What is Umsatzsteuer / USt (Austrian VAT)?

Umsatzsteuer is Austria's implementation of the EU VAT Directive. The three-tier rate structure is one of Austria's distinguishing features versus many EU neighbours who use only two rates.\n\n**The three rates in detail**\nThe 20% standard rate applies to most goods and services not specifically listed for reduced rates. The 10% reduced rate covers food and non-alcoholic beverages, books and newspapers, pharmaceuticals, passenger transport (trains, buses, flights within Austria), residential rent, and admission to cultural/educational events. The 13% intermediate rate was introduced in 2016 and covers hotel accommodation, campsites, firewood, cultural events run by non-profit organisations, and wine sold at the producer's premises (Buschenschank). This three-tier structure creates complexity in practice — a hotel serving breakfast must apply 13% to accommodation and 10% to the food component.\n\n**Kleinunternehmer threshold**\nBusinesses with annual turnover below €35,000 (net of USt) qualify as Kleinunternehmer and are exempt from charging USt. As of 2025, this threshold aligns with the EU SME VAT exemption harmonisation rules. Kleinunternehmer cannot reclaim input VAT (Vorsteuer). They can voluntarily opt into USt registration at any time, which is often advantageous when purchasing significant capital equipment or when B2B clients require VAT invoices. The option to opt in binds for five years.\n\n**Registration and FinanzOnline**\nBusinesses expecting to exceed the threshold must register for USt with the Finanzamt. All filing is done electronically via FinanzOnline (the Austrian equivalent of ELSTER). Non-Austrian EU businesses supplying digital services to Austrian consumers must register for OSS (One Stop Shop) under the EU VAT rules.\n\n**Voranmeldungen**\nUSt Voranmeldungen (advance returns) are due monthly or quarterly depending on prior year liability. Monthly returns are due by the 15th of the second month following the period (so January returns are due 15 March). Quarterly returns apply for businesses with annual liability below €100,000. The annual USt return consolidates the Voranmeldungen.\n\n**Reverse charge (Übergang der Steuerschuld)**\nFor B2B services from EU businesses and certain domestic construction/security services, the Austrian reverse charge mechanism applies under §19 UStG. The recipient self-assesses USt and simultaneously reclaims it as Vorsteuer — net-neutral for VAT-registered recipients.