Austria

Tax measures – Direct and Indirect     |     Employment-related measures     |     Economic stimulus measures     |     Measures to ease the lockdown     |     Other measures and sources     |     Customs Measures

Return to homepage  |  Last updated: 9 September, 2020

Click here to see a comprehensive summary of jurisdictional tax measures and government reliefs in response to COVID-19.

Short-time work

• The working hours of the employees are reduced between 10% and 90% and their salaries are adjusted accordingly.
• The employer pays the employees a financial support (short-time-work support) for their loss of earnings.
• In total, the employee has to receive at least a certain amount of his previous net salary (“net remuneration guarantee”) during the newly established model of short-time work for the coronavirus-crisis.
• The employer receives a financial support from the Public Employment Service (AMS) on the basis of flat-rates determined by the AMS (short-time-work allowance).
• The company must be affected by temporary economic difficulties which are not seasonal. Economic difficulties caused by the coronavirus are covered.
• A new model for the coronavirus-crisis was established which can be concluded for a maximum of 3 months (Phase I: April, May and June 2020). If necessary, it can be extended by a further 3 months after discussions with the social partners (Phase II: July, August September 2020). Additionally Phase III starting from 1. October 2020 over 6 months.

In order to react to the current circumstances regarding shut-downs of businesses, with retroactive effect from 1.3.2020, a new short-time-work model came into force which provides for significant improvements:

• Shortened application periods,
• Higher funding
• Eased application process.

Parental leave

• Granting of 3 weeks of exceptional leave and coverage of one third of the related costs for any employee faced with the care of a child under 14 years of age;

Self-employed professional & gig workers

• Two billion fund to cover living costs of self employed & gig workers and mini-companies

Sectorial support measures:

• Austria is introducing support measures for sectors heavily affected by the outbreak, such as tourism and air transportation, and uses existing measures to reduce hours worked (“Kurzarbeit”). EUR 100 million are available for loans to hotels that suffer more that 15% losses in sales. The maximum is 80% of the loan or EUR 500 000.

Loan guarantees:

• The Austria Wirtschaftservice (AWS) is providing new guarantees for SMEs worth EUR 10 million up to 80% of the loan amount or EUR 2,5 million for 5 years. The guarantees will have a one-time processing fee starting with 0.25 % of the amount to be financed and a guarantee fee, starting with 0.3 % p.a. (variable to risk) of outstanding liability.

Crisis management fund:

• On 13 March, a EUR 38 billion COVID-19 crisis management fund was announced.

The measures include:

• EUR 4 billion in funding, this include
  • 2 billion for hardship cases (“Härtefallfonds”): The hardship fund is a federal government subsidy for the self-employed. With the funding instrument, entrepreneurs should receive support for their personal living costs. The application deadline is on 31st December 2021.
  • 2 billion for immediate help for badly affected companies (“Soforthilfe”)
• EUR 9 billion in guarantees and warranties (80%, 90% or 100% federal guarantees for 5 years)
• EUR 15 billion in emergency aid (Corona-Hilfs-Fond), this include
  • funds for fixed costs (“Fixkostenzuschuss”): In order to maintain the solvency of companies in connection with the spread of COVID-19, the fixed costs of affected companies are to be covered proportionally by a fixed cost subsidy. Application deadline is on 31st August 2021. A fixed cost grant 2 is being planned.
  • value added tax reliefs for restaurants (“Wirtshauspaket”)
• EUR 10 billion in tax deferral, this includ
  • edeferrals social security contribution
  • reduction / non-assessment of (corporate) income tax advance payments 2020
  • deferral of tax payments for exemption from deferred interest and late payment surcharges
• Bonuses for new investments (up to 14% of the acquisition costs; Ecological, Digitalization and LifeScience investments) (“Investitionsprämie”): Climate-damaging investments or investments in undeveloped land, in financial assets, takeovers or in capitalized own work are excluded. The bonus can be requested for investments made after August 1,2020 until February 28, 2021.
• Funds for Film and TV productions: This enables film production companies to continue filming that has been interrupted or postponed due to COVID-19.

Start-ups: Loans do not work for many startups because the criteria disqualify quite a few:

• Venture Capital Fonds
• COVID-Start-up-funds (“Covid-Start-up-Hilfsfonds“): AWS is doubling the private equity that investors have brought into a start-up. This grant cap has already been exhausted. Thus Start-ups cannot apply any more.
• Deferral of fund repayments and additional funding programmes

Other measurements:

• NPO-funds (“NPO-Unterstützungsfond“): The Austria federal government supports non-profit organizations from the social sector to culture to sports, voluntary fire brigades or legally recognized religious communities with grants. Application deadline is on 31st December 2020
• Grants for location security: (“Standortsicherungszuschuss“): This grant serves to maintain the solvency of companies relevant to the location. Application until 31st August 2021.

Public parks, small shops, DIY and gardening supply stores reopened with strict distancing rules and masks. Larger shops and hairdressers are due to open from 1 May. Restaurants in mid-May. On 14 April, small shops (under 400 square metres), as well as hardware stores and garden centres will open. Masks will be compulsory inside, with a maximum of one person per 20 square metres. On 1 May, all shops will open unless decided otherwise, and restaurants and hotels will follow by mid-May at the earliest. However, the government reserves the right to pull the “emergency brake” at any time and reverse the openings if the numbers demand it. There will still be no events until the end of June and schools will continue with homeschooling until mid-May. For students, the current semester will probably be completely digital, and examinations and research at universities will continue to take place, as long as it remains possible. The issue of freedom to travel has become a particularly hotly debated topic and Kurz caused a stir at the weekend with a broadcast message announcing that freedom to travel will only be granted once a vaccine is ready for use.

