Privatkonkurs: Personal Insolvency in Austria (Schuldenregulierungsverfahren)

Privatkonkurs is the term Austrians use in everyday speech for personal insolvency, the court process that lets an individual who cannot pay their debts reach a binding arrangement with creditors and eventually be released from what remains unpaid. It has no separate legal definition of its own.

The formal name in the statute is the Schuldenregulierungsverfahren, a set of special rules for natural person debtors found in §§ 181 to 216 of the Insolvenzordnung (IO), the Austrian insolvency code. § 181 IO applies the ordinary insolvency procedure to a natural person, modified by those special rules.

This page explains how the Schuldenregulierungsverfahren works, the two routes a debtor can take inside it, and a rule that changed on 17 July 2026 affecting how long a private individual's plan now runs. Much of what is published elsewhere online about the duration of this procedure predates that change and is now out of date.

Information last verified on 22 July 2026. This page provides general legal information about Austrian law and does not constitute legal advice in an individual case.

What Privatkonkurs (Schuldenregulierungsverfahren) Actually Is

The Schuldenregulierungsverfahren is opened at the debtor's own request, at the Bezirksgericht with jurisdiction over the debtor's residence, once the debtor is insolvent, meaning unable to pay debts as they fall due. It is a single procedure with two possible debt relief outcomes, not two competing courts to choose between.

Every case starts the same way: the debtor's assets and income are established, all creditors are given the chance to register their claims, and a Zahlungsplan is put to a creditor vote first. Only if that fails does the case move on to an Abschöpfungsverfahren.

At the end of either route, once the debtor has completed what they agreed or what the court ordered, the debtor is released from any remaining unpaid debt through Restschuldbefreiung, a formal discharge. Nothing about the Schuldenregulierungsverfahren erases debt on the day it opens; the discharge is the reward for completing the plan, not a starting point.

The Two Debt Relief Routes: Zahlungsplan and Abschöpfungsverfahren

Zahlungsplan: Negotiating a Quota Directly With Creditors

A Zahlungsplan is the first route attempted in every Schuldenregulierungsverfahren. The debtor proposes a quota, a percentage of the total debt, to be paid to creditors on an agreed schedule, and creditors vote on whether to accept it.

§ 194 Abs 1 IO sets the floor for that offer: the debtor must propose at least a quota matching what their income is expected to allow over the next three years. The payment schedule itself, however, can be spread out over up to seven years, so the three year figure sets the size of the offer, not how quickly it must be paid.

Where the debtor is not expected to earn any attachable income in that period, or only marginally exceeds the Existenzminimum, the same provision allows the Zahlungsplan to proceed with no payment offer at all. This matters for debtors with very low income, disability, or other circumstances that leave little or nothing above the protected floor.

Abschöpfungsverfahren: Court Supervised Cession of Income

If creditors reject the Zahlungsplan, or the debtor cannot realistically make one, the case moves to an Abschöpfungsverfahren. Instead of a negotiated quota, the debtor cedes the attachable part of their income to a court appointed trustee for a fixed number of years, and that money is distributed to creditors.

§ 199 Abs 1 IO gives the debtor two variants to apply for: a Tilgungsplan or an Abschöpfungsplan. § 199 Abs 2 IO states both durations in the same provision: a Tilgungsplan runs for three years, and an Abschöpfungsplan runs for five years.

Throughout either variant, the debtor keeps the Existenzminimum, the same protected minimum income that applies in ordinary wage garnishment under § 291a EO. Only the attachable portion above that floor is ceded to the trustee, and only that portion goes to creditors.

The Consumer Duration Just Changed: Five Years, Not Three

This is the fact most in need of updating on any page about Privatkonkurs written before mid-2026. § 283 Abs 9 IO provides that the Tilgungsplan provisions, meaning §§ 199, 201 Abs 2 and § 216 Abs 1, cease to apply insofar as consumers (Verbraucher) are affected, with effect from the end of 16 July 2026.

