Ökosoziale Steuerreform 2022 approved by the National Council - "Boiler replacement" and thermal refurbishment of buildings subsidised

The Eco-Social Tax Reform 2022 was passed by the National Council on 20 January 2022 (we reported extensively on the draft bill in AI 12/21). The legislative process saw no significant changes compared to the government's proposal. In addition to various amendments in the area of income tax law (including the new regulation of the taxation of cryptocurrencies) in Part I of the Tax Reform Act, the Eco-Social Tax Reform includes the introduction of the regional Climate Bonus (Climate Bonus Act as Part II of the Tax Reform Act) as well as, for example, the reduction of the social security contribution rate for health insurance for self-employed individuals with low to medium incomes (Part III of the Tax Reform Act).

As part of the tax reform, the shift from fossil fuels to climate-friendly systems is also to be promoted. Specifically regarding the implementation of the heating strategy, this also means that at the private individual level, the exchange of a fossil fuel-based heating system for a climate-friendly system (so-called "boiler replacement"), such as district heating, will be subsidised. Furthermore, the thermal renovation of buildings will also be supported through tax deductibility in the form of lump sums as special expenses.

In principle, for a period of five years, €800 per year can be claimed as special expenditure for the thermal energy renovation of buildings. A boiler replacement is subsidised with €400 per year (again as special expenditure). The derivation of these amounts is somewhat more complex – the expenses for the boiler replacement or building renovation must be reduced by the subsidy paid by the federal government (Federal subsidy under the Environmental Subsidy Act) and must then still amount to more than €4,000 for the thermal renovation of buildings or more than €2,000 for the boiler replacement. Actually, only a lump sum can be deducted as special expenditure per calendar year, with the €800 for building renovation being claimed for tax purposes as a priority. However, if further such subsidised expenses are incurred within the five calendar years, the lump sum can be taken into account for a total of 10 calendar years. In cases where the lump sum cannot be claimed for tax purposes from the year the subsidy is paid, it can, however, be taken into account from the 6th year in the form of €800 for thermal building renovation or €400 for boiler replacement.

From a time and administrative perspective, federal funding must have been disbursed for the refurbishment and renovation measures after 30 June 2022, with the funding application having to be submitted after 31 March 2022. The lump-sum special expenses will be automatically taken into account as part of the assessment, as the funding agency will transmit the relevant information to the tax authorities.

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