Austria Global Payroll & Tax Information Guide

Last updated in July 2025.

Managing payroll in Austria in 2025 requires a detailed understanding of wage taxes, social security contributions, and employment law. This comprehensive Austria payroll and tax guide provides HR, finance, and global mobility professionals with everything needed for compliant and efficient payroll operations.

Austria Payroll - 2025 Updates

• Income tax brackets indexed +3.83% for inflation

• Employer social contribution rates increased to support public programs

• Continued 55% top tax rate on income over €1 million

• New benefits: employment tax credits, transit pass exemptions, and home-office allowances

Austria Payroll - Basic Facts

• Payroll cycle: Monthly (14 payments - 12 salary + holiday + Christmas bonuses)

• Workweek: Standard 40 hrs; some sectors have 38 hrs under CBAs

• Payslips: Must itemize gross pay, deductions, contributions, and net salary

• Filing deadlines: Payroll taxes and social contributions due by the 15th of each month

• Tax year: Calendar year

• E‑filing requirements: Monthly electronic submission

Austria Income Tax Rates 2025

Austria applies a progressive income tax system:

Tax credits include family benefits, single-earner relief, home-office costs, and transport allowances.

Austria Employer & Employee Social Contributions

Subject to monthly and annual contribution caps.

Employee Contributions (~18.07% total):

• Health: 3.87%

• Pension: 10.25%

• Unemployment: 2.95%

• Miscellaneous: 1.00%

Employer Contributions (~22.51% total):

• Health: 3.78%

• Pension: 12.55%

• Unemployment: 2.95%

• Accident: 1.10%

• Plus: severance fund, family equalization, municipal payroll tax, chamber levy

Other Tax Types in Austria

• Corporate Income Tax: 25%

• Capital Gains & Dividends: 27.5%

• VAT: 20% standard (with 10% / 13% reduced rates)

• Real Estate Transfer Tax: ~3.5%

• Municipal Payroll Tax: ~3%

• Chamber Levy: Location-dependent

Working Hours, Overtime & Leave

• Standard workweek: 40 hrs; max 60 hrs with overtime

• Overtime pay: ≥150% or comp time

• Rest periods: 11 consecutive hrs/day, 36 hrs/week

Leave entitlements:

• Annual leave: 25 days (5-day week) or 30 days (6-day week)

• Public holidays: 13 days/year (+ regional holidays)

• Sick leave: Full pay for 6–12 weeks; half pay up to 4 weeks

• Maternity leave: 16 weeks (8 pre/post-birth)

• Paternity leave: 1 month within 91 days post-birth

• Parental leave: Unpaid up to child’s second birthday

• Other: emergency, marriage, bereavement, educational leave

Public Holidays in Austria - 2025

• New Year’s Day - Jan 1

• Epiphany - Jan 6

• Easter Monday - Apr 21

• Labour Day - May 1

• Ascension Day - May 29

• Whit Monday - Jun 9

• Corpus Christi - Jun 19

• Assumption Day - Aug 15

• National Day - Oct 26

• All Saints’ - Nov 1

• Immaculate Conception - Dec 8

• Christmas Day - Dec 25

• St. Stephen’s Day - Dec 26

Foreign Workers & Payroll Compliance

• Work permits: Required for non-EU/EEA workers (Red‑White‑Red Card)

• Tax residency: 183+ days or domestic residence

• Double tax relief: Austria has treaties with 90+ countries

• Social security: Mandatory unless exempt under bilateral agreements

• Employer obligations: Register foreign staff, manage wage tax and social contributions, and ensure immigration compliance

Austria Payroll Compliance & Integration Steps

Payslip’s platform ensures seamless Austria payroll and tax compliance by:

1. Integrating with local payroll providers

2. Automating monthly filings and e‑submissions

3. Centralizing payroll data and reporting

4. Ensuring multilingual support and CBA management

FAQ Section

• What is the income tax rate in Austria for 2025?
  Austria uses a progressive system from 0% up to 13,308 €, rising to 55% for incomes above 1 million €.

• How much are social security contributions in Austria?
  Employees contribute ~18.07%, and employers ~22.51%, both on capped earnings.

• Does Austria have a minimum wage in 2025?
  Austria doesn’t have a national minimum wage; instead, collective bargaining agreements set industry-specific minimums.

• What are the public holidays in Austria in 2025?
  There are 13 nationwide public holidays, plus additional regional holidays.

• What are employer payroll obligations in Austria?
  Monthly registration, wage tax withholding, social security contributions, electronic filings, and compliance with work permits and labor laws.

Book your demo today to streamline payroll, reduce risk, and maintain global compliance in Austria.