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Unemployment benefits in Austria: Who is eligible and how much can you get?

For many people, unemployment benefits are a lifeline after losing a job. But how does the system work in Austria and how much financial support can you receive?

Published: 21 September 2021 14:50 CEST
Updated: 15 April 2024 16:28 CEST
Unemployment benefits in Austria: Who is eligible and how much can you get?
How do you apply for unemployment benefits in Austria - and how much do you get? Photo by Sora Shimazaki from Pexels

In Austria, unemployment benefit is called Arbeitslosengeld (literally ‘unemployment money’) and is available for people who lose their job or enter a period of unemployment.

It is for people that are registered as unemployed with the Austrian Public Employment Service (AMS) and who are ready to work at least 20 hours per week once a job has been found.

Then there is an additional benefit called Notstandshilfe, which is essentially a form of emergency financial assistance in case unemployment benefits run out.

However, certain conditions have to be met, such as being able and willing to work, already registered as unemployed with the AMS and being ready to be placed on the job market. 

To be eligible for Notstandshilfe, an application must be submitted no later than five years after unemployment benefits have ended.

Some people may also be eligible for a family allowance, depending on their situation.

Who is eligible for unemployment benefits?

To be eligible for unemployment benefits in Austria, you must have been in employment for 52 weeks out of the past two years.

For people applying for unemployment benefits for the second time or more, a record of being in employment for 28 weeks in the past year is enough to become eligible.

Similarly, for people aged 25 and under, 26 weeks of work in the past year is sufficient.

Self-employed people are entitled to unemployment benefits but only under certain conditions and the AMS doesn’t provide examples. Instead, people are urged to contact the AMS with any questions.

FOR MEMBERS: Working in Vienna: How to find a job in the Austrian capital

However, self-employed people can take out voluntary unemployment insurance through the organisation of social insurance for self-employed people (Sozialversicherung der Selbständigen), known as SVS.

Voluntary unemployment insurance is an additional financial contribution on top of the standard health and social insurance payments that are compulsory for self-employed people.

How much money can be claimed in unemployment benefits?

In Austria, the amount of unemployment benefits that a person can receive depends on whether they are eligible just for the basic amount or for the additional allowances as well.

In fact, the AMS even has a note on its website that states the basic amount can be difficult to calculate.

To simplify it though, in most cases the benefit is determined by the amount of monthly social insurance contributions made by an individual. 

In certain cases, a supplement might be added if the basic amount is lower than the compensation allowance target. This is currently set at €1,110.26 per month.

There is also a maximum limit, which means unemployment benefits can’t exceed 60 percent of your net income (for people not entitled to family allowances).

Who is eligible for a family allowance?

The family allowance is paid on top of the standard unemployment benefits and is typically for people with children that are considered dependents, including step-children, foster children and grandchildren.

The family allowance might also be paid if the claimant has a spouse or partner with little or no income.

How to claim unemployment benefits in Austria

The first step to claiming unemployment benefits in Austria is to register as unemployed with the AMS. Then you can submit an application to make a claim.

Applications should be submitted via an eAMS account, which is an online portal of the AMS. Registration for an eAMS account can be found here.

READ ALSO: How to find a job in winter sports in Austria

For anyone unsure about this process, the AMS can be contacted by phone or email. The AMS team will then send out an application form for unemployment benefits by post.

Useful websites

Austrian Public Employment Service (AMS)

Social Insurance for Self-Employed People (SVS)

Useful vocabulary

Arbeitslosengeld – unemployment benefits

Notstandshilfe – emergency assistance (financial)

Sozialversicherung – social insurance

Familienzuschlag – family allowance

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WORKING IN AUSTRIA

Why are people in Austria paying more taxes despite federal reforms?

Workers in Austria are still among those with the highest tax burdens in the world, with the taxes and contributions taking more than 40 percent of wages even as the country introduced sweeping tax reforms.

Published: 26 April 2024 12:21 CEST
Why are people in Austria paying more taxes despite federal reforms?

