Since the start of the COVID 19 pandemic in 2020, working from home has become an integral part of many Austrians’ everyday work lives. As a result, the Austrian legislature addressed the regulation of home office work for the first time in 2021, introducing highly restrictive regulations. Three years later, not only working from home but teleworking in general has become firmly established as a working model in Austria. The amendment of the Austrian provisions now takes this development into account.
The new regulations under the Austrian Telework Act entered into force on 1 January 2025 and bring both opportunities and challenges for local and international employers.
Work in the home office was deemed to exist until the end of 2024, if an employee regularly performed work at home. In addition to the employee's private residence, this also included the home of a close relative or partner. However, by changing the term “home office” to “telework,” office premises rented by the employee (so-called coworking spaces) or other locations chosen by the employee (such as internet cafés) are now also considered for telework under the regulations. (former “home office”).
From a tax perspective, a lump sum of EUR 3 per day for a maximum of 100 home office days could be granted as home office allowance starting from 2021. Only those days on which the employee worked exclusively from home counted as home office days for purposes of this allowance.
The allowance has recently been extended during the change from home office to telework. The change applies to all taxable employment relationships, whereas the allowance remains at EUR 3.00 per telework day, for a maximum of 100 days per year.
To benefit from the teleworking allowance, the teleworking days must be reported to the tax authorities. To ensure proper documentation, employers are legally required to document, and report telework days and any telework allowance granted on the annual payslip filed with the tax authorities (L16). Failure to report telework days results in the loss of the teleworking allowance.
There are two options to benefit from the teleworking allowance: The allowance can either be granted tax-free by the employer and paid out with the regular payroll cycles, or the employee can deduct the respective amount as “income-related expenses” in the employee’s personal income tax return.
Additionally, if an employee has worked at least 26 teleworking days in a year and has reported these days to the tax authorities, the employee can also claim expenses for ergonomic furniture bought for the teleworking workspace, up to EUR 300 per fiscal year.
Accident insurance coverage has been extended to include accidents that occur during telework in general, with the condition that these accidents must be related to the individual's employment. There is a differentiation between "telework in the narrow sense" (e.g., home office or coworking spaces) and "telework in the broader sense" (e.g., parks or cafes). Commuting accidents to and from work locations in the narrow sense are covered, while those in the broader sense are considered personal interests and are not covered by the (mandatory) accident insurance.
Although the extension of the home office regulations to telework opens possibilities, foreign employers who employ remote workers in Austria may face restrictive regulations regarding the creation of a permanent establishment (PE) in Austria. It is therefore highly recommended to have the PE risk reviewed based on the activity performed by the employee in Austria right from the beginning.
Katja Reichl
Denise Berzsenyi
BDO in Austria
The new regulations under the Austrian Telework Act entered into force on 1 January 2025 and bring both opportunities and challenges for local and international employers.
Change from “Home Office” to “Telework”
Work in the home office was deemed to exist until the end of 2024, if an employee regularly performed work at home. In addition to the employee's private residence, this also included the home of a close relative or partner. However, by changing the term “home office” to “telework,” office premises rented by the employee (so-called coworking spaces) or other locations chosen by the employee (such as internet cafés) are now also considered for telework under the regulations. (former “home office”).
Tax Law Amendments
From a tax perspective, a lump sum of EUR 3 per day for a maximum of 100 home office days could be granted as home office allowance starting from 2021. Only those days on which the employee worked exclusively from home counted as home office days for purposes of this allowance.The allowance has recently been extended during the change from home office to telework. The change applies to all taxable employment relationships, whereas the allowance remains at EUR 3.00 per telework day, for a maximum of 100 days per year.
To benefit from the teleworking allowance, the teleworking days must be reported to the tax authorities. To ensure proper documentation, employers are legally required to document, and report telework days and any telework allowance granted on the annual payslip filed with the tax authorities (L16). Failure to report telework days results in the loss of the teleworking allowance.
There are two options to benefit from the teleworking allowance: The allowance can either be granted tax-free by the employer and paid out with the regular payroll cycles, or the employee can deduct the respective amount as “income-related expenses” in the employee’s personal income tax return.
Additionally, if an employee has worked at least 26 teleworking days in a year and has reported these days to the tax authorities, the employee can also claim expenses for ergonomic furniture bought for the teleworking workspace, up to EUR 300 per fiscal year.
Accident Insurance Coverage
Accident insurance coverage has been extended to include accidents that occur during telework in general, with the condition that these accidents must be related to the individual's employment. There is a differentiation between "telework in the narrow sense" (e.g., home office or coworking spaces) and "telework in the broader sense" (e.g., parks or cafes). Commuting accidents to and from work locations in the narrow sense are covered, while those in the broader sense are considered personal interests and are not covered by the (mandatory) accident insurance.
Permanent establishment risk associated with remote workers
Although the extension of the home office regulations to telework opens possibilities, foreign employers who employ remote workers in Austria may face restrictive regulations regarding the creation of a permanent establishment (PE) in Austria. It is therefore highly recommended to have the PE risk reviewed based on the activity performed by the employee in Austria right from the beginning.Katja Reichl
Denise Berzsenyi
BDO in Austria