Austria enacts 2025 tax amendments, amends Pillar 2 rules

Austria’s Tax Amendment Act 2025  introduces significant changes to individual income tax and the global minimum tax (Pillar 2). 

Austria has gazetted the Tax Amendment Act 2025 on 23 December 2025, introducing significant changes to the Austrian tax landscape, particularly regarding individual income tax and the global minimum tax (Pillar 2).

Pillar 2 updates

The updates to the Minimum Taxation Act reflect the ongoing implementation of EU directives (2022/2523 and 2025/872) to ensure a global minimum tax level for large corporate groups.

Austria has revised its Pillar 2 global minimum tax rules to reflect the latest OECD guidance from 2023 to 2025. The updates provide clearer definitions and treatment of transparent, hybrid, and reverse hybrid entities, simplify the handling of deferred taxes, adjust certain safe harbours, including the CbC safe harbour, streamline calculations for non-essential business units, and update the allocation of CFC taxes in mixed CFC regimes.

The amendments also include the implementation of Council Directive (EU) 2025/872 of 14 April 2025 (DAC9) concerning the exchange of top-up tax information returns, and the adoption of rules for information exchange under the Multilateral Competent Authority Agreement on GloBE Information (GIR MCAA).

By 1 December 2026, Austria will begin the automatic exchange of information regarding these minimum tax reports with other EU member states and signatory jurisdictions. This ensures that “secret” tax havens are effectively eliminated, as every major economy will have the tools to verify that the global “floor” of taxation is being respected.

Personal income tax brackets increase

The Act increases the individual income tax brackets:

The provisions of the Tax Amendment Act 2025 generally take effect from January 2026, while the updates to the Pillar 2 rules apply to financial years starting on or after 31 December 2023.