EStG Amendment Published: Overtime Premiums and Holiday Work Compensation
It is done: the long announced amendment to the Austrian Income Tax Act (EStG) was published in the Federal Law Gazette on 18 February 2026 (Federal Law Gazette I No. 4/2026). This means that the following tax law adjustments have now officially entered into force retroactively:
- Tax‑exemption of overtime premiums (§ 68 (2) EStG) in the calendar year 2026 for up to 15 overtime hours (premium 50%) and a maximum of EUR 170.00 per month (§ 124b no. 440 EStG).
- Holiday work compensation (which has been taxable since 1 January 2025 following a Federal Fiscal Court decision) is once again tax‑exempt under § 68 (1) EStG (explicit insertion of the term “holiday work compensation” into the text of § 68 (1) EStG).
Link tip: You can access the original text of the EStG amendment in the Federal Law Gazette here: https://www.ris.bka.gv.at/Dokumente/BgblAuth/BGBLA_2026_I_4/BGBLA_2026_I_4.html |
The amendment applies retroactively as of 1 January 2026. This also gives “the green light” to those software providers who wished to wait for the final enactment before releasing the corresponding program update. If the new rules have not already been taken into account, employers are required to perform a retroactive payroll correction (Aufrollung) by 31 May 2026 at the latest.