B. Income from employment obtained from abroad

Who has income from abroad and must file Form L 1i?

Income from employment obtained from abroad is the income that you have obtained:

as a cross-border employee, or
from a foreign employer who is not required to deduct wage tax in Austria; or
from a foreign diplomatic mission or an international organisation in Austria (e.g. UNO, UNIDO) or
from a foreign pension, or
on the basis of a double taxation agreement, or
on the basis of the progression proviso that must be declared in Austria.

This includes, for example, foreign sickness benefits, foreign unemployment benefits, and foreign insolvency benefits. Such income is taxable in Austria.

If you have received any income from employment abroad that is taxable in Austria, please complete Form L 1i and please also inform the tax office of these incomes under code 453 in Form L 17 (wage statement / pay statement) or under code 359. For all other foreign income, in addition to Attachment L 1i, an income tax return (Form E 1) must be used instead of Form L 1, and code 440 must be completed.

If you are subject to limited tax liability and have also received other income, use only Form E 7 (income tax return for limited tax liability). In this case, Attachment L 1i may not be used.

Who must complete Form L 17?

If the income is fully taxable in Austria and domestic tax benefits are to be taken into account, please send Form L 17, which must be completed in these cases, to your tax office. Please refer to the completion instructions L 17a and L 17b if you need assistance when completing these forms. You must in any case submit Form L 17 to the tax office if your foreign income subject to tax liability in Austria is paid out 13 or 14 times per calendar year (with extra payments). The tax benefits, such as the preferential tax rate for extra payments or taxes withheld in the source country related to this income, can be considered only by means of the fully completed Form L 17.

In Form L 1i, you must disclose the number of wage statements / salary statements, as well as all income-related expenses related to this foreign income that are not to be entered in Form L 1 or Form L 17. Private health insurance contributions on the basis of a foreign insurance obligation must, in any case, be entered under code 187 in Form L 1i. These private health insurance contributions must not be included under codes 357/347 in Form L 17. Other income-related expenses must be recorded in Form L 1i under code 154 or code 544.

If your employer has fully completed Form L 17 as required and filed it electronically via elda.at, there is no need to attach an additional Form L 17 to the tax assessment, provided you believe the information has been correctly completed.

Simplified procedure if you receive income from abroad without extra payments (Code 359 in Form L 1i)

If you receive foreign income (active or retirement income) for which Austria may collect taxes and which is paid out only twelve times in a calendar year (without extra payments), you may simply record the amount of your foreign income (gross revenue minus income-related expenses) in Form L 1i under code 359. The social security contributions taken into account in determining the income must be reported under code 183. For proper consideration of the statutory tax deductions, please inform the tax office also as to whether the foreign income includes only pension benefits. Please also disclose to the tax office any foreign tax under code 377 if it may possibly be recognised in Austria.

If the two aforementioned requirements are met for your foreign income, you do not have to complete Form L 17. Foreign income subject to progression must only be entered under code 453 in Form L 1i.

Who must complete code 453 in Form L 1i?

In the case of unlimited tax liability in Austria, code 453 in Form L 1i must be used to report foreign income from employment (including pensions, unemployment benefits, sickness benefits, insolvency benefits, etc.) that is tax-exempt in Austria but subject to progression proviso. The amount of foreign income must be indicated when the national progression proviso or a double taxation agreement with exemption method applies, or when an Austrian employer submitted a pay slip without withheld wage tax for work performed abroad.

Under code 453 of Form L 1i, income taxable abroad must be entered net of social security contributions that are due on these amounts and other income-related expenses (gross revenue minus income-related expenses). Social security contributions must be reported under code 184 in Form L 1i. In the checkbox field, it is mandatory to tick whether these social security contributions can be considered tax-reducing abroad (one of the boxes must be ticked). Other income-related expenses must be entered under code 493 in Form L 1i. These codes must be fully completed, and a value of zero should be entered if applicable. For foreign pension income, you must also complete code 791 in Form L 1i to ensure that tax deductions are automatically taken into account.

