Austria MOF Clarifies Input VAT Deductions for Rental Properties

The Austrian Federal Ministry of Finance Feb. 6 posted online Federal Finance Court Decision No. RV/2100896/2019, clarifying input VAT deductions on rental properties. The taxpayer, a domestic company, purchased various rental properties and took over the existing leases. The Tax Office found that the tenant’s activity was VAT-exempt banking transactions and denied input VAT deductions. On appeal, the Federal Finance Court found in part that: 1) Section 6 of the VAT Act, as amended, doesn’t apply to the taxpayer’s rental income since the lease began after August 31, 2012; 2) the vacant spaces and attics weren’t considered part of the ...