Austrian GmbH Tax Explained: 23% Corporate Tax, VAT and Deductions in 2025

Austria reduced its corporate tax rate from 25% to 23% in January 2024 — the lowest it has been since the Körperschaftsteuer was introduced. For founders running a GmbH, that one-percentage-point cut on top of the prior reduction (it was 25% from 2005 to 2022, then 24% in 2023) means the headline number is meaningfully better than it was a few years ago. The effective total tax load, however, still involves Umsatzsteuer at up to 20%, SVS social insurance contributions on Geschäftsführer salary, and a minimum tax that bites even in a loss-making year.

This guide explains the full picture: how Körperschaftsteuer is calculated, what VAT rates apply to what products and services, how to structure a director salary, which expenses are deductible, and how to file via FinanzOnline. Worked examples use EUR throughout.

For a plain-English summary of the headline rate, see our Austrian corporate tax rate guide and the Körperschaftsteuer glossary entry.

Körperschaftsteuer (KSt): the 23% rate

Körperschaftsteuer is Austria's corporate income tax. It applies to the worldwide profits of Austrian-resident companies — which includes any GmbH (Gesellschaft mit beschränkter Haftung) registered in Austria.

The rate has been on a downward trajectory:

The 2024 reduction was part of Austria's Ökosozialer Steuerreform (eco-social tax reform), which also raised the personal income tax threshold and increased the carbon levy. For founder-owned GmbHs, the relevant headline is simply that your company now pays 23% on taxable profit rather than 25%.

What counts as taxable profit?

Taxable profit (steuerlicher Gewinn) is broadly:

• Revenue from trading, services, and investments
• Less deductible operating expenses
• Less depreciation on fixed assets (Abschreibungen), at statutory rates
• Less Geschäftsführer salary and associated employer social charges
• Plus any non-deductible items added back (penalties, private use adjustments, etc.)

Austrian GmbHs must prepare accounts under the UGB (Unternehmensgesetzbuch) — Austria's commercial code — and tax profit starts from the UGB profit, with adjustments for specific tax rules.

Mindestkörperschaftsteuer: EUR 500 per year

Even if your GmbH makes a loss, Austria charges a Mindestkörperschaftsteuer (minimum corporate tax). The rate changed in 2024:

The reduction from EUR 1,750 to EUR 500 is significant for early-stage GmbHs that burn cash or break even. It was introduced alongside the main rate cut as part of the same 2024 reform package.

The minimum tax is a genuine minimum — not a prepayment. If your actual KSt liability for the year exceeds EUR 500, you pay actual KSt. If actual KSt is below EUR 500, you pay EUR 500. The minimum is paid in four quarterly instalments by 15 February, 15 May, 15 August, and 15 November.

You cannot offset the Mindestkörperschaftsteuer against future profitable years. It is a sunk cost.

Umsatzsteuer (USt): Austria's three VAT rates

Austria's Umsatzsteuer (the equivalent of VAT or GST) operates at three rates:

Detailed category breakdown

The 5% temporary rate introduced during the pandemic (for restaurants and certain cultural activities) ended on 31 December 2023. Hospitality food and drink returned to 10%, restaurant meals to 20%.

USt registration and filing

Austrian businesses must register for USt once annual turnover exceeds EUR 40,000 (see Kleinunternehmerregelung below). Once registered, you charge USt to customers, reclaim input USt on business purchases, and file returns either:

• Quarterly (Quartalsvoranmeldung) if turnover is below EUR 100,000
• Monthly (Monatsvoranmeldung) if turnover exceeds EUR 100,000

Filing is via FinanzOnline (Austria's tax portal). Annual USt returns are due by 30 June of the following year when filed electronically.

Geschäftsführer salary: the SVS question

A GmbH's managing director (Geschäftsführer) who also holds a significant shareholding (typically over 25%) is treated differently from an arm's-length employee. You are not subject to the standard ASVG social insurance system — instead you pay contributions to the SVS (Sozialversicherung der Selbständigen), the self-employed social insurance fund.