Duty Relief:

• Exemption from import duties for disaster victims: In the case of goods of any kind which are made available free of charge to victims of disasters (e.g. protective masks, protective suits, respiratory equipment, etc.), the duty-free importation may also take place where the goods are acquired against payment.

Beneficiaries:

• State or competent authority recognized charitable organizations, local authorities, Caritas, Red Cross, SOS Children's Villages, whereby the goods must be made available to the victims free of charge
• According to a press release, supplies of goods - such as protective clothing, masks, etc.,  needed to combat the effects of the COVID 19 outbreak in 2020 – within Austria and within  the EU will be exempt from duties and VAT.
• KPMG is currently clarifying with the ministry how / wether this exemption will also apply to  imports for commercial importers (e.g. retail trade), as in the commission decision 2020/491  only following bodies and organizations are mentioned: “by or on behalf of State  organizations including State bodies, public bodies and other bodies governed by public law  or by or on behalf of organizations approved by the competent authorities in the Member  States.”

Customs audits

• The submission of accompanying documents in paper form is waived. Documentary checks are suspended to this extent, where it is not possible for the economic operator to access the documents (teleworking).
• Therefore, until further notice, all external audit activities, inspections and surveys of failure, suspension or interruption of any resources on the part of those concerned necessary. It is therefore not necessary to establish prima facie evidence, it must be assumed officially that no obligations to cooperate on the part of the companies can be fulfilled.

Payment facilities

• Payment facilities - security deposit - interest on loans: Also in the area of customs,  interest for deferral and late payment surcharges will be reduced to an amount of up to zero  euros or not set at all if there is a specific case of concern. Payment facilities (e.g. payment  by instalments) may be granted and payment deadlines may be suspended if the party  involved is threatened with irreparable damage due to the pandemic. Interest on arrears for  late payments until 31 May 2020 will generally be suspended due to the  pandemic.
• The security deposit may be waived if this would lead to considerable economic or social  difficulties due to the pandemic. In the event of a liquidity bottleneck due to the SARS-CoV-2  virus, the provision of security must be waived or no interest on loans will be  charged.
• Failure to apply for remission and refund (the right to apply for remission and refund does not  lapse in the event of unforeseeable circumstances or force majeure). If certain customs  formalities, such as the export of the goods within the deadline, are linked to the application,  this deadline does not expire due to unforeseeable circumstances or force majeure.
• Security deposits: If the reference amount set by the customs offices with the companies  has changed due to a pandemic, the holders of an authorisation to provide a comprehensive  guarantee may request that the reference amount be changed and adapted to the  circumstances.
• Administrative charges: Customs offices do not charge administrative fees for handling  pandemic-related delays in the above-mentioned cases.

Extension of deadlines:

• If deadlines are not met due to pandemic-related circumstances, the deadlines are still considered to have been met or applications may be submitted after the regular application deadline. Applications for exceeding or extending the deadlines must be justified accordingly. There are facilitations for the following cases:
  • Exceeding the obligation to present the goods under the transit procedure (corresponding simple declaration by the carrier or the holder of the procedure (even retrospectively) with a brief explanation of how the delay occurred)
  • Special procedures (temporary storage, active and passive processing): periods for completion of the special procedures may be extended by a reasonable period on request.
  • Returned goods: If the three-year period for free of duty re-importation of returned goods is exceeded due to a pandemic, this shall be considered a special circumstance and shall be reviewed“
• Interruptions to deadlines : in the tax proceedings and in the financial criminal proceedings,  the course of important deadlines is therefore interrupted in the area of legal protection. This  includes the deadlines for appeals, objections, submissions and measures, which were still  open on 16 March 2020 or which started between 16 March and 30 April. These deadlines  are interrupted until 1 May 2020.

Excise

• Amendment of Section 17(1) and (3) of the Alcohol Tax Act:
  • owners of user companies are allowed to carry out certain denaturing (e.g. for disinfectants) themselves on request without the presence of customs authorities.
• Amendment of §§ 116l, m and n of the Alcohol Tax Act:
  • if a product used for the production of disinfectants for hand disinfection and surface disinfection, and which has been taxed at the standard rate, is taken into an establishment of use, a tax refund shall be granted for the period of increased demand. In addition, due to the urgency of the current demand, a simplified denaturing method will be determined by law, which can be carried out without a permit and without the presence of customs authorities (validity 1.3.2020 to 31.8.2020).
  • a free license can be issued retroactively for production after 31.1.2020 and before 15.3.2020.

Main sources of information

• Austria chamber of commerce Notice of 24th of March 2020
• Austria Customs authorities’ Notice of 27 march 2020
• Austria: Tax relief measures regarding coronavirus (COVID-19)
• Austria: Additional tax relief, in response to coronavirus (COVID-19)
• Aid package of up to 38 billion euros to deal with the coronavirus consequences
• Austria: Additional tax relief, in response to coronavirus (COVID-19)
• Austria: Tax relief measures regarding coronavirus (COVID-19)
• Covied-19 overview
• Austria: Additional tax relief, in response to coronavirus (COVID-19)
• Austria: Tax relief measures, update (COVID-19)

Tax: Christoph Plott – cplott@kpmg.at
Restructuring: Michael Nayer – mnayer@kpmg.at
Legal: Dieter Buchberger – dbuchberger@kpmg-law.at / Wendelin Ettmayer – wettmayer@kpmg-law.at