Income from independent personal services
Income from dependent personal services
Government services
Pensions
Alimonies
I receive payment from independent personal services. In which Contracting State do I have to pay taxes?
n general, the right to taxation lies with a person’s State of Residency. According to Article 14, income from independent personal services rendered by a resident of Austria in the US, are subject to taxation in the US, only if they are connected to a permanent establishment (fixed place of business; e.g., garage, office, or similar) in the US. In this case, all income connected with the permanent establishment in the US is subject to taxation in the US. This income is also subject to taxation in Austria, but US taxes are deducted from Austrian taxes to avoid double taxation.
I receive payment from dependent personal services. In which Contracting State do I have to pay taxes?
Exception: As an exception, the right to taxation only lies with the Contracting State of residence under certain conditions:
- The natural person does not stay any longer than 183 days (within a 12-month period) in the other Contracting State (where the service is rendered), and
- the remuneration is paid by, or on behalf of, an employer not a resident of the Contracting State in which the service is rendered, and
- the payment is not derived from a place of business or permanent establishment of the employer in the other Contracting State (in which the service is rendered).
Where do I have to pay taxes for my income from public services?
According to Article 19 of the Convention, the basic rule concerning wages, salaries, and similar remuneration paid from a Contracting State to an individual is that they are subject to taxation only in this Contracting State. This also means that income and pensions from public funds are taxable in the Contracting State in which the public fund is based.
I am an Austrian citizen and receive my pension from Austria/ the US. Where do I have to pay taxes?
According to Article 19 of the Convention, pensions from public funds are taxable in the Contracting State in which the public fund is based. Pensions that do not fall into a category of Article 19 of the Convention (see Chapter 4.3) are taxable only in the Contracting State in which the benefiting person resides. Exemptions to this rule are payments from the national insurance institutions and other public pensions, which are only taxable in the Contracting State from which the payment is received. Further information for retirees living abroad, as well as the fiscal treatment of pensions, is provided by the Austrian National Pension Administration (Pensionsversicherungsanstalt, PVA) as download.
Annuities: Annuities are defined as stated sums of money paid periodically at stated times over a certain number of years in return for adequate and full consideration (other than services rendered). Like pensions, annuities are taxable only in the Contracting State in which the taxpayer resides.
Payments into public pension funds: According to Article 18, the Convention regulates those cases of payments into public pension funds in which a resident of Contracting State A makes payments into a public pension fund in Contracting State B. Concerning taxation, these payments are to be handled by Contracting State A in the same way as if they were rendered to a pension fund in Contracting State A. The rule applies if, and only if, the individual was not a resident of that State, and was contributing to the pension scheme immediately before he/she began to exercise employment in that State; and if the pension scheme is accepted by the competent authority of that State as generally corresponding to a pension scheme recognized as such for tax purposes by that State.
In which country do I have to pay taxes for the alimonies I pay/receive?
Alimonies, like pensions, are regulated in Article 18 of the Conventions. They are defined as periodic payments made pursuant to a written separation agreement or a decree of divorce, separate maintenance, or compulsory support. Alimonies are taxable in the Contracting State in which the person responsible for support resides. Periodic payments to support a minor child are generally exempt from taxation in both Contracting States.
Relevant Links:
Austrian National Pension Administration (PVA, in German): http://www.pensionsversicherungsanstalt.at
Further information for retirees living abroad, as well as fiscal treatment of pensions (in German):
http://www.pensionsversicherung.at/mediaDB/Information%20Englisch.pdf
