Reintroduction of Inheritance Tax in Austria 2025
In 2008, inheritance tax was abolished in Austria. However, the risk of a reintroduction of inheritance tax in Austria in 2025 is higher than it has been for a long time. You can find out how to protect your assets and inheritance here at Harlander & Partner.
Tax Revenues are No Longer Sufficient
Austria is in the red. The state and our healthcare system cost more money than is collected through taxes. Therefore, many are calling for new taxes.
Companies and labor are already taxed higher in Austria than in almost all countries worldwide. A further increase in taxes on companies and employees is unthinkable. The state would therefore have to save rigorously – a virtue that our governments have never mastered.
Instead, calls for taxing inheritances and gifts are growing louder. Those who have saved something should no longer be allowed to pass it on to their loved ones without deductions.
Peter HarlanderHarlander & Partner Rechtsanwälte „Neue Steuern kommen in der Regel sehr kurzfristig. Daher übergeben jetzt immer mehr Menschen jetzt Vermögensteile an ihre Erben, um das Risiko einer neuen Erbschaftssteuer zu minimieren.“
Options for Avoiding a New Inheritance Tax
This is how you can avoid a new inheritance tax:
Deed of Gift
One option would be to gift a part of your assets to the future heirs this year.
In a gift, the donor transfers an item to the donee free of charge, i.e., without receiving any consideration for it. Anything can be gifted: money, furnishings, apartments, real estate, shares, and much more.
If the subject of the gift is not transferred immediately, the deed of gift must be drawn up as a notarial act. (However, this makes little sense for protection against an impending tax – the transfer should take place now.) For the same reason, a gift upon death also makes no sense.
A gift is ideal if the donor is no longer dependent on the subject of the gift.
Select Your Preferred Appointment Now:Free initial consultationTransfer Agreement
A transfer to the future heirs would be a second option that often fits better.
In a transfer agreement, assets are transferred from the transferor to the transferee during the transferor’s lifetime. The principle also applies here: in principle, any asset can be the subject of a transfer agreement.
Note: However, unlike a gift, the transfer agreement provides for consideration from the transferee.
Common considerations in transfer agreements are:
- Right of Residence
- Usufruct
- Annuity Payments
- Equalization Payments to Unconsidered Siblings
- Care and support services if the transferor needs them
- Support payments in the event of a financial emergency of the transferor
Thus, with a transfer agreement, for example, parents can transfer a part of their assets to their children during their lifetime and at the same time secure themselves or other children.
Transfer agreements are therefore particularly frequently concluded in the context of corporate succession and the transfer of real estate. However, the transfer of valuable brands, patents, designs, licenses, works of art or other valuables is also conceivable.
Select Your Preferred Appointment Now:Free initial consultationEnduring Power of Attorney
Hardly anyone would think of an enduring power of attorney when avoiding the inheritance tax risk. Nevertheless, an enduring power of attorney can be a good solution for all those who do not wish to transfer their assets yet, but still desire more security.
In an enduring power of attorney, you designate an authorized person who may make decisions for you in the event of loss of legal capacity, insight and judgment, or ability to communicate.
It can also be stipulated that the authorized person may transfer assets to themselves. For self-protection, it can be stipulated in this case that the authorized person then, for example, has to pay for the nursing home.
The enduring power of attorney is thus the weakest protection against the risk of an inheritance tax. If it is introduced too quickly, the time for asset transfer may be too short.
Peter HarlanderHarlander & Partner Rechtsanwälte „Nutzen Sie unser kostenloses Erstgespräch, um mehr zu den Möglichkeiten der Absicherung gegen eine neue Erbschaftssteuer zu erfahren.“
