What Taxes Do Filipino Expats Pay in Austria?

Moving to Austria feels like stepping into a postcard—think Vienna’s vibrant cafes, the majestic Alps, and a culture that blends history with modern charm. Whether you’re an expat working in Salzburg, an international student in Graz, or sending money home with ACE Money Transfer, understanding Austria’s tax system is key to managing your finances. Taxes can seem daunting, but they don’t have to be. This guide breaks down what you need to know about taxes as an expat in Austria, so you can plan smart and keep more money for what matters, like supporting loved ones back home.

Income Tax for Expats: What You Need to Pay

Austria’s tax system is straightforward once you get the hang of it, but it’s got layers. As an expat, your income tax depends on whether you’re a resident or a non-resident. Residents are taxed on worldwide income, while non-residents only pay on Austria-sourced income. Let’s unpack the main things you’ll encounter when it comes to income tax, so you’re not caught off guard.

Progressive Income Tax Rates

Austria uses a progressive tax system, meaning the more you earn, the higher your tax rate. If you’re employed, your employer deducts income tax (called Lohnsteuer) directly from your paycheck, so you don’t have to worry about monthly filings. This pay-as-you-earn system keeps things simple, especially for expats new to Austria. For example, if you’re sending money home via ACE Money Transfer, you’ll know exactly how much is left after taxes.

Visit the Austrian Federal Ministry of Finance for the latest tax brackets.

Taxable Income Sources

As an expat, you’ll need to know what counts as taxable income. Austria casts a wide net, so here’s what’s included:

• Employment income: Your salary, bonuses, and any cash perks.
• Self-employment income: If you’re a freelancer or run a business, you’re taxed on profits after deductions.
• Capital gains: Selling stocks or real estate? Profits are taxed for most investments.
• Benefits in kind: If your employer provides a company car for personal use or covers your rent, these are taxable based on their market value.

For instance, if your job in Vienna comes with a fancy company apartment, expect that perk to add to your taxable income. Non-residents only worry about income earned in Austria, like wages from an Austrian employer. Knowing what’s taxable helps you budget for transfers to family abroad using services like ACE Money Transfer, which boasts a 4.8 out of 5 rating on Trustpilot with over 129,000 reviews. 

Filing Requirements

Do you need to file a tax return? It depends. If you’re an employee with a single income source and your employer deducts Lohnsteuer, you’re usually off the hook. But you might need to file a return (called Einkommensteuererklärung) in these cases:

• You have multiple income sources (e.g., a side hustle or rental income).
• You want to claim deductions for expenses like commuting or work tools.
• You’re self-employed, earning over €11,693 annually.
• You’re a non-resident with Austrian income and need to report it.

Tax Deductions and Benefits for Expats

Here’s the good news: Austria offers plenty of deductions and benefits to lighten your tax load. For Filipino expats, saving on taxes can mean more money to send home. Learn how ACE’s remittance policies ensure low fees and secure transfers to the Philippines.

Lump-Sum Expense Dedication

If you’re an expat who hasn’t lived in Austria for the past 10 years and works for an Austrian employer (or a foreign company with an Austrian branch), you might qualify for a lump-sum expense deduction. This is a deduction on your gross salary to cover costs like:

• Maintaining a second home abroad for your family.
• Trips back to your home country to visit loved ones.
• Other expenses tied to living in Austria temporarily.

The best part? You don’t need receipts. Your employer can apply this deduction directly to your payroll, or you can claim it on your tax return. This extra cash can be used to send money to Philippines from Austria via ACE Money Transfer’s secure, low-fee platform.

Work-Related Deductions

Austria loves rewarding hard work with deductions. You can reduce your taxable income by claiming expenses tied to your job. Some common ones include:

• Commuting costs: A standard deduction based on distance.
• Work tools: Laptops, software, or uniforms needed for your job.
• Language courses: German lessons to help you settle in are often deductible.
• Professional memberships: Fees for groups like the Chamber of Labour.

Researchers and scientists get extra love. Learn more about researcher tax benefits from the Austrian Business Agency. These savings mean more money for remittances or enjoying Austria’s Christmas markets.

Tax-Free Benefits

Some employer perks are tax-free, which is a win for your wallet. These include:

• Relocation reimbursements: Up to a limit, costs for moving to Austria are tax-exempt.
• Small non-cash gifts: Think Christmas presents worth up to €186 per year.
• Company events: Team outings up to €365 per employee annually.
• Certain insurance premiums: Employer-paid premiums can be tax-free under specific conditions.

For example, if your employer covers your move to Innsbruck, that reimbursement won’t bump up your taxes. Pair these benefits with ACE Money Transfer’s secure platform, and you can send more to your family without hidden costs.

Smarter Tax Planning in Austria

Navigating Austria’s tax system as an expat doesn’t have to be stressful. Your residency status determines whether you’re taxed on worldwide or Austrian income, with progressive rates from 0% to 55%. Social security contributions (around 18% for employees) are a big chunk, but deductions like lump-sum expenses, commuting costs, and researcher benefits can lower your tax bill. Double taxation agreements with countries like the Philippines ensure you’re not taxed twice, leaving more for remittances. 

Share the guide with fellow expats and explore ACE’s services today!

FAQs

What happens if I miss the tax filing deadline?

Late filings may lead to penalties or a standard assessment, and missing out on deductions. Extensions are possible via accountants.

Can expats deduct childcare costs in Austria?

Yes, childcare costs are deductible if work-related, with limits based on the child’s age and expense type.

How are stock options taxed for expats?

Stock options are taxed as income when exercised, at progressive rates, unless part of tax-free schemes.

Do expats need a tax ID in Austria?

Yes, a tax ID is issued upon registering with the tax office, required for employment and tax filings.

Can expats claim tax relief for home office expenses?

Yes, home office expenses (e.g., furniture, internet) are deductible if work-related, especially post-2020 regulations.