Municipal tax

Who has to pay municipal tax in Austria?

The municipal tax is an exclusively local levy. Enterprises that pay wages to employees at a permanent business establishment located in Austria are subject to municipal tax in any municipality in which the company has a permanent business establishment.

Enterprises within the meaning of the Kommunalsteuergesetz are those who independently carry out commercial or professional activity. Public bodies are only commercially or professionally active in the context of their commercial operations and their agricultural and forestry operations.

The following are exempt from municipal tax:

• The Austrian Federal Railways and private railways with 66 per cent of the tax base
• Corporations, associations of persons or assets, provided that they are run for charitable and/or not for profit purposes in the healthcare sector, or for the benefit of children, young people, families, the sick, the disabled, the blind or the elderly.
  In order to qualify for an exemption, an organisation must cumulatively take the form of one of the named legal entities (i.e. not an individual person), be run for the aforementioned purposes according to its legal basis and management, for the benefit of at least one of the welfare areas featured on the exhaustive list.

How is the municipal tax calculated?

The municipal tax amounts to 3 percent of the tax base. The tax base is the total wages paid to the employees of a permanent business establishment of the enterprise in a calendar month. Only those permanent business establishments that are located in an Austrian municipality are relevant.

How do I pay municipal tax?

For the payment of municipal tax, the company requires a tax account in the respective municipality(ies). The opening of the tax account must be requested in writing. Some municipalities also offer an online form for this purpose. As soon as the tax account has been set up, the company receives a letter with the tax account number.

The entrepreneur must calculate the municipal tax for each calendar month themselves and pay the entitled municipality by the 15th day of the following month. At the end of the calendar year, the municipal tax return must be sent via FinanzOnline, by 31 March of the following year at the latest. If you have an internet connection, the municipal tax declaration must be sent electronically via FinanzOnline.

Additional information

• FinanzOnline (→ BMF)^{German text}
• Municipal Tax (→ City of Vienna)^{German text}
• Employer Tax (→ City of Vienna)^{German text}