The value-added tax (VAT) rate in Austria affects pricing, invoicing, and compliance for businesses selling goods or services into the country, including foreign and cross-border sellers. When dealing with all of the components of the Austrian VAT rates, small mistakes can multiply.

Below, we explain how Austrian VAT works, including registration rules, compliance requirements, and refund processes step by step.

What’s in this article?

• What is the Austria VAT rate?
  
• What are the different VAT rates for goods and services in Austria?
  
• Who needs to register for VAT in Austria?
  
• What is an Austrian VAT number, and when is it required?
  
• How does VAT registration work for foreign businesses in Austria?
  
• How does VAT compliance work in Austria?
  
• How often do businesses need to file VAT returns in Austria?
  
• How do VAT refunds work in Austria?
  
• How Stripe Tax can help
  

What is the Austria VAT rate?

The standard VAT rate in Austria is 20%. This rate applies by default to most goods and services. If no reduced rate or exemption clearly applies, businesses should use the 20% rate.

What are the different VAT rates for goods and services in Austria?

Along with its standard VAT rate, Austria has several reduced VAT rate categories that depend on the nature of the product or service.

Here are the categories:

• 20% standard rate: This applies to most goods and services, including consumer products, electronics, professional services, and most digital and online sales.

• 13% reduced rate: This applies primarily to culture and certain agricultural activities, including admission to sporting events and the delivery of living plants and animals.

• 10% reduced rate: This covers essential goods and services, including food and nonalcoholic beverages, books and newspapers (both physical and digital), many medicines, passenger transport, and qualifying residential rents.

• 0% rate (zero-rated supplies): These supplies are taxable, but charged at 0%. Examples include exports, many intra-EU business-to-business (B2B) supplies, international transport services, and certain essential items such as feminine hygiene products and specific contraceptives.

Reduced VAT rates in Austria apply automatically when a good or service falls within a legally defined category. The Austrian VAT Act clearly lists which goods and services qualify for the 10% and 13% rates, and businesses must apply those rules exactly. If a product or service is incorrectly treated as reduced-rate, the business remains liable for the underpaid VAT, along with potential penalties or interest. Eligibility for reduced rates is reviewed periodically, so businesses need to stay up to date to remain compliant.

Who needs to register for VAT in Austria?

VAT registration requirements in Austria depend on where a business is established. It also depends on how it carries out taxable activity.

Here’s who needs to register for VAT in Austria:

• Austrian-established businesses: Businesses based in Austria must register for VAT once their annual taxable turnover exceeds €55,000. Austrian-based businesses under the €55,000 threshold can remain unregistered, but might choose to register voluntarily to reclaim input VAT.

• Foreign businesses with taxable activity in Austria: Non-Austrian businesses generally have no VAT registration threshold and must register from their first taxable transaction in Austria, unless a specific exception applies. EU business-to-customer (B2C) businesses can follow the EU-wide €10,000 threshold for distance sales of goods and use the One Stop Shop (OSS) once they surpass it.

• Businesses holding inventory or importing goods: Businesses that store goods in Austria, import goods as the importer of record, or sell from Austrian warehouses typically must register immediately.

• Event organizers and location-based service providers: A business selling event admission or providing services tied to a physical location in Austria often must register for VAT, even if the business is established elsewhere.

Foreign companies supplying qualifying services to Austrian VAT-registered businesses via cross-border business might not need to register if the reverse-charge mechanism applies.

What is an Austrian VAT number, and when is it required?

An Austrian VAT number identifies a business within Austria’s VAT system and is required once VAT registration becomes mandatory. It’s used on invoices, VAT returns, and official correspondence with the tax authority.

Here’s what you need to know:

• It has a standard format: Austrian VAT numbers begin with “ATU” followed by eight digits.

• It’s required in order to charge and report VAT: The VAT number must appear on invoices and be used for VAT returns, payments, and correspondence with the tax authority.

• It’s vital for correct cross-border transactions: VAT numbers allow EU B2B transaction validation and ensure correct treatment under reverse-charge or zero-rating rules.

• There’s one number per business: A single Austrian VAT number covers all taxable activity carried out by the business in Austria.

How does VAT registration work for foreign businesses in Austria?