SVS contribution rates (2025)

SVS contributions are calculated on the Geschäftsführer's income from the GmbH — meaning the salary paid by the company. The minimum contribution base (Mindestbeitragsgrundlage) in 2025 is approximately EUR 6,221/year, so there is a floor to what you pay even on a low salary.

SVS contributions paid by the GmbH (i.e., the employer's share, where applicable) are a deductible business expense. The Geschäftsführer's personal SVS contribution is deductible against their own personal income tax bill.

Optimal salary structuring

Because GmbH profits are taxed at 23% KSt and dividends paid to shareholders face a further 27.5% Kapitalertragsteuer (KESt), the total tax drag on profits extracted as dividends is:

• 23% KSt on profit
• 27.5% KESt on the remaining 77% = approximately 21.2%
• Combined rate: approximately 44.2%

A Geschäftsführer salary, by contrast, is:

• Fully deductible as a GmbH expense (reduces KSt base)
• Subject to Lohnsteuer (income tax) at personal rates, plus SVS

Austrian personal income tax rates in 2025:

For most founder-directors, a salary up to approximately EUR 60,000–80,000 is more tax-efficient than extracting profits as dividends. Above that, the 48% personal rate starts competing with the 44.2% combined KSt+KESt rate, and a mix of salary and dividends tends to be optimal.

A tax adviser (Steuerberater) should model the exact split for your situation — this is a calculation with real money at stake and the optimal point shifts depending on your total income, SVS minimum bases, and any other income sources.

Kleinunternehmerregelung: the EUR 40,000 threshold

Small businesses with annual turnover under EUR 40,000 (net, i.e., before USt) can opt for the Kleinunternehmerregelung — a simplified VAT exemption. Under this regime:

• You do not charge USt to customers
• You cannot reclaim input USt on your purchases
• No USt returns required
• You invoice without VAT, with the note "Kein Umsatzsteuer gemäß § 6 Abs. 1 Z 27 UStG"

The threshold increased to EUR 40,000 from EUR 35,000 in 2024. From 1 January 2025, there is also an EU-wide cross-border Kleinunternehmer scheme: Austrian small businesses with total EU revenue under EUR 100,000 and per-country revenue under each member state's local threshold can supply goods and services to other EU countries without local VAT registration.

For GmbHs with B2B customers, the Kleinunternehmerregelung is usually not attractive even if you are eligible — B2B customers can reclaim input VAT anyway, and being unable to reclaim your own input VAT on purchases costs you more than you save. It suits very small B2C businesses, sole traders, and freelancers more than a trading GmbH.

Deductible expenses for an Austrian GmbH

The following costs are deductible against the GmbH's taxable profit, reducing the KSt base:

Personnel costs

• Geschäftsführer salary (subject to it being at arm's length and documented in a formal service agreement)
• Employer-side social insurance contributions (ASVG for employees, SVS contributions where the GmbH is the employer)
• Lohnnebenkosten (ancillary wage costs): Dienstgeberbeitrag (DB) at 3.9%, Zuschlag zum Dienstgeberbeitrag (DZ) at ~0.38%, and Kommunalsteuer at 3%

Fixed asset depreciation (Abschreibung/AfA)

Austria uses straight-line depreciation at statutory rates:

• Buildings: 2–3% per year (40–50 year life)
• Office equipment, computers: typically 25–33% (3–4 year life)
• Vehicles: 12.5% per year (8 year life) for standard cars; note that luxury vehicles have acquisition cost capped at EUR 40,000 for tax purposes
• Intangible assets: amortised over useful life or 15 years if indefinite

Office and premises

• Rent, rates, utilities, cleaning for business premises
• Home office deduction (Arbeitszimmer): deductible where the office is the primary and central place of business — the "home office" room must be used almost exclusively for business

Travel and vehicles

• Business travel costs: accommodation, flights, rail tickets at actual cost
• Meal allowances (Tagesgeld/Diäten): statutory daily rates for travel over certain distances (EUR 26.40/day for full-day Austria travel in 2025)
• Vehicle costs: if the GmbH owns a car, the benefit-in-kind rules apply for private use. Fuel, insurance, and maintenance deductible to the extent of business use

