Austria MOF Clarifies Taxation of Small Rental Home Apartments

The Austrian Federal Ministry of Finance Nov. 20 posted online Federal Finance Court Decision No. GZ. RV/5100382/2023, clarifying tax on renting small home apartments. The taxpayer purchased a single-family house, modified it, and rented out apartments. Following an audit, the Tax Office found that the rental activity didn’t generate a profit and classified it as a hobby, thus disallowing input tax deductions, and assessed additional income tax and sales tax based on this classification. The taxpayer contended that their rental activity was a legitimate business, asserting that the original cost of the bonds should be included in loss calculations and ...