Austria MOF Clarifies Tax Treatment of Losses From Small Residential Rental Properties

The Austrian Federal Ministry of Finance May 14 posted Federal Finance Court Decision No. RV/3100028/2024, clarifying the tax treatment of losses from small residential rental properties. The taxpayer, an individual, purchased a residential property and rented it out. The property suffered water and other damage, and the taxpayer renovated the property. The taxpayer suffered losses when the rental income declined and eventually sold the property. The Tax Office classified the rental activity as a hobby in assessing VAT and income tax, and denied input VAT deductions. The taxpayer appealed. On appeal, the Federal Finance Court found that: 1) the taxpayer ...