Austria MOF Clarifies Input Tax Deductions for Long-Term Renovation Expenses

The Austrian Federal Ministry of Finance April 30 posted online Federal Finance Court Decision No. RV/5100117/2023, clarifying input VAT deductions for long-term renovation expenses. The taxpayer claimed input VAT deductions on renovation work, debt financing costs, advertising costs, and depreciation related to a property intended for rental. The Tax Agency denied the deductions. The taxpayer argued that the expenses should be considered preparatory actions for generating rental income, entitling him to input tax deductions. On appeal, the Federal Finance Court held that: 1) the serious intention to generate income from renting must be proven through binding agreements or other circumstances ...