When are you required to file an employee tax assessment with Attachment L 1i (mandatory assessment)?

The primary distinction is between unlimited and limited liability to pay taxes (see page 8). An assessment must be carried out if you are subject to unlimited tax liability because in 2024 you had your place of residence or regular domicile in Austria and have received income:

as a cross-border employee,
from a foreign employer who is not obligated to deduct wage tax in Austria;
from a foreign diplomatic mission or an international organisation in Austria (e.g. UNO, UNIDO)
from a foreign pension.
from third parties without income tax deduction
from start-up employee profit-sharing
that is also taxed abroad and where the double taxation agreement determines the credit method
that is tax-exempt in Austria but subject to the progression proviso.

A mandatory assessment with the Supplement L 1i must also be filed if in 2024 you were subject to limited liability to pay taxes because you did not have a place of residence or your regular domicile in Austria, but:

you received income for an activity in Austria from a foreign employer who is not obligated to deduct wage tax in Austria, and under a double taxation agreement Austria has the right to tax this income.

A mandatory assessment will also be made if an employee subject to limited liability to pay taxes:

has, at least temporarily, received income subject to wage tax from several employers at the same time that was taxed separately when deducting wage tax,
if, in addition to income subject to wage tax, other income subject to assessment exceeding € 730 per year was received.

In this case, please submit Form L 1 along with Attachment L 1i. You can find general information about mandatory tax assessments in Chapter VI.

In which cases can you apply for an employee tax assessment and possibly receive a refund of any withholding tax or wage tax (employee tax assessment upon application)?

You have a limited liability to pay taxes because in 2024 you did not have a place of residence or your regular domicile in Austria, but received taxed income in Austria:

from an employer who has deducted wage tax;
from a domestic pension, or
from an employment as a writer, lecturer, artist, architect, athlete or performer in an entertainment show, where an amount of 20% or 25% withholding tax, respectively, was deducted.

If wage tax is deducted in Austria for an employee with limited liability for tax, the wage tax is calculated as for any other Austrian employee. However, if there is no compulsory assessment, in the course of a voluntary employee tax assessment an amount of € 10,486 is added to the tax assessment base, i.e. before computing the income tax (see page 8).

Where are persons resident in Austria taxed for foreign income?

This question can be answered only on the basis of the double taxation agreement between Austria and the respective source country. The double taxation agreement determines which country is entitled to collect taxes on these earnings (you will find a list of all double taxation agreements at bmf.gv.at). Thereby double taxation of the income is avoided. For persons resident in Austria (pursuant to double taxation agreements), as a rule Austria has the right to tax the global income. The domicile for tax purposes is the State where the taxpayer, as defined by the respective double taxation agreement, is a resident, meaning they have a permanent residence. If an individual has a residence in both contracting states, this constitutes a so-called dual residence. Therefore, determining residency depends on where focal point of vital interests lies. The distinction primarily considers personal and economic circumstances of the taxpayer.

If the double taxation agreement determines that Austria has the right to tax, you must indicate these foreign incomes in Form L 1i under code 359 and possibly also in Form L 17. If you reside in Austria and the right of taxation is (also) allocated to the foreign state, it must be determined whether the double taxation in Austria is avoided by applying the exemption or the credit method.

Note

Persons who reside in Austria and receive pensions from Germany (retirement pensions) are sent tax forms from the tax office of Neubrandenburg. The German pensions from statutory social security are exempted from tax in Austria due to the Austro-German double taxation agreement. However, Austria considers the German pensions in the calculation of the tax on the remaining income that is taxable in Austria (progression proviso).

Thus, no double taxation is performed. Rather hereby those taxpayers who receive pension income across the border and those who receive one or more pensions from Austrian employers/sources in Austria are treated equally. The progression proviso in Austria is mandatory. Therefore, the entire German pensions from compulsory social security are to be declared in the context of income tax or employee tax assessment in Form L 1i under code 453. These incomes may be included neither under code 359 nor in the wage statement (Form L 17). For more information on completing Form L 1i and examples, see page 154.