The three year Tilgungsplan for consumers was itself a relatively recent, and always temporary, addition. It was introduced with effect from 17 July 2021, for applications filed after 16 July 2021, as part of Austria's implementation of the EU Restructuring and Insolvency Directive. It was never presented as a permanent feature of consumer insolvency.

As of today, that temporary window has closed. A private individual whose application for an Abschöpfungsverfahren reaches the court on or after 17 July 2026 can no longer choose the three year Tilgungsplan. The only variant open to them is the Abschöpfungsplan, running five years under § 199 Abs 2 IO.

This is current, primary confirmed Austrian law as verified on 22 July 2026. It is stated here plainly as the present rule, not as a permanent feature of the IO; if a further legislative amendment changes it again, that would need its own verification against § 283 Abs 9 and the note attached to § 199 IO before being relied on.

Entrepreneurs Keep the Three Year Tilgungsplan

The 17 July 2026 change does not touch every debtor equally. § 283 Abs 9 IO withdraws the Tilgungsplan only insofar as consumers are affected. An entrepreneur, meaning a debtor whose insolvency arises from a business or self employed activity rather than private consumption, keeps access to the three year Tilgungsplan regardless of when they file.

The Tilgungsplan itself has not been abolished as a legal instrument. It has been withdrawn from one category of debtor, private consumers, while remaining the standing rule for the other, entrepreneurs, who were always the primary audience the EU Restructuring Directive's three year minimum was written for.

Whether a given debtor counts as a consumer or an entrepreneur for this purpose can turn on the facts of how their debts arose. A debtor unsure which category applies to them should raise this specifically when consulting a lawyer or the Schuldnerberatung before filing, since it decides which Abschöpfungsverfahren duration is even on the table.

Filed Before 17 July 2026? The Grandfathering Rule

§ 283 Abs 9 IO is not retroactive against debtors already in the system. The Tilgungsplan provisions remain applicable to a consumer whose application for an Abschöpfungsverfahren with Tilgungsplan reached the court before 17 July 2026, even though the case may still be actively running today.

In practice this means two consumers who both filed for personal insolvency in 2026 can be on different tracks purely because of which side of 17 July their application landed on. One keeps a three year plan to its conclusion; the other, filing only days later, is on a five year Abschöpfungsplan.

A debtor already partway through a three year Tilgungsplan does not need to do anything differently because of this change. The grandfathering is automatic and tied to when the application reached the court, not to any action the debtor needs to take now.

Worked Example: What the Duration Change Means in Practice

Consider a private individual with 300 euros a month of attachable income above the Existenzminimum, a realistic figure for a modest income once the protected floor is subtracted. This example uses a round number to illustrate the mechanism; an individual's own attachable amount depends on their actual income and the current Existenzminimum table.

Under the three year Tilgungsplan that was available to consumers filing before 17 July 2026, that debtor would cede attachable income to the trustee for 36 months, or 10.800 euros in total, before Restschuldbefreiung.

Under the five year Abschöpfungsplan that now applies to a consumer filing on or after 17 July 2026, the same 300 euros a month runs for 60 months instead, or 18.000 euros in total, before the same discharge is reached. The monthly amount ceded is unchanged; only the number of months it runs for has grown by two years.

A Zahlungsplan works differently and is worth comparing directly. If the same debtor instead negotiates a Zahlungsplan and their income over the next three years supports a minimum offer of, say, 400 euros a month, the floor set by § 194 Abs 1 IO is 14.400 euros in total (400 euros times 36 months). That total can then be spread out over a schedule of up to seven years, meaning as little as roughly 171 euros a month if the full 84 month term is used, rather than paid at the pace it was calculated.

How the Schuldenregulierungsverfahren Proceeds

The debtor files an application with the Bezirksgericht, together with a statement of assets, income and debts. The court examines whether the debtor is genuinely insolvent and whether the application is complete.

