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Refund of withholding tax on secondment of staff

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Whether you are a company, self-employed or an employee.

Withholding tax (Auftraggeberhaftung)

If you, as a foreign company, second your staff to an Austrian customer on a temporary assignment, the Austrian customer will deduct a withholding tax of 20% from your invoices.

You can apply for a refund from the Austrian tax office, but only after the end of the calendar year in question, which can take 9-12 months for the Austrian tax office to process.

Exemption from withholding tax in Austria?

If you want to avoid these deductions, you have to have your employees’ wages processed according to Austrian rules and pay the payroll tax to the Austrian tax office. You can then apply to the Austrian tax authorities for an exemption from withholding tax. The exemption is valid for half a year and can be renewed periodically. The issuance of the exemption as well as its extension is subject to the timely payment of payroll tax for the employees and the absence of arrears to the Austrian tax authorities.

Frequent questions

When will the customer charge me withholding tax?

Your customer will deduct 20% from each invoice if you carry out work in Austria through the temporary secondment of your staff.

Can I apply for withholding tax refund?

Yes, of course, you can apply for a withholding tax refund, but you should expect a relatively long processing time, sometimes 9-12 months.

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