How is double taxation avoided by application of the exemption method (progression proviso)?

Incomes from abroad from employment or foreign pension remunerations are tax-exempt under the progression proviso, if so agreed between Austria and the respective source country on the basis of a double taxation agreement. The foreign incomes themselves are not taxed upon application of the exemption method in Austria. Since in the case of persons with unlimited tax liability, Austria has the right to tax the global income, foreign incomes are to be considered in the determination of the tax rate that is to be applied to the taxable income in Austria. Since foreign income is not taxed in Austria, crediting of the foreign tax is not possible. Please enter the income that must be considered when determining the tax rate to apply the progression proviso under code 453 in Form L 1i and, in case of pensions, again under code 791. Social security contributions must be deducted from the income to be entered under code 453. The amount of the social security contributions taken into account must be entered under code 184. In any case, in the checkbox under point 4.2 in Form L 1i, you must check whether these social security contributions can be deducted abroad to reduce tax. The "yes" box must be ticked if, for example, you are subject to unlimited tax liability in Germany or could opt for unlimited tax liability in Germany. In these cases, the social security contributions can also be taken into account abroad for tax-reducing purposes.

Any other income-related expenses that are related to German pension income must also be deducted from the code 453 in Form L 1i and additionally entered under code 493.

How is double taxation avoided by application of the credit method?

If the double taxation agreement between Austria and the respective source country provides that the foreign income for which tax was paid abroad be taxed in Austria as well, then Austria as country of residence recognises the foreign tax that corresponds to the Austrian tax (maximum offsetting amount). If the double taxation agreement provides that the credit method is applied and you must complete Form L 17, please indicate the foreign tax withheld in the source country under code 358. If you record the income (excluding extra payments) under code 359 in Form L 1i, also complete code 377. The amount of social security contributions that were taken into account when determining the income for code 359 must be entered under code 183 in Form L 1i. If your employer submitted a pay slip (pay slip type 24), complete the fields in point 2.3 of Form L 1i.

Please note that only the withheld source tax legitimately deducted for this income under the double taxation agreement can be credited. If a higher amount than stipulated in the double taxation agreement was withheld, you must apply for a refund of the excess tax in the respective source country. It is not possible to credit the excess amount.

Examples of income from abroad

To aid comprehension, see here an example of the full taxation of foreign income in Austria, examples to explain the terms "exemption with progression proviso" and "taxation with crediting" as well as an example of home office.

Example: Full taxation right in Austria

A resident of Austria receives pension income from Austria and an additional income in the form of a company pension from Germany. Under the double taxation agreement, Austria has the right to tax the German company pension. Therefore, both the income from the Austrian pension and the German company pension are fully taxed in Austria. If the German company pension is paid out only twelve times per calendar year (thus excluding bonuses), to simplify things, in Form L 1i the German pension income can be entered under code 359. To ensure that the tax deductions are applied in the correct amount, it must also be indicated if the code 359 contains only pension benefits. The amount of social security contributions that were deducted when determining the income must be entered under code 183 in Form L 1i. Form L 17 must only be completed if a foreign pension with extra payments was received. In this case, in addition to the necessary information in Form L 1i, Form L 17 must also be submitted. No entries must be made under code 359. A tax incorrectly paid in Germany under the double taxation agreement cannot be credited (see page 147).

Example: Exemption with progression proviso in Austria (exemption method)

A resident of Austria receives pension income from Austria and an additional income in the form of a social security pension from Germany. This income from the German social security pension will be taxed only in Germany according to the double taxation agreement. In Austria, this income is tax-exempt under the progression proviso. The German income (gross revenue minus income-related expenses) from the social security pension must therefore be entered in Form L 1i under the code 453 and also under code 791. The amount of the social security contributions taken into account must be entered under code 184. In the checkbox under point 4.2, you must indicate whether these contributions could have been deducted for tax purposes abroad or not. One of the boxes must be ticked. The "yes" box must be ticked if, for example, you are subject to unlimited tax liability in Germany or could opt for unlimited tax liability. The "no" box must be ticked if, for instance, due to limited tax liability in another EU Member State, the statutory social security contributions cannot be deducted for tax-reducing purposes there. Any other income-related expenses (excluding code 184) must be entered under code 493.

