Income Tax in Austria 2026 and 2027: Tax Brackets, Tax-Free Threshold and Calculator

Austria’s income tax (Einkommensteuer) is calculated progressively across several tax brackets. Tax is assessed annually, and natural persons with a registered residence in Austria are liable for income tax when their annual income creates a tax obligation.

Taxable income means total income reduced by special expenses, extraordinary burdens and child-related tax benefits. The final amount is determined on the basis of the income tax return.

Austria’s 2026 income tax rates

In 2026, the thresholds increased by 1.7333%, representing two thirds of inflation of 2.6%. The first 13.539 euros of taxable income is tax-free.

• Up to 13.539 euros: 0%
• Above 13.539 up to 21.992 euros: 20%
• Above 21.992 up to 36.458 euros: 30%
• Above 36.458 up to 70.365 euros: 40%
• Above 70.365 up to 104.859 euros: 48%
• Above 104.859 up to 1.000.000 euros: 50%
• Above 1.000.000 euros: 55%

The 55% rate on the portion of annual income above 1 million euros applies by law until 2029. After that, this bracket will also be taxed at 50%. Updated figures can be checked on the official Austrian business portal, USP.

Example: 40.000 euros of taxable income

For taxable annual income of 40.000 euros in 2026, the first 13.539 euros is tax-free. The next 8.453 euros is taxed at 20%, the next 14.466 euros at 30%, and the remaining 3.542 euros at 40%. Before tax credits are deducted, the total income tax is 7.447,20 euros.

Income tax calculator for 2026

An income tax calculator can apply the Austrian tax brackets to your annual taxable income and show both the average rate and the marginal rate. As a check, taxable income of 40.000 euros produces income tax of 7.447,20 euros before tax credits, matching the example published on the USP portal.

Austria’s 2027 income tax rates

The 2027 tax brackets have been announced in BGBl. II Nr. 260/2026. In 2027, the first 13.846 euros of taxable income will be tax-free.

• Up to 13.846 euros: 0%
• Above 13.846 up to 22.491 euros: 20%
• Above 22.491 up to 37.285 euros: 30%
• Above 37.285 up to 71.960 euros: 40%
• Above 71.960 up to 107.236 euros: 48%
• Above 107.236 up to 1.000.000 euros: 50%
• Above 1.000.000 euros: 55%

Further information is available in RIS: EStG section 33, notes for 2027.

2025 income tax rates

For comparison, the tax-free threshold was 13.308 euros in 2025, 12.816 euros in 2024 and 11.693 euros in 2023.

• Up to 13.308 euros: 0%
• Above 13.308 up to 21.617 euros: 20%
• Above 21.617 up to 35.836 euros: 30%
• Above 35.836 up to 69.166 euros: 40%
• Above 69.166 up to 103.072 euros: 48%
• Above 103.072 up to 1.000.000 euros: 50%
• Above 1.000.000 euros: 55%

Because the system is progressive, each rate applies only to the portion of income within the relevant bracket, rather than to the entire income.

Single-earner and single-parent tax credit

The single-earner tax credit (Alleinverdiener) is available to a person who lives with at least one child in a marriage, registered partnership or cohabiting relationship for more than 6 months of the calendar year, provided the partner’s annual income does not exceed the applicable limit. This limit is 7.411 euros in 2026 and 7.284 euros in 2025.

A single parent (Alleinerzieher) is a person who does not live with a partner for more than 6 months of the calendar year, lives with at least one child and receives family allowance for more than 6 months. Both situations qualify for the same credit. Anyone who does not meet these conditions is not entitled to it.

The credit can be claimed during the year through the employer using the E 30 form, or afterwards in the annual employee tax assessment (Arbeitnehmerveranlagung).

AVAB amounts

• 2026: 612 euros for 1 child, 828 euros for 2 children, plus 273 euros for each additional child
• 2025: 601 euros for 1 child, 813 euros for 2 children, plus 268 euros for each additional child
• 2024: 572 euros for 1 child, 774 euros for 2 children, plus 255 euros for each additional child
• 2023: 520 euros for 1 child, 704 euros for 2 children, plus 232 euros for each additional child
• 2022: 494 euros for 1 child, 669 euros for 2 children, plus 220 euros for each additional child

The amount shown for 2 children is the total annual amount for two children. The amount for the third and every additional child is added separately.

Workplace allowance for self-employed people working from home

Self-employed people working from home can deduct up to 1.200 euros per year for maintaining their work environment through the Arbeitsplatzpauschale, provided they have no other premises outside their home for their business activity.

The full 1.200-euro allowance is available when there is no other active income, such as employment income, for which a workplace outside the home is available, or when that income is no more than 13.539 euros in 2026 (13.308 euros in 2025).

Above this limit, the smaller allowance of 300 euros per year applies. In addition, the cost of ergonomic furniture, such as a desk, office chair or lighting, can be deducted separately up to 300 euros per year. If the activity starts or ends during the year, one twelfth of the annual amount applies for each month.

Practical steps

1. Calculate your annual taxable income, not simply your total gross income.
2. Apply the tax brackets for the relevant year: 2026, 2027 or the year covered by your tax return.
3. Check whether special expenses, extraordinary burdens or child-related tax benefits reduce your taxable income or tax payable.
4. If you qualify as a single earner or single parent, claim the credit with your employer using the E 30 form or through Arbeitnehmerveranlagung.
5. If you are self-employed and work from home, check whether the Arbeitsplatzpauschale and ergonomic furniture deduction apply.
6. Verify the current figures through USP or RIS, as Austrian tax rules and benefits can change.