Austria Income Tax Brackets 2026: Rates & Examples

Editorial note: This guide is general information and does not replace individual tax advice. All bracket and allowance figures were verified against BMF Steuertarif, WKO 2026 values, USP.gv.at tax brackets and the BMF Tax Book 2026 (EN, PDF). Last reviewed: May 2026. All figures without warranty.

Austria's 2026 income tax brackets at a glance

From 1 January 2026, Austria's wage tax (Lohnsteuer) brackets shifted upward by 1.7333 percent — two thirds of the BMF's measured inflation rate of 2.6 percent. This is the third and final phase of the automatic indexation that ended cold progression (kalte Progression). The top bracket above one million euros remains at 55 percent and is not adjusted for inflation.

If you're an employee in Austria, your employer withholds wage tax monthly based on these brackets. Self-employed and freelance income lands in the same brackets but is settled annually through the income tax return. The numbers below come straight from the BMF's inflation adjustment ordinance for 2026.

For the filing process — deadlines, FinanzOnline, deductions — see our Austria tax return guide 2026. For a broader overview of what changed in 2026, see Everything that changed in Austria 2026.

Tax brackets 2026: Marginal rates by income

Effective 1 January 2026. Source: BMF, WKO, USP.gv.at.

The figures refer to your annual taxable income (Bemessungsgrundlage), which is gross salary minus social security contributions and minus deductions for income-related expenses. Austria uses progressive marginal taxation: each bracket only applies to the portion of income that falls within it, not to your total income.

How the calculation works

Take a taxable income of €30,000 as an example. The tax breaks down like this:

• €0 to €13,539 → 0% → €0
• €13,539 to €21,992 → 20% → €1,690.60
• €21,992 to €30,000 → 30% → €2,402.40
• Tariff tax: €4,093.00 (before allowances)

The WKO publishes shortcut formulas per bracket that give the same result in a single calculation.

What changed in 2026

Austria's BMF issued the 2026 inflation adjustment ordinance in autumn 2025. The headline points:

• Adjustment factor: +1.7333 percent on every bracket except the top one
• Tax-free threshold: raised from €13,308 (2025) to €13,539
• Top rate of 55 percent: unchanged, applies above €1,000,000, still time-limited
• Allowances: valorised proportionally (see next section)
• Social security ceiling: €6,930 per month (up from €6,450), €13,860 annually for special payments

The increase is smaller than 2024 or 2025 because measured inflation has fallen back. It still translates into a real net gain: someone earning the same gross salary as in 2025 keeps more after tax in 2026.

2026 tax allowances (Absetzbeträge)

Austrian tax allowances are direct credits — they reduce your calculated tax euro for euro, not your taxable income. One euro in allowances saves exactly one euro in tax.

Source: WKO, BMF Tax Book 2026, AK Steuerwertetabelle 2026.

The Pendlerpauschale (commuter lump sum), Pendlereuro (commuter euro per kilometre) and child allowance (Kinderabsetzbetrag) are intentionally not listed here as round euro figures — they are graduated by distance and public transport access. The exact 2026 values are documented in the BMF Tax Book 2026 (EN, PDF).

Special payments tax: How 13th and 14th salaries are taxed

Austrian employees normally receive 14 monthly payments per year — twelve regular salaries plus the holiday bonus (Urlaubsgeld) in summer and the Christmas bonus (Weihnachtsgeld) in November. These special payments (Sonderzahlungen) get a separate, much lower tax schedule within an annual cap called the Jahressechstel (one sixth of the year's wages).

Source: § 67 EStG, BMF Tax Book 2026.

For most employees this means the bulk of the 13th and 14th salary lands in the 6 percent band, with the first €620 per year tax-free. It is one of the structural reasons why net pay in Austria looks better than the marginal rates suggest.

2026 net salary examples

Figures below are approximations using the 2026 BMF tariff, an assumed social security rate of 18.12 percent on regular pay and 17.12 percent on special payments, and the basic commuter allowance of €496 — without Familienbonus or Pendlerpauschale. Adding kids or a long commute pushes the net higher.

€3,000 gross per month (€42,000 per year)

€5,000 gross per month (€70,000 per year)

€8,000 gross per month (€112,000 per year)

For an exact calculation, the Austrian Chamber of Labour's gross-net calculator lets you enter Familienbonus, Pendlerpauschale and family-specific allowances individually.

