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Tax & Legal News in English | February 2024

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Tax-free employee bonus 2024


With the introduction of the employee bonus, the legislator has created the possibility of a tax-privileged bonus payment to employees for the calendar year 2024. The employee bonus is also seen as an extension of the inflation bonus for 2022 and 2023, however, the employee bonus is subject to stricter formal requirements. For example, companies that are members of an employers' association (such as the Austrian Chamber of Commerce) can only pay the employee bonus tax-free if the applicable collective bargaining agreement provides for such a payment in 2024. Most collective bargaining agreements were concluded before the end of the year and currently do not provide for an employee bonus.

 

Preconditions


In addition to the time and amount limits, there are formal requirements to be met to qualify for the tax-free employee bonus. Tax relief is only available if the full amount of the employee bonus is based on a wage-determining provision. Thus, the payment must be based on the applicable collective bargaining agreement or a company agreement authorised by the collective bargaining agreement. In companies without a works council, a contractual agreement with all employees is required to provide benefits, provided that the collective bargaining agreement allows for a works agreement. A contractual agreement with all employees is also required if the industry concerned is not covered by a collective bargaining association. These formal requirements distinguish the employee bonus from the inflation bonus. Further, the employee bonus must be – as the inflation bonus – an additional payment. The employee bonus and inflation bonus also share a common annual tax-free allowance with the tax-exempt employee profit-sharing. If both an employee bonus and an employee profit-sharing are granted tax-privileged in 2024, there is a joint annual tax-free allowance of EUR 3,000.00 per employee.

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

 

Practical implications of the new global minimum taxation


By the end of December 2023, Austria passed the Minimum Taxation Act (“Mindestbesteuerungsgesetz” – “MinBestG”), implementing the global minimum taxation into national law. The Global Minimum Taxation is intended to ensure that (multi-)national groups of companies with consolidated revenues of at least EUR 750 million are subject to an effective tax burden of at least 15 % worldwide. Compliance obligations generally apply to each constituent entity located in Austria. As the new rules impose a huge administrative burden, affected groups of companies and constituent entities should promptly deal with the transposition and implementation of the Global Minimum Taxation.

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

 

Generative AI: Risks and Opportunities in the Tax and Finance Sector


Generative AI is a specialized field of artificial intelligence that describes systems that create content that previously required human skills. This technology can be used for various tasks in the tax and finance sector, such as summarizing complex documents, drafting requirement catalogs, translating technical terms, analyzing financial statements, or creating internal reports. However, there are also risks and limitations associated with generative AI, such as the creativity of the model outputs, the transparency of the results, and the complexity of the requirements in tax and finance. Therefore, it is necessary to understand, analyze, and regulate the use of generative AI, and to define a team and a pilot project to implement it.

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

 

High Administrative Court on the recovery of wrongly refunded levies


The reclaiming of wrongfully refunded taxes by the tax authorities requires that the taxpayer's refund application has been dealt with by a formal (rejecting) decision.

If - as being common administrative practice in Austria between 2001 and 2013 - taxes were refunded by de facto repayment on the basis of an application by the taxpayer (ie without a formal decision being issued on the refund application), the reclaiming of a wrongly refunded tax requires that the tax authority first rejects the - still pending - refund application. A repayment notice pursuant to § 241a Federal Fiscal Code, which is issued without the refund application having been settled in advance, is therefore unlawful.

If the refund has been granted by a formal decision, a reclaim by means of Section 241a Federal Fiscal Code requires that the decision is cancelled first (if procedurally possible) and a rejecting decision is issued.

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

 

Digitalization of reporting of a reorganization


The Tax Amendment Act 2023 introduced an obligation for all parties of a reorganization, which was done under application of the Austrian Reorganization Tax Act, to make the mandatory notification to the tax authorities by way of an electronical filing via FinanzOnline. For parties without an Austrian tax identification number at the time of signing or passing the resolution for the reorganization it is still allowed to make a filing in writing via the newly introduced official form “Umgr 1”.

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VAT guidelines – final ordinance 2023

 

Important changes at a glance

 

The final ordinance 2023 was included in the VAT guidelines in December last year. The amendments result in particular from the incorporation of various Austrian higher court rulings respectively ECJ judgements and statements from the guidelines of the VAT Committee as well as the incorporation of the Tax Amendment Act 2023 and the CESOP Implementation Act 2023.

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

 

Expense reimbursement in home office


In a recent decision, the Supreme Court (27 September 2023, 9 ObA 31/23h) dealt with the reimbursement of expenses when working from home. Specifically, the case concerned an employee's claim against her employer due to her permanent relocation or work from home and the associated expenses.

The Supreme Court agreed with the legal opinion of the lower courts, according to which the employee was awarded EUR 2,227.50 net and considered a monthly expense allowance of EUR 135 net to be appropriate.

The decision raises numerous questions about the reimbursement of expenses when working from home. It is important to note that the legislator only expressly regulates the reimbursement of expenses for digital work equipment (required IT hardware and software, data connection or company mobile phone). Whether reimbursement is due for other costs, such as a desk, a work chair or pro rata operating and rental costs, is based on general principles of civil law and must always be examined on a case-by-case basis. It is therefore advisable to include a clear division of costs in the home office agreement.

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Tax Deadlines in March 2024

 

  • Advance VAT declaration for January 2024.
  • Standardized Consumption Tax for January 2024.
  • Capital Gains Tax for capital gains on debt securities for January 2024.


For an overview of all Tax Deadlines in March click here...