Tax reliefs for families

The Austrian Income Tax Act (EStG) contains numerous tax benefits for families, with eligibility potentially dependent on the level of income. The current reliefs (as of 2025) and how to apply are discussed in the following blog post. 

The primary requirement for claiming tax reliefs is the presence of a child for whom there is a claim for the children payment deduction (Kinderabsetzbetrag) (and family allowance (Familienbeihilfe)) or the maintenance payment deduction (Unterhaltsabsetzbetrag) lasting more than six months.  

While the children payment deduction is already paid alongside the monthly family allowance, the maintenance payment deduction can only be claimed retrospectively through the annual tax return. This deduction is available for children who do not live in the same household but for whom statutory maintenance payments are demonstrably made.  

• Family Bonus Plus 

The Family Bonus Plus (“FABO+”) is a tax payment deduction and directly reduces the tax burden (to maximum zero). The FABO+ can only be claimed once per child for both parents, but it is possible to split the amount between the parents (50%/50%). The claim can be made either continuously through the monthly payroll or retrospectively through the tax return.  

Important note: Whether the FABO+ is claimed through payroll or later via the tax return, the forms L1k and L1k-bf must be completed in the tax return. Failure to complete these forms will result in a subsequent tax payment obligation! 

The FABO+ is also available if the child lives abroad, provided that statutory maintenance payments are demonstrably made for the child. 

• Employer contribution for childcare 

The employer can pay parents a wage tax and social security-free contribution for childcare, provided all conditions are met. The contribution can be paid directly to the caregiver or childcare facility or reimbursed to the parents as a cost refund. There is no legal entitlement to the employer contribution for childcare. We are happy to assist employers with any questions on this matter. 

Tax benefits for low income families 

• Additional child allowance (Kindermehrbetrag) 

If the FABO+ cannot be claimed to reduce taxes by either parent due to insufficient income, the additional child allowance offers compensation, provided there is a claim for the sole earner or single parent deduction. If both parents are eligible to apply, the additional child allowance must be claimed by the recipient of the family allowance. The claim must be made retrospectively through the tax return. 

• Multiple-child supplement (Mehrkindzuschlag) 

The multiple-child supplement is granted from the third child onwards if the annual income of both parents does not exceed EUR 55,000. The supplement is to be requested via the tax return.  

• Sole earner / Single parent deduction (Alleinverdiener- /Alleinerzieherabsetzbetrag) 

The sole earner deduction is available if the taxpayer lives in a marriage or similar partnership for more than six months in the calendar year and the partner earns no more than EUR 7,284 in the calendar year. The single parent deduction is also available if the taxpayer does not live in a marriage or similar partnership but fulfils the conditions as a partner. The claim can be made continuously through the monthly payroll or retrospectively through the tax return. 

Important note: If the sole earner deduction is claimed in the tax return, although the annual income is exceeded, the tax authority checks the claim and denies it, where appropriate, or a wrongly granted sole earner deduction is reclaimed by the tax authority via notice. 

Do you have any further questions regarding tax benefits for families? Our P&O team of PwC Austria is looking forward to support you.