OGH on Tax Compensation for Lost Earnings

Nov 28, 2025 Benn-Ibler Rechtsanwälte

The Austrian Supreme Court (Oberster Gerichtshof, hereinafter OGH) has confirmed that, in cases where someone is seeking reimbursement for tax compensation due to lost earnings, the usual rules about who must prove their claims still apply. Shifting the burden of proof to the injured party is not allowed, even if they can easily access relevant documents such as tax notices.

In the case at hand, after a traffic accident, the defendant had compensated the plaintiff for lost earnings. Later, the defendant realised it was unclear whether the plaintiff had actually paid taxes on the compensation received and therefore requested repayment of the excess tax amounts. The OGH found that no agreement about the tax issue had been made. When the payments were made, there was neither a dispute nor uncertainty regarding tax liability that could justify a settlement under Section 1380 of the Austrian Civil Code (Allgemeines bürgerliches Gesetzbuch, ABGB).

Tax compensation as advance payment: Obligation of the injured party to cooperate

Case law states that tax compensation for lost earnings is an advance payment. If the tax burden is less than expected, the injured party can claim reimbursement. They must disclose how payments are used and provide evidence, but failing to do so does not shift the burden of proof.

The burden of proof regarding the reimbursement of overpaid tax compensation remains with the party deemed responsible for the injury. A reversal of the burden of proof may only be warranted in instances where it is excessively burdensome to present evidence. Nevertheless, as the defendant is entitled to request relevant information from the plaintiff, such situations are expected to be rare. While refusal to produce documentation may be interpreted as obstruction during evidence evaluation, this does not impact the fundamental allocation of the burden of proof.

Burden of proof and duty to cooperate are distinct concepts

The OGH overturned the court of appeal’s decision due to an objection to evidence that was not addressed, sending the case back for further proceedings. Additionally, the OGH clarified that neither the proximity of available evidence nor the injured party’s lack of cooperation are valid reasons to shift the burden of proof. Therefore, the court confirmed that, even in cases involving tax-related compensation payments, it is still the claimant’s responsibility to prove there was an overpayment; the injured party’s obligation to cooperate does not substitute for this requirement.

OGH 2 Ob 127/25b (18 September 2025)