AUSTRIA Trends and Developments Contributed by: Raphael Holzinger, Matthias Jancura and Claudia Synek, Grant Thornton Austria
Tighter Rules for Real Estate Transactions Traditionally, Austria’s real estate transfer tax ( Grunder- werbsteuer ) applied mostly to direct property sales (asset deals). Owing to a stricter taxation policy from the newly elected government in 2025, the adaptation of the real estate transfer tax (RETT) was introduced on 1 July 2025. The new rules broaden the scope to include “share deals” – ie, the transfer of company shares in businesses that own real estate. This means that more real estate transactions – even indirect ones – can now be subject to taxation. Additionally, the relevant ownership threshold has been lowered from 95% to 75% to broaden the scope of applicability of the RETT. Once this threshold is met, 100% of the real estate values in the company’s assets are generally the basis for tax assessment. Against this backdrop, the following key changes to Austria’s RETT regime should be noted. • Indirect changes in ownership: shares moved with - in a chain of companies holding real estate are now covered by the newly adapted regulation to include more transactions in the scope of the RETT. • More companies are affected and the observation period is longer: the rules for changes in share - holders now also apply to corporations and part - nerships, and the Austrian tax authorities can look back over seven years instead of five. • Stock exchange trades are excluded: if shares of a real estate company are bought or sold on a stock exchange, these changes are not relevant for RETT. • Each property is checked separately: for tax pur - poses, whether the rules apply has to be analysed for each real estate. • Stricter rules for real estate companies: companies mainly focused on selling, renting or managing real estate will be more closely monitored in the future. If shares in these companies are transferred, a 3.5% tax can apply based on the full market value of the properties, unless the company is only owned by family members, in which case a lower tax rate may apply. • For company restructurings (especially within corporate groups), there is a key exception: if all parties involved belong to the same acquirer group, the transaction is not considered an indirect acquisition or consolidation of shares under RETT law.
Stricter Penalties and Enhanced Tax Audits With the Fraud Prevention Act 2025 ( Betrugsbekämp- fungsgesetz 2025 ), the federal government is taking a comprehensive reform step towards curbing tax and social fraud. The legislative package – which consists of tax-related, social security and data-based meas - ures – aims to promote greater tax fairness, more effi - cient controls and the long-term safeguarding of state revenues. Among other things, the amendment of the law brings about the following changes. The Fraud Prevention Act 2025 introduced a signifi - cant extension to Section 33 of the Criminal Fiscal Code (FinStrG), effective from 1 January 2026. Under the amended provision, the intentional reduction of tax liabilities, as well as the unjustified declaration of losses that could reduce taxable income in future periods, is punishable. This means that overstated or fictitious losses – previously not sanctionable in loss- making years – are now treated similarly to tax eva - sion, closing a long-criticised loophole. Additionally, Austrian tax authorities have intensified their scrutiny regarding transfer pricing arrangements. This increased vigilance is evident in stricter audits and more rigorous enforcement, reflecting a tougher financial criminal law landscape. Tax Increases Affecting Private Foundations in Austria The Austrian government has enacted new regula - tions that significantly impact private foundations, set to take effect from 1 January 2026. These changes are designed to align the taxation of foundations more closely with corporate standards and to address issues such as the accumulation of untaxed profits. The revised regulations introduce higher tax rates for both the foundation entrance tax and the interim taxa - tion of investment income. The measures are intended to ensure greater tax fairness and transparency within the sector. The following adaptations were introduced. • Foundation entrance tax increase: beginning 1 January 2026, the tax rate applied to contributions made by founders to Austrian private foundations will rise from 2.5% to 3.5%. This increase applies to assets or property transferred into a founda -
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