Transactions with foreign reference

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VAT is usually paid by the company delivering the goods or providing the service. It has to pay the VAT to the tax office. However, under the "reverse charge system" it is not the company providing the service but the company receiving the service that is liable to pay the VAT. In this case, the recipient company is responsible for paying the VAT to the tax office.

The reverse charge system may be used, for example, when a foreign company that does not operate within Austria or has no business premises there provides a service or supplies works to an Austrian company and where the service or works are taxable in Austria under the place of performance rules. The reverse charge system cannot be applied to permission to use federal highways subject to payment of a fee, to the services in connection with events or to the renting of land.

Tax liability may also be transferred in the case of certain domestic deliveries or services. Some examples are transfer of greenhouse gas emission certificates, delivery of mobile phone devices and construction works. Tax liability can be transferred in the case of construction works where the recipient themselves was contracted to perform the works or usually performs construction works themselves.

Reverse charge invoice

When the reverse charge system is applied, the recipient company will be issued an invoice by the company providing the service stating only the net amount (no tax statement) and is responsible for paying the VAT due. This can then be deducted should they be entitled to input VAT deduction. The invoice must be issued by the 15th of the calendar month following the month in which the service was provided.

When issuing an invoice under the reverse charge system, the following should be borne in mind:

• The invoice must provide information on transfer of tax liability to the recipient of the service.
• The VAT Identification (UID) Number of the company providing the service and the VAT Identification Number of the recipient should be indicated.
• The regulations on separate tax statements do not apply.

Legal bases

• Place of performance rules: section 3a paragraph 6 of the Umsatzsteuergesetz (UStG)
• Exception concerning services in connection with events: section 3a paragraph 11a of the UStG
• Invoicing rules for the Reverse Charge System: section 11 paragraph 1a of the UStG
• Transfer of tax liability for domestic deliveries or services:
  • section 19 of the UStG
  • Schrott-Umsatzsteuerverordnung
  • Umsatzsteuerbetrugsbekämpfungsverordnung

For trade within the EU, there are neither border controls nor customs clearance. The internal market measures are to be complied with for intra-Community transactions; these measures are applied in the case of cross-border deliveries and services to and from companies in other EU Member States. They regulate, among other things, the transport of goods from one member state to another member state in the context of an intra-Community distance sale, an intra-Community acquisition or an intra-Community spending.

An intra-Community delivery is a delivery between two enterprises in which goods are dispatched or transported from one EU member state to another. Deliveries of goods to enterprises within the EU are exempt from VAT under certain conditions. The acquiring company, however, makes an intra-Community acquisition which leads to acquisition taxation.

Intra-Community spending takes place when an enterprise transfers goods to the rest of the Community territory for its own use. In principle, intra-Community spending is not liable for tax within Austria; acquisition tax is, however, payable in the other EU Member State.

With regard to input taxes incurred in other member states the so-called ‘VAT refund procedure’ must be complied with. It enables Austrian entrepreneurs to make cross-border claims under certain conditions electronically using FinanzOnline for input tax due in another Member State. However, this only applies if enterprises are not required to be registered for tax purposes in the Member State in question, e.g. because the tax liability for a service provided by them transfers to the recipient of the service.

Caution

If applicable the VAT to be paid on services and deliveries to non-entrepreneurs in other EU Member States can be declared via the EU-OSS or Non-EU-OSS. In this case, businesses only need to register for VAT purposes concerning sales covered by the OSS in one EU Member State.

Further links

• FinanzOnline – Information for entrepreneurs and municipalities (→ BMF)^{German text}
• Refunding VAT (→ European Commission)
• Umsatzsteuergesetz - Annex (Internal Market) (→ RIS)^{German text}
• Institute of Certified Accountants and Tax Consultants (→ KSW )^{German text} (for information on VAT)

Sorry, this content isn't available in English yet.

Not all of our contents and services are available in English yet. We ask for your under­standing and like to assure that we are steadily working on extending our English offer.

Sorry, this content isn't available in English yet.

Not all of our contents and services are available in English yet. We ask for your under­standing and like to assure that we are steadily working on extending our English offer.

Sorry, this content isn't available in English yet.

Not all of our contents and services are available in English yet. We ask for your under­standing and like to assure that we are steadily working on extending our English offer.

Sorry, this content isn't available in English yet.

Not all of our contents and services are available in English yet. We ask for your under­standing and like to assure that we are steadily working on extending our English offer.