Professional services

• Steuerberater (accountant/tax adviser) fees — fully deductible
• Rechtsanwalt (lawyer) fees for business matters
• Audit fees
• Software subscriptions (accounting software, project management, cloud tools) — deductible in full in the year of cost for subscriptions; perpetual licences depreciated

Insurance

• Business liability insurance (Betriebshaftpflicht)
• D&O (directors and officers) insurance
• Property and contents insurance for business assets

Marketing and advertising

• Advertising spend (online, print, events)
• Website development costs — typically depreciated over 3–4 years for custom builds; SaaS tools deducted as incurred
• Trade show attendance and related travel

Non-deductible items (watch these)

• Fines and penalties — not deductible
• 50% of client entertainment costs (Bewirtungsaufwand) — only half is deductible
• Domestic passenger car acquisition above EUR 40,000 — the excess is a non-deductible "luxury" addition
• Capital gains tax (KESt) paid by the GmbH on investment income — accounted separately
• Shareholder loan interest above arm's-length rates

Gründungsprivileg: reduced capital for new GmbHs

A standard Austrian GmbH requires minimum share capital of EUR 35,000, of which at least EUR 17,500 must be paid in at incorporation. For most founders, tying up EUR 17,500 on day one is a significant constraint.

The Gründungsprivileg (founding privilege), introduced in 2014, allows a new GmbH to operate with a reduced paid-in capital of just EUR 10,000 for the first ten years. During this period:

• The registered Stammkapital remains EUR 35,000 (this is a legal minimum on paper)
• Only EUR 10,000 needs to be actually paid in and available as working capital
• The GmbH is marked in the register as operating under the Gründungsprivileg
• The reduced minimum must be fully paid up in cash (not in kind)

After ten years, the company must either top up capital to EUR 17,500 (the normal half-paid minimum) or take a different legal form. In practice, most successful GmbHs build up retained earnings that far exceed this — the ten-year cap rarely matters.

The Gründungsprivileg makes the GmbH a realistic option for early-stage founders who previously used an Einzelunternehmen (sole tradership) or OG (general partnership) to avoid the capital requirement.

Investitionsprämie and business grants

Austria operates a range of investment grants and incentives. The most relevant for founder-owned GmbHs:

Investitionsprämie (investment premium)

Austria ran a significant Investitionsprämie programme in 2020–2021 (14% for green/digital investments, 7% for others) in response to COVID. That programme is closed. The ongoing investment deduction framework is the Investitionsfreibetrag (IFB), reintroduced from 2023:

• 10% of the acquisition cost of qualifying new investments can be deducted as an additional expense
• Qualifying investments: tangible moveable assets with a useful life of at least four years, not vehicles, not second-hand equipment
• For green/ecological investments (defined in a separate regulation), the IFB is 15%
• Maximum investment base: EUR 1,000,000/year, so maximum deduction EUR 100,000 (standard) or EUR 150,000 (green)

The IFB is in addition to normal depreciation — you get the IFB deduction in year one plus the regular AfA in all years of useful life.

AWS (Austria Wirtschaftsservice) grants

AWS is Austria's national development bank. Its grant and loan programmes include:

• AWS Gründerfonds: equity financing for high-growth startups
• AWS Garantien: loan guarantees for SMEs that cannot secure conventional bank lending
• ERP-Kredite: low-interest loans for investment in machinery, equipment, and digitalisation

Applications are made directly through AWS. Accountants familiar with the Austrian SME landscape can advise on eligibility and the application process.

aws Unternehmensgründungsberatung

A EUR 200 voucher (Beratungsscheck) is available for new businesses to offset costs of professional advice from qualified consultants. Small but useful for first-year founders.

Worked example: GmbH with EUR 200,000 profit

Let's run through a realistic tax calculation for a technology consulting GmbH in Vienna. The Geschäftsführer pays herself a salary of EUR 80,000 (including employer costs) from the GmbH before calculating profit.

