses in the future, but must be allocated over the term of the liability, as already known from tax accounting. It is therefore advisable to already take this into account accordingly in day‑to‑day bookkeeping.

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