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Tax-News | Business-News

Investment allowance from January 1st, 2023

In the course of the eco-social tax reform, the investment allowance (IFB) is being reborn after more than 20 years, with which corporate investments will be tax-deductible from 2023. For depreciable fixed assets purchased or manufactured after December 31, 2022, an investment allowance of 10% or 15% in the area of ​​greening can be claimed for the first time in 2023, subject to certain regulations, as an additional tax operating expense. We have summarized for you what needs to be taken into account.

Requirements:

  • An investment allowance can only be claimed for assets that have a customary useful life of at least four years and are attributable to domestic businesses or domestic business premises if the business or business premises serve to generate business income.
  • The investment allowance can be claimed for a maximum of acquisition or production costs of EUR 1.000.000 in the fiscal year (allocation for short fiscal years).
  • The deduction for wear and tear (AfA) is not affected by the investment allowance.
  • If the profit is determined by means of a flat rate (according to § 17 EStG or a corresponding regulation), the investment allowance is not applicable.

The following are excluded from the investment allowance:

  • Assets that are used to cover an investment-related profit allowance.
  • Economic goods for which a special form of deduction for wear and tear is expressly provided for in Section 8 of the EStG, with the exception of electric vehicles.
  • Low-value assets that are sold immediately.
  • Intangible assets that cannot be assigned to the areas of digitization, greening or health/life science.
  • Used economic goods (also e-demonstration vehicles!)
  • Certain installations that are used to extract, transport or store fossil fuels, as well as installations that use fossil fuels directly. The decisive criteria for the assessment are to be specified in more detail by regulation (currently not yet available)

The investment allowance can only be claimed in the year of acquisition or manufacture. If the acquisition or production extends over more than one financial year, the investment allowance can already be claimed from capitalized partial amounts. For partial amounts already activated in 2022, the investment allowance can still be claimed if the acquisition/manufacturing process is completed after December 31, 2022.

Claiming the investment allowance:

The investment allowance must be shown in the tax return or declaration of assessment in the space provided for this purpose. In the case of assets for which the investment allowance is claimed, the IFB must be shown in the list of assets.

December 16, 2022 | LBG

Contact & Advice: This information naturally shows basic aspects of the topic - for completeness and correctness no guarantee can be given despite careful preparation. LBG will gladly advise you in your individual situation. Please contact one of our 32 Austria-wide locations (www.lbg.at) or welcome@lbg.at - we will gladly bring you together with one of our experts who is very familiar with your request.