Tax on Selling a Business in Austria: What Is Left After Tax

In Austria the tax bill on a business sale is decided above all by the legal form: selling a GmbH share (a share in an Austrian limited company) attracts a flat 27.5 per cent on the gain, while selling a sole trader business or a partnership interest attracts the progressive income tax tariff — mitigated by an allowance, the half average tax rate or a three-year spread. Legal position of the provisions cited: 6 October 2026; half-rate outlook section: 31 October 2026.

For the sale of an Austrian limited company, our approach to selling a GmbH covers the process from valuation to the notarial deed.

The question "what is left after tax?" often does more to decide whether a sale is attractive than the purchase price itself. And the answer starts not with the tax office but with the legal form and the structure of the deal. This article sorts the cases for Austria; the detailed calculation belongs with your tax adviser in every instance.

How much tax is due on a business sale in Austria?

In Austria, the legal form largely decides the tax on a business sale: the gain from selling GmbH shares held privately is taxed at a flat 27.5 per cent (§ 27a EStG). A sole trader or partnership interest is taxed at the income tax tariff, eased by an allowance, the half-rate or spreading the gain over three years. The detailed calculation belongs with a tax adviser.

Conditions for the flat 27.5 per cent:

1. The shares are sold by a natural person out of private assets; shares held as business assets are subject to special rules (WKO).
2. The gain is the sale price less acquisition cost, excluding incidental acquisition costs (§ 27a (4) no. 2 EStG).
3. Shares acquired before 1 January 2011 (legacy holdings) are in principle subject to transitional rules; whether that covers your shares is something to settle with your tax adviser before signing (WKO; EStR para. 6103 et seq.).

If a holding company holds the shares or the GmbH sells its assets, other rates apply; they are in the table below. Two switches shape the tax burden.

First, the legal form: an interest in a corporation (GmbH) is taxed differently from the business of a sole trader or an interest in a partnership (OG or KG, the Austrian general and limited partnership forms).

Second, the deal structure: are you selling shares (a share deal) or individual assets of the business (an asset deal)? The difference is set out in asset deal or share deal — in tax terms it separates two worlds.

Legal form / structure	Taxation of the gain	Basis
GmbH share held privately (share deal)	27.5 % special tax rate	§ 27a EStG
GmbH share held via a holding company	23 % corporation tax, participation exemption may apply	§ 22 KStG
Sole trader / partnership	Income tax tariff, with reliefs	§ 24, § 37 EStG
Asset deal at the level of the GmbH	23 % corporation tax, then 27.5 % on distribution	§ 22 KStG, § 27a EStG

Source: RIS – Austrian Federal Legal Information System (ris.bka.gv.at), Income Tax Act 1988 (§ 27a, § 24, § 37), consolidated version of 20 Oct 2026, retrieved 20 Oct 2026; WKO, taxation of investment income (page dated 1 May 2026), retrieved 20 Oct 2026. The corporation tax figures (§ 22 KStG) reflect the legal position as at 6 Oct 2026. For financial years beginning after 31 December 2027, the corporation tax rate is 24 per cent on income above EUR 1 million (§ 22 (1) KStG as amended by Federal Law Gazette I No. 62/2026; RIS, version of 1 Jan 2028). Not tax advice.

Every decision that has to hold up rests on a company valuation.

How much tax is due when selling a GmbH in Austria?

Where a natural person sells GmbH shares, the gain on disposal — proceeds less acquisition cost — is subject to the special tax rate of 27.5 per cent (§ 27a (1) EStG; WKO, the Austrian Economic Chamber, retrieved 6 Oct 2026). Roughly three quarters of the gain remains. A worked example is in selling a GmbH: a tax calculation, and the underlying system in selling a GmbH: tax.

Three points that are often overlooked in practice:

Incidental acquisition costs do not count towards the acquisition cost of privately held shares (§ 27a (4) no. 2 EStG). Anyone who bore notary or advisory costs on the purchase therefore cannot deduct them against the gain.

GmbH shares cannot be held in a securities account. Capital gains tax is therefore not withheld automatically — the gain on disposal has to be declared in the tax return (WKO, retrieved 6 Oct 2026).