It’s often said that Austria is a country with high quality of living and high taxes, but a new OECD study shows just how high the tax burden is here compared to other OECD countries.

According to the report, Austria has the third-highest tax burden on workers and the so-called “tax wedge”, how much of a worker’s wage is taken by the government,  increased as well.

According to the OECD, in most countries, the increase in labour taxation was primarily driven by increases in personal income tax.

This is because nominal wages increased in 37 out of 38 OECD countries as inflation remained above historic levels. However, since most of these countries do not have automatic indexation of tax systems, high inflation tends to increase workers’ tax liabilities by pushing them into higher tax brackets. 

However, Austria’s federal tax reforms removed this in the country in 2023. This means that once inflation rises, the tax brackets that define how much taxes you will pay on your income will also rise – and they have risen in 2023 and in 2024 since the change. 

The measure was known as the “end of the cold progression” in Austria and should have protected workers’ incomes from inflation losses.

READ ALSO: The tax benefits that parents and families receive in Austria

What is the tax ‘wedge’?

The OECD defines a tax wedge as “income tax plus employee and employer social security contributions, minus cash benefits.” 

In other words, if an employer has a labour cost of €100, how much will they actually see in their pockets, and how much of this goes to the state? According to the organisation, the percentage is the tax wedge.

In Austria, €100 earned by a single employee without children was taxed at an average of €47.2 last year. The amount was only smaller than in Germany (47.9 percent) and Belgium (52.7 percent) and it rose compared to the previous year when it was still at 46.9 percent.

The average of the 38 OECD countries was 34.8 percent.

Married single-earner couples with two children also have high tax burdens, with a tax wedge of 32.8 percent (OECD average: 25.7 percent), which is the eleventh-highest tax and contribution burden within the OECD for this group (2022: 13th place). For married dual-earner couples, the wedge was 40.6 percent.

The tax wedge for individuals or households with children is generally lower than those without children, as many OECD countries grant households with children a tax advantage or cash benefits.

READ ALSO: Why it’s worth filling in your annual tax return in Austria

Why is Austria’s tax burden higher this year?

Despite the tax reform presented by the government, Austria’s tax wedge has increased compared to the year before. 

The reason is the relief granted in Austria in 2022 in the form of one-off state payments. With the rising cost of living, the federal government released several temporary measures to help people in the country cushion the effects, including the popular €500 Klimabonus payment every person who had been a resident of Austria for at least six months was entitled to. 

These payments and increases in family allowances reduced the tax burden in 2022 – but they no longer exist or were drastically cut in 2023. Because of that, the tax burden is rising again. 

“The abolition of cold progression and the other measures have merely prevented the tax burden from rising more sharply,” Wifo economist Margit Schratzenstaller told Der Standard.

The report said the increased tax issues show that there is still a need for action. Compared to other industrialised countries, Austria’s tax burden on work for a single person without children is ten percentage points higher. Of course, the expert noted, the fact that many industrialised countries have a different social system with fewer publicly funded benefits also plays a role here. However, labour is also expensive in Austria compared to the EU average.

READ ALSO: What foreign residents in Austria should know about taxes

“The fact that the tax burden on the middle classes has increased is due to the government’s failure. Instead of structural relief, there have been one-off payments that have evaporated,” said Lukas Sustala, head of Neos-Lab, the think tank of the liberal opposition party.

NEOS representatives have urgently called for a ‘comprehensive tax reform’ to alleviate the heavy labour burden, with a significant reduction in non-wage labour costs, according to an ORF report.

In addition, NEOS proposes the creation of ‘tax incentives for full-time work’ – including a full-time bonus and tax exemption for overtime pay. Simultaneously, NEOS aims to eliminate ‘part-time incentives of any kind’, offering a potential boost to the economy and workers’ incomes.

Economist Schratzenstaller also recommends action: She suggests reducing social insurance contributions, for example, for health insurance companies. However, it’s important to note that intervening in this area could affect the largely autonomous financing of Austria’s healthcare system, which is funded mainly through workers’ and companies’ payments via social insurance contributions. 

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