2026 social security contributions

Social security rates are unchanged in 2026; the contribution ceiling rose:

2026 social security ceiling: €6,930 per month, €13,860 annually for special payments, €231 per day (source: vorlagenportal.at, ÖGK).

Negative tax and SV refund 2026

Employees who earn so little that the calculated tariff tax falls to zero after allowances can get part of their paid social security back. This refund (umgangssprachlich Negativsteuer) for 2026:

• Active employees without commuter allowance: up to €496
• Active employees with commuter allowance entitlement: up to €804
• Pensioners: up to €723

The refund is paid out only via the annual tax return — never automatically on the payslip. Anyone who skips the return leaves this money on the table. See our Austrian tax return guide 2026 for how to file.

Wage tax vs. income tax: What expats need to know

Austria has one tax called Einkommensteuer (income tax). Lohnsteuer (wage tax) is the same tax — just collected at source from employees by their employer, in advance. Self-employed and freelance work is taxed under the same brackets but settled annually.

If you only earn salary, your final tax position is usually correct after the year-end run, and any refund happens through the Arbeitnehmerveranlagung. If you have side income above €730 per year, you must file a full income tax return that combines all sources of income.

If you also have personal financing needs alongside your salary, the Austrian loan guide lists current Ratenkredit terms for 2026.

Frequently asked questions

Up to what income do I pay no income tax in Austria in 2026?

The 2026 tax-free threshold is €13,539 per year, which is roughly €1,128 per month over twelve months or €967 with 14 monthly payments. Below that, no wage tax is owed. Social security contributions are still deducted but can be partially recovered through the negative tax refund (€496 to €804 for employees).

How much wage tax do I pay on €2,500 gross per month?

On €2,500 gross monthly (14 payments per year = €35,000 gross annually), the regular monthly wage tax is around €188 after deducting 18.12% social security and the €496 commuter allowance. Net pay is roughly €1,859 per month, plus a 13th and 14th salary of around €1,984 each. Familienbonus or Pendlerpauschale add to that.

How are the 13th and 14th salary taxed?

Special payments use a fixed schedule. The first €620 per year are tax-free, then 6% up to a special-payment base of €25,000, then 27% up to €50,000, then 35.75% up to €83,333. Social security of 17.12% is also withheld. For a typical employee, the effective tax on the 13th and 14th salary stays well below 10%.

What does the end of cold progression mean for 2026?

Since 2023 every bracket except the top one above €1,000,000 has been raised automatically by two thirds of the measured inflation rate. For 2026 this comes to 1.7333% (two thirds of 2.6% inflation from July 2024 to June 2025). The tax-free threshold has therefore moved from €13,308 to €13,539. 2026 is the third and final automatic step.

When is filing a tax return worth it?

Almost always. Anyone claiming income-related expenses, special expenses, extraordinary burdens, the commuter allowance or the Familienbonus gets money back. Filing is also smart after a job change, parental leave or any year with uneven income. The deadline is up to five years retroactively via FinanzOnline. Details in our tax return guide.

What is the top tax rate in Austria 2026?

The regular top rate is 50% on income above €104,859 per year. A separate 55% bracket applies to income above €1,000,000 — this top step is statutorily time-limited and, unlike the others, is not adjusted for inflation.

What is the difference between Lohnsteuer and Einkommensteuer?

Lohnsteuer is wage tax, withheld by the employer directly from salaries. Einkommensteuer is the umbrella term — income tax — covering all seven categories of income under § 2 EStG, including self-employment, business income, rental and capital income. The brackets are identical; only the collection method differs.

Summary: Austria's 2026 income tax in one paragraph

The 2026 adjustment of 1.7333 percent is the smallest since reform began — and the last automatic one. Anyone earning the same gross salary as in 2025 keeps slightly more after tax. For most employees, the bigger lever is not the bracket itself but the annual tax return: Familienbonus, Pendlerpauschale, work-related expenses and special deductions are routinely under-claimed. Bracket data here is taken directly from the BMF inflation adjustment ordinance for 2026; complex cases such as multiple employers, large special-payment shares or foreign income deserve a chat with a Steuerberater or the Chamber of Labour.

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Last updated: April 2026. Sources: BMF, WKO, USP.gv.at, Chamber of Labour. All figures without warranty.