Starting position

Corporate tax calculation

Dividend distribution

If the founder distributes the remaining EUR 154,000 as a dividend:

Total tax on the EUR 200,000 profit

The EUR 80,000 salary was already deducted as a cost — the Geschäftsführer pays Lohnsteuer and SVS on that separately at personal rates.

Comparison: retaining profit vs distributing

If the founder retains the EUR 154,000 in the GmbH (reinvests, builds reserves, or keeps as working capital), she only pays the EUR 46,000 KSt at the company level. The KESt is deferred until she actually extracts money. Retained profit can be used to fund future investment, reduce the need for external borrowing, and compound inside the lower 23% tax environment.

Filing via FinanzOnline

All Austrian tax filings are handled through FinanzOnline (www.finanzonline.at), the Austrian tax authority's (Finanzamt) online portal. A GmbH typically appoints a registered Steuerberater (tax adviser) to handle filings on its behalf.

Key filing deadlines:

The annual accounts (Jahresabschluss) must be filed with the company register (Firmenbuch) within nine months of the financial year-end. For a December year-end, that is 30 September. Late filing attracts automatic fines starting at EUR 700.

FinanzOnline access for GmbHs

To file via FinanzOnline, the GmbH needs a Finanzamt registration number (Steuernummer). This is assigned automatically when the company registers for tax, which happens at the same time as GmbH registration (or shortly after). The Steuernummer is different from the UID-Nummer (VAT identification number, beginning "ATU").

A Steuerberater can be granted full access to FinanzOnline on behalf of the GmbH. They will handle the actual filing; you simply review and approve. For founders handling their own accounts, direct FinanzOnline access is available with a mobile phone-verified login.

Austrian GmbH tax at a glance

Common mistakes Austrian GmbH founders make

Not paying a Geschäftsführer salary

Some founders leave all profit in the company and take dividends. This avoids SVS contributions but faces the full 44.2% combined KSt+KESt rate on extracted money. A salary up to around EUR 60,000–80,000 is typically more efficient because it reduces the KSt base at 23% while being taxed at lower personal rates.

Ignoring the Mindestkörperschaftsteuer in a loss year

EUR 500 is small, but if you forget to budget for the quarterly EUR 125 payments during a startup phase, you accumulate unpaid tax and attract interest charges.

Missing Kommunalsteuer

Kommunalsteuer (local payroll tax at 3% of gross wages) is paid to the municipality where the business operates, not to the national Finanzamt. It is easy to miss in early setup. It is deductible as a business expense.

Treating private expenses as deductible

The Finanzamt is alert to mixed-use assets — cars, meals, computers, and phones used partly privately. Any private use element must be excluded from the deduction or a benefit-in-kind adjustment made. The cost of getting this wrong is not just the deduction reversal but surcharges and interest.

Underpaying Geschäftsführer salary below market rates

If a Geschäftsführer salary is set artificially low to reduce SVS, the Finanzamt can assert that the arrangement does not reflect an arm's-length transaction and adjust accordingly. Conversely, an above-market salary is also scrutinised. Document the basis for the salary level in the service agreement.

How Finn handles Austrian accounting

Finn, AccountsOS's AI accountant, supports Austrian GmbHs natively. You can ask Finn in plain English (or German):

• "What's my KSt liability for this year based on current transactions?"
• "Which of these expenses are deductible?"
• "When is my next Voranmeldung due?"
• "Am I still under the Kleinunternehmer threshold?"

AccountsOS tracks your transactions, flags uncategorised items for review, calculates your taxable profit in real time, and reminds you of upcoming filing deadlines — the quarterly KSt prepayments, the USt returns, the annual accounts deadline.

There is no spreadsheet to maintain, no manual reconciliation, and no waiting until January to discover what you owe. Finn keeps the books as the year happens.

Explore AccountsOS for Austria or start a conversation with Finn today.

This article reflects Austrian tax law as of June 2026. Tax rules change — particularly the Investitionsfreibetrag thresholds and USt category assignments, which are subject to annual adjustment. Consult a registered Steuerberater (tax adviser) for advice specific to your GmbH's situation.