Wage tax in Austria: brackets, table and the payroll method
How the annual scale of the Income Tax Act becomes the wage tax line on your monthly payslip, and why your top rate is not what you actually pay.
Austrian wage tax (Lohnsteuer, the income tax your employer withholds) follows the scale in section 33 of the Income Tax Act. In 2026 annual income up to €13,539 is tax-free, the next slice is taxed at 20 %, income above €21,992 at 30 %, above €36,458 at 40 %, above €70,365 at 48 %, above €104,859 at 50 % and above one million at 55 %. The brackets rose by 1.73 % for 2026. On the payslip (Lohnzettel), payroll takes your regular monthly pay after social insurance, multiplies by twelve, deducts a flat €132 for work expenses, applies the scale, subtracts tax credits such as the €496 transport credit and divides by twelve. On €3,000 gross that gives €283.82 a month; on €5,000 it is €880.13. Below roughly €1,585 gross no wage tax is due. Your marginal rate is what the next euro costs; the real burden is far lower, about 17.6 % of gross pay at €5,000.
Wage tax and marginal rate on your salary
Wage tax per month
€406.72
| Annual taxable base | €34,279 |
| Marginal rate | 30 % |
| Average of gross | 11.6 % |
| Transport credit per year | €496 |
Checked by Radif Partners · Editorial policy · Calculation method
The 2026 brackets
Austria taxes employment income on a stepped scale. What counts is annual income after social insurance, work expenses and other allowances. Each bracket has its own rate, applied only to the slice of income inside it (section 33(1) of the Income Tax Act). There are no tax classes as in Germany and no church tax on the payslip: everyone with the same pay and the same credits pays the same wage tax.
| Annual income 2026 | Rate on this slice | Upper limit in 2027 |
|---|---|---|
| up to €13,539 | 0.0 % | €13,846 |
| €13,539 to €21,992 | 20.0 % | €22,491 |
| €21,992 to €36,458 | 30.0 % | €37,285 |
| €36,458 to €70,365 | 40.0 % | €71,960 |
| €70,365 to €104,859 | 48.0 % | €107,236 |
| €104,859 to €1,000,000 | 50.0 % | unchanged |
| above €1,000,000 | 55.0 % | until 2029 |
Each 2026 limit is 1.73 % above its 2025 value. The Finance Ministry announced this inflation adjustment, which also lifts the main tax credits, on 30 December 2025 (ministry press release). Austria indexes its brackets every year to offset “cold progression”, the creep into higher bands caused by pay rises that only match inflation. The 2027 figures are already in the law, so if you are negotiating a contract that starts in January you can plan with a zero bracket of €13,846. This site keeps calculating with 2026 values until the year ends.
How payroll gets from your salary to the wage tax line
The scale is annual, but you are paid monthly. Austrian payroll solves this by annualising: it takes the regular monthly pay, multiplies it by twelve, applies the scale and divides the result by twelve again. The official calculator of the Finance Ministry uses the same method. Worked through for €3,000 gross a month, outside Vienna, no children, no commuter allowance:
- Gross pay €3,000.00 less social insurance €542.10 leaves €2,457.90 taxable per month.
- Times twelve, less the €132 flat work-expense allowance (Werbungskostenpauschale): taxable base €29,362.80 a year.
- Scale applied: €3,901.84 income tax a year.
- Less the transport credit (Verkehrsabsetzbetrag) of €496; child credits or the commuter euro would come off here too.
- Divided by twelve: €283.82 wage tax per month.
The flat work-expense amount is automatic, no application needed. Tax credits reduce the tax itself rather than the base, so the €496 transport credit is worth €41.33 a month at any salary level, provided there is that much tax to absorb it. You will find the details on the pages about the transport credit, Familienbonus Plus and the sole earner credit.
Wage tax table 2026 by monthly gross
| Monthly gross | Social insurance | Wage tax | Marginal rate | Wage tax as % of gross | Regular net |
|---|---|---|---|---|---|
| €1,500 | €226.80 | €0.00 | 20.0 % | 0.0 % | €1,273.20 |
| €2,000 | €302.40 | €70.34 | 20.0 % | 3.5 % | €1,627.26 |
| €2,500 | €428.00 | €168.05 | 30.0 % | 6.7 % | €1,903.95 |
| €3,000 | €542.10 | €283.82 | 30.0 % | 9.5 % | €2,174.08 |
| €3,500 | €632.45 | €406.72 | 30.0 % | 11.6 % | €2,460.83 |
| €4,000 | €722.80 | €552.41 | 40.0 % | 13.8 % | €2,724.79 |
| €5,000 | €903.50 | €880.13 | 40.0 % | 17.6 % | €3,216.37 |
| €6,000 | €1,084.20 | €1,207.85 | 40.0 % | 20.1 % | €3,707.95 |
| €7,000 | €1,252.25 | €1,540.63 | 40.0 % | 22.0 % | €4,207.12 |
| €9,000 | €1,252.25 | €2,490.47 | 48.0 % | 27.7 % | €5,257.28 |
This is the tax on an ordinary month. In June and November, when holiday pay and Christmas pay arrive, your payslip shows an extra line for the special payment with its own fixed rate, while the regular wage tax stays the same. From €6,930 gross, social insurance stops growing because of the contribution ceiling, which is why wage tax climbs faster at the top of the table.
Wage tax and marginal rate on your salary
Wage tax per month
€406.72
| Annual taxable base | €34,279 |
| Marginal rate | 30 % |
| Average of gross | 11.6 % |
| Transport credit per year | €496 |
Marginal rate versus average rate
Your marginal rate is the rate of the bracket your last euro falls into. It tells you how much tax a pay rise, an overtime hour or a bonus taxed on the scale will cost. Your average rate is total wage tax divided by income, the share of your whole salary that goes to the tax office.
At €5,000 gross the annual taxable base is €49,026, inside the 40.0 % band. Of €100 extra gross, wage tax alone takes €32.78, because social insurance comes off first. Yet wage tax on the whole monthly salary is only 17.6 % of gross. Add the favourably taxed 13th and 14th salaries and the share falls further: €70,000 of annual gross leaves €46,429 net.
Many newcomers fear that crossing into a higher bracket can leave them with less money. Under the scale that is impossible, since the higher rate only touches the part above the limit. The only real cliffs in Austrian payroll are in social insurance, at the steps of the reduced unemployment contribution; see social insurance contributions.
When the employer's figure is not your final tax
Annualising assumes a full year at the same salary. If you move to Austria and start work in September, payroll taxes you from day one as if you earned that salary for twelve months, although your real annual income is much lower. If you hold two jobs at once, each employer grants the transport credit and the lower brackets, and the tax office collects the difference later. Either way, the employee tax assessment settles the year. The annual payslip that summarises your wage tax is explained under Lohnzettel.