AUSTRIA Law and Practice Contributed by: Clemens Philipp Schindler and Mohamed Hemdan, Schindler Attorneys
es involving negligent conduct as well as intentional offences where the amount of evaded tax does not exceed EUR150,000. By contrast, the ordinary courts have jurisdiction over intentional offences where the evaded tax exceeds EUR150,000 and over certain aggravated offences, such as cases involving cross- border VAT fraud. Depending on the circumstances, a case may be transferred from the tax authorities to the courts or vice versa, which may occur, for example, where additional offences come to light or where the initially assumed threshold for court jurisdiction is subse - quently not met. Tax evasion is punishable by a monetary fine of up to 200% of the tax amount evaded (or unjustified tax credits). In cases of wrongfully declared losses, the relevant amount of tax evaded corresponds to the tax that would result from applying the applicable tax rate to the absolute amount of the improperly declared loss. For example, if a taxpayer incurs a legitimate loss of EUR20,000 and increases this loss to a total of EUR60,000 by unlawfully claiming additional expens - es, the absolute amount of EUR40,000 is considered the “relevant value”, to which the applicable tax rate is then applied. In addition to the fine, a prison sentence of up to four years may be imposed. The primary sanction for tax fraud – as a qualified form of tax evasion – is imprisonment, which, depending on the defrauded value, may be up to five or ten years. A monetary fine may also be imposed; however, the maximum amount is limited by statutory provisions (up to EUR1.5 million or EUR2.5 million, and in the case of corporate fines up to EUR5 million or EUR8 million). 6.3 Interaction Between Tax and Criminal Procedures In practice, every tax audit report may also be reviewed by a competent fiscal criminal officer from the perspective of fiscal criminal law. As a result, tax audits may lead to the initiation of fiscal criminal pro - ceedings where indications of a fiscal offence are identified. Fiscal criminal proceedings may also be initiated where suspicious activities are reported to
the authorities and preliminary investigations establish sufficient grounds for suspicion. As described previously, a distinction must be made between administrative fiscal criminal proceedings and judicial fiscal criminal proceedings. While admin - istrative fiscal criminal proceedings are conducted by the tax authorities acting as fiscal criminal authorities, judicial fiscal criminal proceedings are governed by the principles of ordinary criminal procedure, supple - mented by specific provisions of the Austrian Fiscal Criminal Act. In judicial fiscal criminal proceedings, the public prosecutor is the competent authority responsible for directing the investigation and prosecution. In such cases, the fiscal criminal authorities act as investiga - tive bodies on behalf of the public prosecutor. In par - ticular, the tax investigation unit within the Anti-Fraud Office conducts fiscal criminal investigations either on behalf of the public prosecutor’s office or jointly with the criminal matters division, in accordance with the Austrian Fiscal Criminal Act and the ordinary criminal procedure rules. 7. Administrative Co-Operation 7.1 Legal Framework for Administrative Co- Operation Austria is among the jurisdictions that have agreed to implement the OECD/G20 standard for the automatic exchange of information. Under this framework, par - ticipating jurisdictions exchange tax-relevant informa - tion annually, with the first exchanges having taken place in 2017. The legal basis for this is the Multilat - eral Convention on Mutual Administrative Assistance in Tax Matters. At the EU level, administrative co-operation is primar - ily based on the EU Directive on Administrative Coop - eration (DAC) and its subsequent amendments. In addition, Austria generally follows the OECD Model Tax Convention in its network of DTTs, which include provisions corresponding to Article 26 of the OECD Model Tax Convention regarding the exchange of information between the competent authorities.
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