In the past, Austria’s location in the Centre of Europe has highly benefited international investors. Austria offers optimal access to the growing markets of Eastern and Southeastern Europe. It further provides a highly educated and motivated workforce; a banking system strongly linked with emerging markets and one of the most reliable and sophisticated legal systems in Europe. Its moderate corporate and foundation taxation as well as its banking secrecy, guarantee an effective legal framework for business transactions and investments for private purposes. Austria as a member of the European Union disposes of a banking secrecy which is not affected by OECD standards, contrary to Belgium and Luxembourg. Additionally capital investment structures, such as the Austrian Private Foundation, allows a fiscally privileged and anonymous retention of capital assets similar to Liechtenstein and thereby combine the advantages of, both, Switzerland and Liechtenstein.
Group Taxation
One of Austria’s fiscal advantages is the group taxation scheme. Under the group taxation scheme two ore more companies exercise their option to form a tax group. The taxable results of the domestic group members are attributed to their parent company and will be taxed on this level. Therefore, tax losses of group members can be consolidated with the taxable profits of other group companies. Profits can be attributed for tax purposes. In order to qualify for a tax group one company must participate in more than 50 % of the share capital of the other company. Holding companies may participate in a tax group without active business. Fulfilment of additional criteria’s such as organizational and economic integration, as well as a profit and loss takeover agreement are not required. Depreciations of participations within a tax group are tax neutral. Foreign losses of a tax group may also involve foreign group members and therefore, losses of foreign subsidiaries within a tax group can be accumulated with profits in Austria. Furthermore, profits realised by foreign subsidiaries are not subjected to taxation in Austria. 
Private Foundations
Another advantage worth mentioning is the benefits that come from the Austrian Private Foundation Act. According to the Act a private foundation is a legal entity and is in the ordinary course established during founder’s lifetime. The establishment of a private foundation avoids division of family business and can also serve as a shareholder in a corporate structure. The establishment of a private foundation is an appropriate way to ensure that the founder’s lifework will be preserved beyond his death and will be managed in accordance with his directives.
Until recently, the abolished Austrian Gifts and Inheritance Tax Law provided the basic legal framework for the taxation of natural persons as well as donations to private foundations in Austria. Contributions of capital to Austrian Private Foundations are now taxed at a flat rate of only 2.5 %.
Subsequent distributions to beneficiaries are subject to 25 % capital gains tax. Contrary to Liechtenstein, the Austrian Private Foundations are deemed to be vested with legal capacity and their income is therefore fiscally not attributed to the foreign founder within the European Union. Similar to Liechtenstein, the identity of the founder is not publicly disclosed. Additionally, in comparison to other jurisdictions within the EU, Austria provides for an effective protection of assets as the Austrian time limit for claiming the legal portion in inheritance matters or in view of other creditors is very short.
Summary
Numerous factors speak in favour of investments in Austria. As a centre for international private banking activities, Austria offers a wide and diversified range of investment categories. In a world in which traditional bastions of private banking are coming under increasing international pressure, with erosion of banking secrecy and changes in the tax and legislative environment, Austria has successfully positioned itself as an European financial centre of international importance.
The stability and reliability of Austria as a banking centre, the attractive tax conditions for international investors, true banking secrecy and the highly educated workforce have helped make Austria an unostentatious alternative to more conventional banking locations. The succinct advantages of Banking in Austria are an outstanding political and economic stability, advantageous tax climate for non-residents, banking secrecy, strong legal framework, strictly regulated financial markets, large number of double taxation agreements and the advantageous geographical location at the heart of Europe.
Christoph Kerres
Attorney at Law
Schubertring 2
1010 Vienna
Austria
Tel: +43 1 51660
Fax: +43 1 51660 60
Email:
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www.kerres.at
Where work is like a holiday: an event paradise in Zell am See
Green pastures, majestic mountains and a sparkling lake within eyeshot - the Ferry Porsche Congress Center (FPCC) is situated in one of the most attractive tourism regions of Austria. It is not least due to the large variety of activities in Zell am See-Kaprun that the innovative convention center has made a name for itself since it opened its doors in September 2007. Many in-house services, the best local hotels as partners, and a flexible spatial concept make the FPCC a highlight in a fairy-tale Alpine world.
But where does the title Ferry Porsche Congress Center come from? 'The name is no coincidence', says Alexander Höller, FPCC's marketing director. 'The convention center pays homage to Zell's honorary citizen Ferdinand Anton Ernst Porsche.' The member of the famous car manufacturer dynasty developed the legendary Model 356 and had a substantial impact on the design vocabulary of sports cars. This innovative spirit also applies to the FPCC. The magic word for its spatial concept is flexibility - which enthrals event organizers. The movable walls of eight light-flooded seminar rooms allow unlimited planning possibilities. Up to 1,000 visitors can be seated at different events. A huge open-air area grants a breathtaking view of the local mountain of Schmittenhöhe.
And that's not all: the house offers state-of-the-art technology. Wireless internet access and modern light and sound equipment leave nothing to be desired. But the unique full-service concept includes even more: a shuttle service takes visitors to the gates of the FPCC and external services like first-class decoration or a professional photographer are available. Just ask the team of the Ferry Porsche Congress Center. The cuisine is unique, too: the premium in-house-catering service puts exquisite culinary treats on the plates of its guests and a big smile on their faces.
The tourism region outside the aesthetic building has many offers up the sleeve, too. The perfect infrastructure of the versatile leisure industry is ideal for side events. Relaxing hiking tours and teeing off in front of the Alpine panorama leave nothing to be desired. The FPCC is located right next to the pedestrian precinct of Zell. Only a short
walk separates you from a shopping tour in the warm sun after an event at the convention center. And neighbouring Kaprun can be reached easily by bus or car.
By the way: the well developed infrastructure promises a relaxed journey. Carefully chosen partner hotels offer comfortable lodging for their guests. 'Our criteria were highest comfort and a short distance to the FPCC', says Höller. And indeed: a walk from any of the luxurious hotels to the 'Center of Uniqueness' doesn't take longer than eight minutes. 4,100 beds are available, 1,700 of them in the four and five-star segment. Hence, it is easy to cross the border between work and holidays in Zell am See - most definitely when it comes to events in the Ferry Porsche Congress Center.
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