Of key concern to Slovak residents buying real estate in Austria is whether they will continue to be able to enjoy Slovakia’s favorable 19% income tax rate when they actually live in Austria.
The answer, according to Tax Bureau spokesperson Iveta Adamíková, is that they can. “Income from Slovakia is taxed in Slovakia,” she said.
When it comes to income received from other countries, the situation is slightly more complicated, because it involves deciding where the person lives, for tax purposes – where they are “tax-resident”. Tax advisor Dagmar Bednáriková said that the criteria used to decide tax residence include first of all one’s permanent residence. If, however, one has permanent residence in both Slovakia and Austria, then a person is considered to be the tax resident of that country where they have “the center of their life interests”, in other words the place where they have more family and economic ties.
Other criteria that can be used are the place where the person spends most time, as well as where they have citizenship. “There are a lot of factors that decide how global income is taxed, so it’s very difficult to generalize,” said Adamíková.
In principle, however, if you have a Slovak income, you pay Slovak taxes, no matter if you actually live in Austria.