Austria is Germany with mountains and a top tax rate of 55 percent. In return there is no inheritance tax, no wealth tax, a thirteenth and fourteenth salary taxed at 6 percent and, in Vienna, subsidised rents that shape the market.
The short answer
Hardly cheaper than Germany, often better net for employees thanks to the extra salaries, attractive for the wealthy thanks to no inheritance tax.
milinia’s take
- Holiday and Christmas pay are taxed at only 6 percent, which lifts annual net noticeably.
- No inheritance or gift tax since 2008, only transfer tax on property transfers.
- Capital gains 27.5 percent, savings interest 25 percent, price gains taxable since 2011.
- Property purchase: 3.5 percent transfer tax, 1.1 percent registration, agent 3 percent plus VAT, notary around 1 to 2 percent.
Living and costs
Price level like Germany, Vienna somewhat cheaper than Munich for rents because over 60 percent of Viennese live in subsidised or municipal housing. A one-bedroom flat on the open market costs around €1,050 in the centre, in Graz €750, in Innsbruck and Salzburg €950 to €1,100. Groceries slightly dearer, restaurants similar, energy similar. Wages sit slightly below Germany, with 14 salaries.
Taxes
Income tax starts at 20 percent from €13,500 and ends at 55 percent from one million, 50 percent from around €100,000. The thirteenth and fourteenth salary are taxed at 6 percent, which lowers the effective rate for employees noticeably. Capital gains from shares, funds and dividends 27.5 percent, savings interest 25 percent, gains on gold tax-free after one year while crypto has been 27.5 percent always since 2022. No wealth tax, no inheritance tax, no gift tax; gifts above €50,000 are only reportable. Social insurance at around 18 percent employee share up to a ceiling of around €6,500 a month.
Property
Vienna €6,500 per square metre on average, the inner city over €12,000, Salzburg €6,800, Innsbruck €7,000, Graz €4,200, Linz €4,500, rural areas €2,500 to €4,000. Closing costs around 10 percent: transfer tax 3.5 percent, land registry 1.1, agent 3 percent plus 20 percent VAT, notary or lawyer 1 to 2 percent. Loans have followed strict rules since 2022: 20 percent equity, payment at most 40 percent of net, term at most 35 years. Rental yields 2.5 to 3.5 percent, old-building rents capped by the reference value law. Sale: property gains tax 30 percent on the gain, no speculation period, exception for a main residence after two or five years.
Gold, portfolio, bank
Investment gold VAT-free; the Austrian Mint strikes the Philharmonic, dealers in every city. Gains on gold tax-free after one year. Austrian banks are tax-simple: the KESt is remitted automatically. German brokers are not tax-simple; income must be declared.
What emigrants underestimate
The top rate from €100,000, the standard consumption tax on cars that makes a vehicle 10 to 30 percent dearer, and the property gains tax without a ten-year period. In return, succession without tax is an argument the wealthy appreciate.
Try it yourself
Travel Budget CalculatorCountry, days, people, style: your daily budget and travel fund, with buffer and cash share.Income Tax CalculatorEnter taxable income, read off tax, marginal rate and average rate, with joint assessment.Frequently asked questions
Is the German pension taxed in Austria?
No, statutory pensions remain taxable in Germany under the treaty; Austria only counts them for the rate.
Is there transfer tax on gifts to children?
Yes, staggered on the property value: 0.5 percent up to €250,000, 2 percent up to €400,000, above that 3.5 percent. That replaces the missing gift tax.
Are ETF gains taxable?
Yes, 27.5 percent regardless of holding period, with annual taxation of deemed distributions for accumulating funds.
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