Austria to launch tax-free savings accounts for children with a €500 state bonus

Starting in the middle of 2027, Austria will introduce a “Zukunftsdepot” that permits parents or relatives to contribute up to €5,000 annually to a child’s investment account without incurring capital-gain tax or management charges, remaining tax-free until the child reaches adulthood. The coalition of ÖVP, SPÖ and Neos approved the measure after securing budget coverage, and a €500 bonus will be granted to every child born in 2027, sourced from the Familienlastenausgleichsfonds.

Eligibility hinges on the child’s primary residence in Austria and Austrian citizenship or a comparable legal status. If an account is not opened by the child’s third birthday, the bonus will be retained by the federal treasury or the OeBFA. Investment options are limited to regulated mutual funds or government securities, with high-risk products such as leveraged instruments excluded, while the exact permissibility of single-stock purchases remains unclear. The initiative aims to promote early financial education and support family savings, though critics warn it may favor wealthier households.