If you run a foreign business, you must take a few extra steps before charging VAT in Austria. You will need to register for VAT and apply directly with the Austrian tax authorities. Nonresident registrations are processed by a designated Austrian tax authority, usually through Austria’s FinanzOnline portal or via official registration forms. Applicants must submit company registration documents, proof of business activity, identification for directors or owners, and details of expected Austrian transactions.

VAT numbers are usually issued within two to four weeks once a complete application is submitted, though complex cases might take longer. Companies based outside of the EU often need to appoint a fiscal representative in Austria who shares responsibility for VAT compliance. VAT obligations begin from the date that taxable activity starts in Austria, even if the VAT number hasn’t been issued yet.

How does VAT compliance work in Austria?

Once you’re registered for VAT in Austria, compliance becomes an ongoing responsibility. There are a few aspects to consider when you make this commitment.

Keep the following in mind:

• Correct VAT must be charged on every sale: Businesses must apply the correct VAT rate and clearly show VAT on invoices and receipts.

• Invoices must meet legal requirements: Austrian VAT invoices must include mandatory details, including the supplier’s VAT number, transaction date, net amount, VAT rate, and VAT amount.

• Electronic filing is mandatory: VAT returns and payments are submitted through FinanzOnline system, Austria’s central tax platform.

• VAT is paid or reclaimed on a per-return basis: If output VAT exceeds input VAT, the business pays the difference. If input VAT exceeds output VAT, the excess can be carried forward or refunded to the business.

• There’s additional reporting for cross-border activity: Intra-EU B2B sales often require EC Sales Lists, and goods movements can trigger Intrastat reporting once thresholds are exceeded.

• Record-keeping obligations apply: VAT records must generally be kept for at least seven years, with longer periods for certain transactions such as real estate.

• Penalties apply for errors and delays: Late filings or incorrect reporting can result in interest, surcharges, or fines.

How often do businesses need to file VAT returns in Austria?

How frequently you file VAT returns in Austria depends mainly on your turnover. It’s likely that if you run a larger business, you will need to report more often than if you run a smaller one.

Here are common reporting times:

• Monthly filing for larger businesses: Businesses with annual turnover above €100,000 generally file VAT returns every month.

• Quarterly filing for small businesses: Businesses with turnover at or below €100,000 can file quarterly.

• Annual VAT returns: All VAT-registered businesses must submit an annual return that reconciles the full year.

Deadlines are strict: periodic returns and payments are due by the 15th of the second month following the reporting period. Annual returns are typically due by the end of June of the following year. Late filing can lead to penalties even if the business doesn’t owe VAT.

How do VAT refunds work in Austria?

VAT refunds in Austria are designed to ensure businesses don’t carry VAT costs that aren’t permanent. Registered businesses should expect to reclaim excess input VAT via their regular VAT returns.

Here’s how they work:

• Refunds are requested electronically: A business submits refund claims through the FinanzOnline system, and once approved, the refund is paid directly to the business’s registered bank account.

• EU businesses can reclaim VAT without registering: EU-based businesses can reclaim Austrian VAT through the EU VAT refund system without registering locally.

• Non-EU businesses use a separate refund process: Businesses outside the EU must apply directly to the Austrian tax authority under the non-EU refund scheme.

• Not all VAT is refundable: Only VAT on recoverable expenses qualifies, and incomplete documentation can delay or prevent repayment.

How Stripe Tax can help

Stripe Tax reduces the complexity of tax compliance so you can focus on growing your business. Stripe Tax helps you monitor your obligations and alerts you when you exceed a sales tax registration threshold based on your Stripe transactions. In addition, it automatically calculates and collects sales tax, VAT, and GST on both physical and digital goods and services—in all US states and in more than 100 countries.

Start collecting taxes globally by adding a single line of code to your existing integration, clicking a button in the Dashboard, or using our powerful API.

Stripe Tax can help you:

• Understand where to register and collect taxes: See where you need to collect taxes based on your Stripe transactions. After you register, switch on tax collection in a new state or country in seconds. You can start collecting taxes by adding one line of code to your existing Stripe integration or add tax collection with the click of a button in the Stripe Dashboard.

• Register to pay tax: Let Stripe manage your global tax registrations and benefit from a simplified process that prefills application details—saving you time and simplifying compliance with local regulations.

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