These incomes may be included neither under code 359 nor in the Form L 17. A tax paid abroad cannot be credited. The foreign income is not taxed upon application of the exemption method in Austria.

Example: How do you determine and record income from statutory social security in Germany?

If you receive a pension from the German Federal Pension Insurance Fund (Deutsche Rentenversicherung Bund), you will also receive a supplement for Austrian health insurance. This supplement is taxable in Austria. The taxable pensions (annual amount of the pension plus supplement) corresponds to the gross revenue taxable in Austria. Under code 453 of Form L 1i, the income (gross revenue minus income-related expenses) must be recorded. The total pension amount received must therefore be reduced by the health insurance contributions paid. The social security contributions considered when calculating the tax-exempt foreign income must be entered under code 184 in Form L 1i. If you had no additional income-related expenses, a value of zero must be recorded under code 493. If code 453 includes only foreign pension income, this amount must also be entered under code 791.

Annual amount of pension € 8,000

+ 2.55% supplement for health insurance + € 204

– 5.10% Austrian health insurance – € 408

Code 453 Foreign pension income € 8,204

Code 184 Considered social security contributions € 408

Code 493 Additional income-related expenses € 0

Code 791 Pension income included in Code 453 € 8,204


Annual amount of pension	€ 8,000
+ 2.55% supplement for health insurance	+ € 204
– 5.10% Austrian health insurance	– € 408
Code 453 Foreign pension income	€ 8,204
Code 184 Considered social security contributions	€ 408
Code 493 Additional income-related expenses	€ 0
Code 791 Pension income included in Code 453	€ 8,204

Example: How do I correctly complete the checkbox for code 184 in Form L 1i?

For the social security contributions recorded under code 184 in Form L 1i, you are required to indicate whether the social security contributions entered under code 184 can be considered for tax-reducing purposes abroad (one of the checkboxes must be ticked). Whether you could be treated as a person with unlimited tax liability in Germany can be determined from the reason provided in your German income tax assessment.

Tick Yes if your application in Germany was approved.

Tick No if your application in Germany was not approved, and you were assessed as a person with limited tax liability.

Note

Statutory social security contributions are generally to be subtracted when calculating the related income. However, in cases where limited tax liability in another EU member state prevents these statutory social security contributions from being deducted there, they may be deducted from Austrian income. Rz 244a

If, in your case, the social security contributions were not deducted abroad to reduce tax, you should tick "no" in the box under code 184 under point 4.2 on the Form L 1i 2024. You are required to tick the appropriate box.

Example: Taxation with crediting in Austria (credit method)

A resident of Austria derives income from employment (active income) as a cross-border employee in Liechtenstein. Liechtenstein as the country of activity is permitted by the double taxation agreement to retain a gross withholding tax of 4% in the case of cross-border employees, which is to be offset in Austria under the double taxation agreement. In addition to the information provided in Form L 1i (point 2.2), Liechtenstein-based income must be reported in Form L 17, and the tax legitimately withheld in Liechtenstein under the double taxation agreement must be recorded under code 358. It is not possible to credit an amount exceeding this in Austria. The refund of any excess tax withheld must be requested in the respective source country.

Example: Home office

A resident of Austria derives income from employment (active income) while also working some days from a home office in Austria. The remuneration must be divided between the domicile for tax purposes and the employer's state according to the working days spent in each respective state. Working days spent in Austria in the home office are subject to taxation in Austria (code 359 in Form L 1i or L 17). Working days spent in Hungary are subject to taxation in Hungary, with Austria exempting them under a progression proviso (code 453 in Form L 1i). The number of home office days must be reported in Form L 17.

Did you have any income that was taxed abroad, and is relief granted by the foreign tax authority?