For shares acquired before 1 January 2011 (legacy holdings), the WKO states that transitional rules generally apply. Whether that covers your shares is something to settle with your tax adviser before signing.

Instead of the 27.5 per cent, ordinary taxation at the tariff can be elected on application (§ 27a (5) EStG). The option applies to all income subject to the special rate and is only worthwhile where the personal average tax rate is lower — on a multi-million sale, practically never.

Where the share sits in a holding GmbH, corporation tax of 23 per cent applies at the level of the seller (§ 22 KStG, since 2024: "for calendar years from 2024, 23 %"). Only the special case of an international participation exemption in a foreign subsidiary remains tax-free.

How is the sale of a sole proprietorship or partnership taxed?

On the sale of a sole trader business or of an interest in an OG or KG, the gain on disposal forms part of taxable income and is in principle subject to the progressive tariff. The top rate of 55 per cent applies to the part of income above one million euros in the calendar years 2016 to 2029 (§ 33 (1) EStG). That is not the end of the story, though — the law provides three reliefs, available as alternatives (WKO, page dated 1 Feb 2026).

Allowance (§ 24 (4) EStG): 7,300 euros of the gain remain tax-free on the sale of the whole business. Relevant above all where the gain on disposal is small — the WKO regards it as sensible only where the gain does not substantially exceed the allowance.

Half average tax rate (§ 37 (1) and (5) EStG): on application, the gain is taxed at only half the average tax rate that applies to total income. The conditions: seven years must have passed since the business was opened or since the last acquisition for consideration, and the sale must take place because the owner has died, has become incapacitated, or has reached the age of 60 and is giving up gainful activity. That cessation must be genuine: any active participation in working life counts as gainful activity. By law, only total turnover of up to 22,000 euros with income of up to 730 euros in a calendar year is disregarded; passive income such as a pension or rental income does not stand in the way of the relief (TPA, article of 24 June 2019).

Outlook on the half rate (draft, not enacted): the ministerial draft of the Tax Amendment Act 2026 (148/ME, consultation ended on 03.11.2026) would delete the requirement to stop gainful activity in § 37(5) EStG, but limit the relief from age 60 to once in a lifetime and exclude the sale of partnership interests by capital-providing partners, even if they were so only in the seven years before (retaining a capital-providing interest while selling the entire remaining interest does not preclude the relief); it would first apply to the 2027 assessment (Austrian Parliament, retrieved 31.10.2026). The assessment is in the overview 2027 tax changes for business sellers; until a decision is taken, current law applies.

Three-year spread (§ 37 (2) no. 1 EStG): on application, the gain is spread evenly over three years, smoothing the progression. Here too seven years are required — and the allowance and the half rate are then not available alongside it.

The particulars for sole traders are set out in selling a sole trader business.

Asset deal: why the GmbH pays twice

Where it is not the shareholder selling his shares but the GmbH selling its assets, the gain arises at company level and is subject to corporation tax of 23 per cent. If the money is then to reach the shareholder, Kapitalertragsteuer, or KESt (Austrian capital gains tax on investment income), of 27.5 per cent is added on distribution. In total a noticeably heavier burden than a share deal — which is why sellers prefer the share deal and buyers the asset deal. The details for Austria are in asset deal Austria.

Incidental costs that reduce the net proceeds

Not every burden is tax on the gain, but each one reduces what is left. A share deal attracts no Grunderwerbsteuer (Austrian real estate transfer tax); where an asset deal includes property, it does. Adviser and valuation fees reduce the net proceeds under the special tax rate but not the tax itself — they are not deductible there (§ 20 (2) no. 2 EStG). Items like these belong in the net calculation before you judge a purchase price to be "enough".

And in Germany?

German sellers face a different system. The underlying question remains the same as in Austria — legal form and structure first — but the numbers differ (legal position of the provisions: 6 Oct 2026, gesetze-im-internet.de).

Shares in corporations held privately: where the seller held at least one per cent within the last five years, the gain falls under § 17 EStG as trade income and is captured under the partial income procedure — 40 per cent remain tax-free, 60 per cent are subject to the personal tax rate (§ 3 no. 40 EStG). In addition there is an allowance of 9,060 euros, which melts away completely on larger gains (§ 17 (3) EStG). Below one per cent, the flat withholding tax of 25 per cent applies (§ 32d EStG), plus solidarity surcharge and, where applicable, church tax.

