English Summary 3/2025

The draft of the new Research Premium Guidelines 2025 provides clarification in all areas of the research premium. This article summarizes the most important regulations on the assessment basis and procedural rules in a compact form and provides an overview of the content requirements and the necessary documentation. The aim is to provide coherent application of the Research Premium rules and increases the predictability for the applicant. The Guidelines also.

M. Petritz / R. Stegmüller

As the deadline for applying for a reduction of preliminary tax payments for 2025 ends on September 30, 2025, and interest will be charged on tax arrears for the assessment year 2024 as of October 1, 2025, it is advisable to review the tax situation and the expected tax burden for the years 2024 and 2025 by October 1, 2025. Furthermore, the application for a refund of input VAT from other EU-countries for the year 2024 must be filed by September 30, 2025. Last but not least, financial statements with the balance sheet date December 31, 2024 have to be filed with the Austrian companies’ register until September 30, 2025. If this deadline is missed the company itself and its managing directors may be confronted with fines.

F. Kleemann / B. Stangar

After years of disagreement over the proposed Unshell Directive (or ATAD 3), it has now been decided that the Unshell Directive will no longer be pursued as a separate directive in the Council. The reason given was that there is a potential overlap between the hallmarks in the Unshell Directive and those of DAC 6. However, it will be examined whether the aims of the Unshell Directive can be achieved by clarifying or amending DAC 6 once the Commission has completed its ongoing analysis of the functioning of DAC 6. This means that no new reporting requirements are expected in this regard right now. However, it must be monitored further if and to what extent aspects of the Unshell Directive will be incorporated into the DAC 6 Directive in the future.

A. Helnwein / S. Stadik

According to the Austrian implementation of the EU Parent Subsidiary Directive, withholding tax may not be reduced at source in case of dividend distributions to parent companies without any substance (such as operative activities, business premises, employees). However, the parent company may apply for a tax refund in order to demonstrate that the holding structure serves a reasonable business purpose and may substantiate that a higher tier company disposes of the required substance. Nevertheless, in a recent case, the Austrian Federal Finance Court confirmed that only the direct parent company (even if it does not have any substance) is entitled to apply for a tax refund. The Austrian Federal Finance Court, thus, rejected the grand parent company’s application for a withholding tax refund on the grounds of the Austrian implementation of the EU Parent Subsidiary Directive. 

M. Vaishor

The Austrian Federal Finance Court has referred the question to the Constitutional Supreme Court (“VfGH”) as to whether Art 2(2)(3a) of the Bank Stability Levy Law (“StabAbgG”) (reduction of basis for StabAbgG by liquidity reserves at sectoral central institutions only in three-tier banking sectors, but not in two-tier banking sectors) is constitutional. Should the Constitutional High Court find the question too narrow, the Austrian Federal Finance Court has asked, as an in eventu question, whether the entire Art 2 of the StabAbgG (determination of the assessment basis) or, as a second question in eventu question, the entire StabAbgG is unconstitutional. An affirmative answer to the in eventu questions would lead to the abolition of the bank stability levy in its current form and would therefore have far-reaching consequences for all banks.

S. Haslinger / V. Kumer

In 2019, the tax representative of the person requesting the revision receives a notice of liability. The representative returns the notice to the tax office stating that he no longer has a valid power of attorney. As the dissolution of the power of attorney had not been communicated to the tax office before, the receipt is effective even if the taxpayer himself was not informed about this fact (Austrian Administrative Supreme Court 14^th February 2025, Ra 2024/13/0129).

C. Endfellner

The appellant has granted his tax representative a power of attorney. However, the latter did not tick the field “authority to receive documents” in FinanzOnline, which (only) indicates that this authority was not granted. If the correspondence with the tax authorities shows that a valid power of attorney exists, this also includes the authority to receive documents. If the tax office sends its documents to the appellant instead of the tax representative, this is wrong according to the Austrian Administrative Supreme Court. 

C. Endfellner

If an application for the annulment of a decision according to Art. 295 sec 4 of the Austrian General Federal Fiscal Code (BAO) was submitted in time in accordance with the legal situation at that time, this application is to be considered timely even if a later change in the law would have made the application overdue at the time of the decision (Austrian Federal Finance Court 31^st March 2025, RV/7102333/2021).

S. Papst / R. Langeneder / G. Schaunig

Pursuant to Art 279 sec 1 General Austrian Federal Fiscal Code (BAO), the Austrian Tax Federal Finance Court (BFG) must – except for certain specific cases – “always decide on the merits”. The Austrian Administrative Court Supreme recently underpinned this comprehensive procedural authority of the BFG (30^th October 2024, Ra 2024/15/0055).

S. Papst / R. Langeneder / G. Schaunig

The Austrian Federal Finance Court decided on tax evasion in the course of submitting an incorrect monthly VAT return. This offence is committed, even if there is only a temporary tax reduction until a correct annual VAT return is submitted. The offense is already fulfilled, even if no entries have been made on the tax account by the tax office due to the submission of the incorrect monthly VAT return (Austrian Federal Finance Court 23^rd May 2024, RV/2300001/2024). 

S. Papst / N. Tuschel

If it is impossible to determine the tax basis, the tax office may make an estimation. This article uses two recent decisions of the Austrian Federal Finance Court to illustrate the limits of the tax offices right for estimation.

S. Papst / G. Schaunig

Authorities are permitted to estimate tax liabilities when they cannot be derived from a company's records. In the case of a dog breeder who did not maintain complete records for her business and failed to submit tax returns, the estimates of her revenue were primarily based on statements from veterinarians regarding the frequency of vaccinations administered to her puppies (Austrian Federal Finance Court 5^th December, RV/2300016/2024).

S. Papst / E. Hemetsberger

The amendment to the Austrian Beneficial Owners Register Act (BORA) published December 2024 introduced extensive new due diligence and reporting obligations in connection with fiduciary arrangements (so called “nominee agreements”). In particular, new disclosure obligations must be observed by nominees and nominee directors since January 1^st, 2025. Pursuant to this BORA legislation all new due diligence and reporting obligations will become effective step-by-step, together with new financial criminal offenses, as of October 1^st, 2025, and finally as of December 1^st, 2025. Important: Penalties of up to EUR 200,000 apply here once again.

S. Papst / C. Edelhauser / W. Gurtner

Due to a report of the journal Profil in early April 2025, the Austrian Constitutional Court instigated the formal review of the Beneficial Owners Register Act (BORA) based on the appeal of one of its investigative journalists arguing that the constitutional freedom of expression and information were violated by this legislation.

The Austrian Constitutional Court raised concerns over the constitutionality of Art 10 and 10a BORA as these provisions may cause a disproportionate restriction for “public watchdogs” having to prove a “legitimate interest” in order to access UBO-relevant data in the Austrian UBO-Registry. According to the Court´s decision of March 11, 2025, E 2888/2024-17, the current restrictions of access for third parties pursuant to BORA may contradict their constitutional rights of freedom of expression and information acc. to Art 10 ECHR. The final decision of the Constitutional Court in this matter is still pending, after the Austrian Government provided a written statement.  

C. Edelhauser

Anyone who fails to comply with their obligation to report according to Art 5 Beneficial Owners Register Act (BORA-Act) despite being requested to do so twice is guilty of a financial offense. In practice, this is the most common financial offense under the BORA-Act. The article shows current case law of the Austrian Federal Finance Court (BFG) on various case constellations.

S. Papst / G. Schaunig