Why foreign brokers do not withhold Austrian KESt (Austrian withholding tax on capital income) – and what investors need to do now.
Who withholds the 27.5 % KESt?
Securities account with a bank in Austria
KESt is withheld automatically. 27.5 % is deducted directly – and that settles the tax in full. You need do nothing further.
Securities account with a foreign broker
No Austrian KESt. Responsibility lies entirely with you as the investor: income must be declared and taxed by you – year after year.
What must be declared
- Dividends & interest – even if they are immediately reinvested.
- Realised capital gains from the sale of shares, bonds, ETFs and other securities.
- Deemed distributed income from funds and ETFs – accumulating funds also trigger tax every year.
- Loss offsetting: manual only. Unlike with a domestic bank, it is not automatic – you must carry it out yourself in the tax return.
The declaration is made in schedule E1kv to the income tax return – every year, for as long as the account exists.
The tax authorities will find out
“Nobody will notice” is not a strategy:
- Automatic exchange of information (CRS): foreign banks and brokers report account balances, interest, dividends and sale proceeds to the Austrian authorities.
- Automatic matching: the tax administration compares these reports with tax returns – undeclared accounts stand out.
- The risk: back payments plus interest on arrears and fiscal criminal proceedings. Limitation period for evaded taxes: ten years.
The way out: voluntary disclosure (§ 29 FinStrG, Fiscal Criminal Code)
Anyone who has overlooked something so far can still put things right. Filed in good time, it grants exemption from penalties – provided three things are right:
- Timely – before the offence has been discovered or an audit has been announced.
- Complete – all tax bases must be disclosed.
- Paid – the taxes must be paid on time.
Only after an audit has been announced? Then the voluntary disclosure grants exemption from penalties only in return for a tax surcharge (Zuschlag).
How to proceed
- Obtain the documents: annual tax reports or all of the broker's account and securities statements (dividends, interest, purchases, sales, fees).
- Calculate income under Austrian rules: including acquisition costs (moving average price) and currency translation at the relevant reference date.
- File schedule E1kv on time: together with the income tax return – making use of loss-offsetting options. Deadline: 30 April (paper) or 30 June (FinanzOnline) of the following year.
- Previous years overlooked? Act quickly. Consider the option of a voluntary disclosure – the sooner, the better.
Conclusion
A foreign securities account in your portfolio? Then declare it every year. Low-cost brokers are fine – but the tax obligation shifts to you. Set it up properly and you will sleep soundly.
As at: September 2026