Taxation

Austria: VAT on real estate

DSC 9211 a

By Carina Langegger & Manfred Leitinger, Prodinger & Partner

Following the amendments made to the Austrian VAT Act in 2012, changes occurred for the worse with regards to VAT on rentals and to the input VAT adjustment period, in cases of change of property use.

VAT on rental of real estate

Renting agreements dated after 31 August 2012: the option right for VAT-liable renting can only be executed in cases where the lessee is entitled to an input VAT deduction of at least 95%. The execution of the option on VAT-liable taxation triggers the respective right for input VAT deduction. Medical centres or public buildings (schools, communal buildings, etc.) do not fulfil the 95% requirement and the lessor therefore has to consider that a deduction of input VAT is excluded.

Input VAT adjustment due to change of use

In cases where input VAT has been deducted at the moment of erection or acquisition of real estate, and where the respective real estate is not used for business purposes, an input VAT adjustment is compulsory. The input VAT adjustment period has been changed from 10 to 20 years and has been effective since 1 April 2012 (date differs from the one above). As a consequence, every new renting agreement extends the input VAT adjustment period to 20 years. Investors are facing considerable changes.

Both provisions provide extensive interim regulations and borderline problems. Contacting an expert for detailed advice is recommended.


Langegger Carina 121pxCarina Langegger
Prodinger & Partner St. Johann Steuerberatung GmbH & Co KG, St. Johann im Pongau, Austria
T: +43 6412 40 77
E: This email address is being protected from spambots. You need JavaScript enabled to view it.; W: www.prodinger.at

 

 

 

 

Leitinger Manfred 121pxManfred Leitinger
Prodinger & Partner St. Johann Steuerberatung GmbH & Co KG, St. Johann im Pongau, Austria
T: +43 6412 40 77
E: This email address is being protected from spambots. You need JavaScript enabled to view it.; W: www.prodinger.at

 

 

 

 

Mag. Carina Langegger LLM is an international tax law expert at the Prodinger Group. She has studied International Business and International Tax Law in Austria, Spain and the UK. During her work with a Big Four company in Germany, she gained extensive experience in international transactions and currently deals with all international issues within the group.

Mag. Manfred Leitinger is an expert who specialises in VAT consulting (consulting in cross-border business and foreign companies in Austria) and accounting. He has broken new ground in the field of accounting through the use of modern technology (i.e. scanning); he uses existing data in adjoining programmes and optimises operational procedures.

Prodinger & Partner St. Johann Steuerberatung GmbH & Co KG (Prodinger | GFB Wirtschaftsberatung) has been a leading partner for medium-sized companies for more than 50 years. It is an independent competence centre with a strong network offering a wide range of services for every kind of project, requirement and undertaking. The Prodinger Group has 10 offices in Austria. It provides extensive advice on Austrian tax issues.


published: July 2013

GGI Logo 70x50px

GGI Geneva Group
International AG

Schaffhauserstrasse 550
P.O. Box 286
8052 Zurich
Switzerland

Contact

T: +41 44 2561818
F: +41 44 2561811
This email address is being protected from spambots. You need JavaScript enabled to view it.
www.ggi.com