Study stay in Austria while being self-employed in Germany.
July 7, 2012 | 25,00 EUR | answered by Wirtschaftsprüfer André Hintz
Dear Sir or Madam,
As I am currently in Austria this year for the purpose of studying, but also managing my German self-employment (in the IT sector) from here, primarily serving companies in third countries, there are some questions regarding taxation.
Where and in which country is the company, due to my changed place of residence (secondary residence registered in Austria for me and residence for the core hours of a normal Bachelor's degree/full-time study), subject to taxation and where do I need to pay my income taxes?
Ideally, I would like to continue to operate everything through Germany, but I am not quite sure if this is possible. Are there any experiences in this regard?
Another point is the value added tax. Currently, I have some business-related small expenses (such as fuel receipts, etc.) with Austrian VAT. What is the optimal way to proceed here? Can I deduct the VAT retrospectively?
Best regards,
Dear inquirer,
I would like to answer your question within the framework of an initial consultation and based on your fee contribution, in accordance with the rules of the online portal. My response is based on the situation you have presented.
When it comes to taxing your income, a distinction must be made between income tax law and value added tax law.
In terms of income tax, your income from self-employment or commercial activities is subject to taxation in Austria. This is because you reside there and operate your business from there.
If you change your residence within the year, you must be aware that you will have to file tax returns in both countries.
In terms of value added tax, you will also be based in Austria and therefore must adhere to Austrian law, which is nearly identical to German value added tax law due to EU directives.
If you provide services to other businesses, the taxation of those services typically depends on the location where your business client operates. For private clients, it depends on your location. If you operate your business in Austria, you can also claim input tax deduction there, starting from the moment you operate your business and have a proper invoice.
Further advice on tax law in Austria must be provided by a tax advisor from Austria, as this is not permitted for German tax advisors.
I hope my explanations have been helpful to you and remain
Sincerely yours,
André Hintz
Tax Advisor
