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Tax shock for waiters and nurses: holiday work now expensive!
From 2025, employees in Austria will have to pay taxes on holiday wages. Critics see this as a hidden tax increase.
Tax shock for waiters and nurses: holiday work now expensive!
From January 1, 2025, employees in certain professions, such as waiters, nursing staff and tourism workers, will have to pay taxes on their holiday wages for the first time. This regulation, which partially applies retroactively, comes as a surprise to many employees as they have only now been informed about the changes by their employers. The taxation of holiday work goes back to a ruling by the Federal Finance Court that was made in December 2024. Until the end of 2024, holiday wages were tax-free as long as no additional bonus was paid, which will now fundamentally change. According to oe24, the Ministry of Finance adopted this new regulation in April 2024.
If work is carried out on public holidays without extra pay and this counts as regular working hours, employees must pay taxes. For some employees, this can amount to up to 130 euros per month. An exception is those staff who receive a special holiday allowance, as this group is not affected by the new tax regulations.
Background and legal basis
The decision of the Federal Finance Court, which was published on December 19, 2024 under the file number RV/3100544/2017, clarified that holiday pay is considered taxable wages. However, employees retain their right to remuneration for work missed on public holidays, unless compensation for time off is agreed. This also applies to work carried out during the holiday break, as explained in wko. The bonus for holiday work is only tax-free if the payments expressly indicate this and were paid for holiday work actually performed.
The Federal Ministry of Finance's response to the query confirmed the BFG's view. It is emphasized that holiday pay according to Section 9 Paragraph 5 ARG is not viewed as a supplement within the meaning of Section 68 Paragraph 1 EStG 1988. The preferential treatment still applied until December 31, 2024, but from calendar year 2025 the new regulation will be applied, which may require a review of the first three months of the year, such as this [BMF].
Criticism of the new regulation
Critics of the new tax regulation describe it as a hidden tax increase that particularly affects employees in the affected sectors. While the official statement from the Ministry of Finance aims to provide “clarity,” it remains to be seen how employees will perceive the transition to the new taxation.