In the event that your income is taxable in Austria as well and you have received or applied for relief from foreign tax by the foreign tax authority, please enter this under code 775.

What is an activity within the meaning of section 99 para. 1 item 1 of the Austrian Income Tax Act 1988 (EStG, Einkommensteuergesetz)?

An activity within the meaning of section 99 para. 1 item 1 of the Austrian Income Tax Act 1988 (EStG, Einkommensteuergesetz) is present if you do not have a place of residence or regular domicile in Austria (limited liability to pay taxes) and were active under an employment contract as a writer, lecturer, artist, architect, athlete, performer or contributor in art performances. The employer must withhold wage tax totalling 20% or 25%, respectively. Thus, the employee with limited liability to pay taxes has fulfilled his/her liability to pay tax in Austria (see page 8). A voluntary assessment of all income from employment is possible upon application (point 5.1 in Form L 1i).

How do you apply for assessment with limited tax liability?

If you are applying for assessment with limited tax liability, you are required to submit both Form L 1 and Form L 1i, with Points 1 and 5 completed. The assessment upon application will only be processed by the tax office if you have ticked the corresponding box 5.1 or 5.2.

How do you apply for the option for unlimited tax liability?

If you wish to also apply for the option for unlimited tax liability (Section 1, para. 4 Austrian Income Tax Act 1988) during the assessment, you must fully complete Points 1 and 6 in Form L 1i.

Who can apply for unlimited tax liability?

If you are subject to limited liability to pay taxes in 2024, because you had neither a place of residence nor your regular domicile in Austria, you can apply, provided that you are a citizen of an EU Member State or an EEA State or of a state with which Austria has double taxation agreements with non-discrimination clauses, for unlimited tax liability in Austria. This applies only if your income in the calendar year is subject to at least 90% to the Austrian income tax, or the income not subject to Austrian income tax amounts to no more than € 12,816. This must be proven by a corresponding certification of your country of residence (Form E 9).

Why is updating your personal data important?

You are required to inform the tax office of your current residential address. If you fail to notify the tax office of your current address but are aware of an ongoing procedure with the tax office, service may be carried out by deposit in accordance with the Service of Documents Act. If you are unaware of the ongoing procedure, service may be effected by public notice under the Service of Documents Act (e.g., in the case of estimates following mandatory tax assessments).

When can you file an application for refund with the Tax Authority for Large Traders?

An application for refund of wage tax withheld in Austria pursuant to a double taxation agreement under Section 240 of the Austrian Federal Tax Code must be submitted to the Tax Authority for Large Traders.

The table below covers standard cases related to income from employment from neighbouring countries. As there are, depending on the double taxation agreement, many exceptions and restrictions (e.g. home office days), for a correct tax assessment it will in most cases be inevitable to obtain information pertaining to the double taxation agreement in question, or from a competent source (e.g. tax office).

Income from neighbouring countries — tax treatment overview

Income from	Tax treatment of income in/from	Active income — Domicile ≤ 183 days, no local employer or permanent DTC establishment	Active income — Domicile > 183 days or local employer or permanent DTC establishment
Germany	Abroad	Exemption	Taxation
Germany	Austria	Full taxation	Exemption with progression proviso
Liechtenstein	Abroad	Exemption	Taxation
Liechtenstein	Austria	Full taxation	Taxation with crediting
Switzerland	Abroad	Exemption	Taxation
Switzerland	Austria	Full taxation	Taxation with crediting
Italy	Abroad	Exemption	Taxation
Italy	Austria	Full taxation	Taxation with crediting
Slovenia	Abroad	Exemption	Taxation
Slovenia	Austria	Full taxation	Exemption with progression proviso
Hungary	Abroad	Exemption	Taxation
Hungary	Austria	Full taxation	Exemption with progression proviso
Slovakia	Abroad	Exemption	Taxation
Slovakia	Austria	Full taxation	Exemption with progression proviso
Czech Republic	Abroad	Exemption	Taxation
Czech Republic	Austria	Full taxation	Exemption with progression proviso