- The Austrian group taxation regime enables cross-border tax consolidation and promotes foreign investments of, or through Austrian entities.
- Expansion to foreign markets through Austria can be financed by tax savings. Foreign losses can be offset against Austrian profits, thus reducing taxable base for CIT.
- Applicable for holding structures and groups of companies.
Loss Carry Back
- Fiscal measures allowing a temporary loss carry back of 100 % of the losses capped at EUR 5 Mio. in 2020 to either financial year 2019 or 2018.
- Applicable to all forms of entities as well as group taxation purposes.
- Reduced tax payments in each of the given years as well as tax refund in case of a carried back loss.
Mandatory Disclosure Rules for Cross-Border Tax Planning Measure (DAC 6)
- With July 1, 2020 the individual taxable person is obliged to report tax models dating back to 2018, should they be subject to a reporting obligation under the EU-MPfG.
- Under the EU-MPfG certain structuring and restructuring measures have to be reported to the fiscal authorities, if there is a risk of tax avoidance or evasion.
Interest Limitation Rule
- According to the basic rule of the interest limitation rule, exceeding borrowing costs in a financial year are only deductible to the extent of 30 % of the tax EBITDA of that financial year.
- However, exceeding borrowing costs of up to EUR 3 Mio. per assessment period are deductible without restrictions.
- This is applicable for domestic corporations (GmbH, AG, SE) and other legal persons such as private foundations. In addition, foreign corporations with limited tax liability that maintain a permanent establishment in Austria are also affected by the new regulation.
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