Creditors are notified and can register their claims within the deadline the court sets. A Zahlungsplan proposal, if the debtor is making one, is put to those creditors for a vote at a scheduled hearing.

If the Zahlungsplan is accepted by the required majority and confirmed by the court, the debtor pays according to that plan and is discharged once it is completed. If it is rejected, or the debtor could not realistically propose one, the court instead opens an Abschöpfungsverfahren, and the debtor's attachable income is ceded to a trustee for the applicable Tilgungsplan or Abschöpfungsplan term.

Throughout the Abschöpfungsverfahren, the trustee distributes what is collected to registered creditors on a periodic basis, and the court can address a debtor's failure to meet the ongoing obligations of the plan, such as making a reasonable effort to earn income. At the end of the term, provided the debtor met those obligations, the court grants Restschuldbefreiung.

Privatkonkurs and Related Austrian Debt Procedures

A creditor does not need a debtor to be in a Schuldenregulierungsverfahren to pursue a debt outside it. Ordinary enforcement under the EO, including wage garnishment, can run against a debtor before insolvency is ever filed, and understanding how that enforcement works clarifies why entering a Schuldenregulierungsverfahren often follows a period of garnishment rather than preceding it.

Debt collectors pursuing a claim before any court proceeding are separately regulated, and their fees are capped. See debt collection for how those caps work and what a debtor can dispute before a claim ever reaches court or an insolvency filing.

Frequently Asked Questions

What is Privatkonkurs in Austria?

Privatkonkurs is the common name for the Schuldenregulierungsverfahren, the insolvency procedure for natural persons set out in §§ 181 to 216 IO. It lets an individual who cannot pay their debts reach either a negotiated Zahlungsplan or a court supervised income cession leading to discharge of the remaining debt.

How long does an Austrian personal insolvency last now?

For a private individual whose application reaches the court on or after 17 July 2026, the Abschöpfungsverfahren runs as an Abschöpfungsplan for five years, under § 199 Abs 2 IO. The shorter three year Tilgungsplan that consumers could use since 2021 ceased to apply to new consumer filings at the end of 16 July 2026, under § 283 Abs 9 IO.

Is the three year Tilgungsplan gone completely?

Not for everyone. Entrepreneurs keep access to the three year Tilgungsplan, since § 283 Abs 9 IO withdraws it only insofar as consumers are affected. A private individual also keeps the three year Tilgungsplan if their application reached the court before 17 July 2026.

What is the difference between a Zahlungsplan and an Abschöpfungsverfahren?

A Zahlungsplan is a quota the debtor negotiates directly with creditors, requiring an offer of at least what their income allows over the next three years, with a payment schedule of up to seven years, under § 194 IO. An Abschöpfungsverfahren is the fallback if creditors do not accept a Zahlungsplan, and it works by ceding the debtor's attachable income to a trustee for three or five years depending on which variant applies.

Does a debtor keep any income during the procedure?

Yes. Both Abschöpfungsverfahren variants only capture the debtor's pfändbarer, meaning legally attachable, income. The Existenzminimum, the protected floor set under enforcement law, stays with the debtor throughout, the same as it would in an ordinary wage garnishment.

What happens if a debtor filed for Privatkonkurs before the change?

The rule is not retroactive. § 283 Abs 9 IO keeps the three year Tilgungsplan available for any application that reached the court before 17 July 2026, even though the case may still be running today.

Does Privatkonkurs erase all debt automatically?

No. The debtor still has to complete either the agreed Zahlungsplan quota or the full Tilgungsplan or Abschöpfungsplan cession period. Only after that is the remaining unpaid debt discharged through Restschuldbefreiung.

Can a self employed person use the same procedure as a private individual?

The Schuldenregulierungsverfahren applies to any natural person, including entrepreneurs. The practical difference after 17 July 2026 is the Abschöpfungsverfahren duration: entrepreneurs keep the three year Tilgungsplan, while consumers are limited to the five year Abschöpfungsplan for new applications.