Shares held by a corporation: where a corporation holds the shares, the gain remains tax-free except for 5 per cent, which is treated as non-deductible business expenses (§ 8b (2) and (3) KStG).

Sale of a sole trader business or partnership interest: anyone who has reached the age of 55 or is permanently unable to work within the meaning of social security law receives, on application, an allowance of 45,000 euros, which is reduced by the amount by which the gain exceeds 136,000 euros (§ 16 (4) EStG). The allowance is granted only once. For gains up to 5 million euros, a reduced rate of 56 per cent of the average tax rate, but at least 14 per cent, can apply on application — likewise from the age of 55 or on permanent inability to work, and only once in a lifetime (§ 34 (3) EStG). Otherwise the one-fifth rule remains (§ 34 (1) EStG). Anyone selling across borders should settle the question of residence early.

Two changes from 2027 directly affect sellers in Austria: the deemed distribution on the shareholder current account and the higher real estate income tax on old holdings. Both are summarised in tax changes in 2027 for business sellers.

If business property is sold together with the company, separate rates apply to it; the change from 2027 is explained in the article on real estate tax on business property.

FAQ

How much tax do I pay on selling my GmbH?

As a natural person, 27.5 per cent on the gain on disposal, that is proceeds less acquisition cost (§ 27a EStG). Ordinary taxation at the tariff can be elected on application, but is only cheaper where income is low.

What is the half average tax rate on a business sale?

A relief under § 37 EStG: on application, the gain on disposal is taxed at only half the average tax rate. The conditions are seven years of business operation and a sale prompted by death, incapacity, or the owner having reached the age of 60 and giving up gainful activity. A ministerial draft (consultation ended on 03.11.2026) would delete the requirement to stop working and limit the relief to once in a lifetime; this has not been enacted.

Why is an asset deal unfavourable for sellers in tax terms?

Because the gain is charged first to corporation tax at 23 per cent and then again, on distribution, to KESt at 27.5 per cent. A share deal avoids that double layer.

Can I legally reduce the tax on selling my business?

Yes — through the choice of structure (a share deal rather than an asset deal), through use of the allowance, the half average tax rate or the three-year spread, and through timing. Those levers belong years before the sale, not in the final week of negotiation.

How is a GmbH share taxed if it is held through a holding company?

The gain is charged to corporation tax of 23 per cent at the level of the holding company. Tax exemption only applies in the special case of an international participation exemption in a foreign subsidiary.

Are adviser fees deductible against the tax on a sale?

Not under the special tax rate. Adviser and valuation costs reduce the net proceeds, but not the tax itself, so they belong in the net calculation rather than in the tax computation.

Do I have to declare the sale of a GmbH share in my tax return?

Yes. Because GmbH shares cannot be held in a securities account, capital gains tax is not withheld automatically; the gain on disposal has to be declared (WKO, retrieved 6 Oct 2026).

How much tax is due on selling a GmbH share in Germany?

With a holding of at least one per cent within the last five years, the partial income procedure applies: 60 per cent of the gain is subject to the personal tax rate (§ 17, § 3 no. 40 EStG). Below one per cent, the 25 per cent flat withholding tax applies (§ 32d EStG). Where a corporation holds the shares, 95 per cent of the gain remains tax-free (§ 8b KStG).

---

A company sale is the most important transaction of an owner life. Take independent, discreet advice — IGCP Capital Partners GmbH. igcp.at

A first orientation on the order of magnitude is provided by the calculator: determine your company value range – as an indicative value range, not an appraisal.

For the Austrian perspective on the same transaction: selling a GmbH in Austria. How we accompany owners from the first conversation to the handover is described on the services page business succession.

This article is not a substitute for tax advice. Sources retrieved 6 Oct 2026: RIS/JUSLINE (EStG, KStG), gesetze-im-internet.de (EStG, KStG), WKO, TPA; added 31 Oct 2026: Austrian Parliament (ministerial draft 148/ME and explanatory notes); procedural status checked 4 Nov 2026.