Austria Payroll Changes - 2026

• Collective agreement

A new collective agreement is expected to apply from January 1, 2026. While it is still under negotiation, employers should prepare for mandatory salary adjustments once it is published.

• Employees without current overpayment must be adjusted to the new minimum salaries.
• The IT agreement typically includes IST-Erhöhung:
  • Applies to employees already earning above the minimum salary.
  • Must be applied no later than July 1, 2026.
  • Details and exceptions will be provided in the official collective agreement.
  • Terms may adjust year-to-year.

• Social security contribution

Changes to contribution caps and rates will affect both employers and employees from January 1, 2026, with additional Vienna-specific increases pending official confirmation.

• Maximum contribution base: €6,930/month
• Maximum contribution base for special payments: €13,860/year
• Vienna-specific change:
  • Employer + employee rate increases by 0.25%
  • Employee contribution rises to 18.32% from January 1, 2026
  • Further details pending publication.

• Marginal employment

The marginal employment threshold remains unchanged for 2026, increasing the risk that regular salary adjustments may push employees into full social insurance coverage.

• Threshold remains €551.10/month (holiday & Christmas bonuses excluded).
• Since the threshold is not increasing, salary adjustments may push employees above the limit, triggering:
  • Full social insurance contributions
  • Loss of marginal-status eligibility
• If earnings exceed €551.10 in any month, full insurance applies immediately.
• Marginal work while receiving AMS benefits is allowed only in exceptional cases from January 2026; otherwise, employment must end by January 31, 2026, to retain unemployment benefits.
• Employers must report marginal employment to AMS and register employees accordingly.
• From 2026, weekly working hours must be recorded for marginal workers.

• Other key updates

Several payroll and compliance rules will change in 2026, impacting overtime taxation, meal allowances, and working-time coverage checks.

• Only 10 overtime hours per month can be paid tax-free (max €120).
• Meal allowances must be itemised in payroll records starting in 2026.
• Coverage check (Deckungsprüfung) required for employees with all-in contracts or overtime allowances:
  • Verify actual hours worked vs. hours covered by the contract.
  • Excess hours must be paid out.