Austria MOF Clarifies Taxation, Employer Contributions, Surcharges for Managing Director Salary

The Austrian Federal Ministry of Finance May 28 posted online Federal Finance Court Decision No. RV/7100235/2020, clarifying the taxation of a managing director salary, and the application of employer contributions and surcharges. The taxpayer, a company, credited a salary to its sole shareholder-managing director, but didn’t actually pay any amount. The Tax Office treated the salary as taxable and assessed additional employer contributions and surcharges. On appeal, the Federal Finance Court found that: 1) the taxpayer wasn’t insolvent because it continued to meet its obligations, had access to credit facilities, and showed no evidence of permanent inability to pay; 2) ...