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Tax scheme 2010

Therre are several tax scheme options when you move to Denmark for working. When you sign a contract and accept a job in Denmark, then it is important to find out more about your tax liability. Schemes that can reduce your tax burden.

Schemes that can reduce your tax burden:
- A flat 25 % tax scheme
- Reduced tax liability if you live in another country, but work in Denmark 

To benefit from the 25 per cent tax rate, some conditions must be met by the employer, the employee and the employment. For example it is required that:
- the employee has not been subject to tax in Denmark during a period of 3 years prior to the employment in Denmark, 

- the monthly pay for key employees must be minimum DKK 63,800 (2010) after deduction of ATP payments, labour market contributions, special pension savings and any obligatory foreign social contributions, 

- the employee does not participate, and has not participated, directly or indirectly, in the management, control or capital of the employer during the employment or during a period of 5 years prior to the employment. 

The 25 % tax scheme does not need preapproval from the authorities and it is your personal responsibility to make sure that you fulfill the conditions for the scheme. 

Danish Tax authorities:
You are obliged to contact the authorities as soon as you arrive to Denmark. You have to contact the “Folkeregister” to get a civil registration number. 

Then you contact the “skatteforvaltning” (tax administration) in the “kommune” in which you reside. 

The tax authorities generate your tax card against a background of the information you have given them about your financial circumstances. The employer uses the tax card to deduct taxes. The tax card tells the employer whether you are entitled to personal allowances. 

If you don’t handle your tax card in time, then the employer must deduct 60 % of the wage without any deductions or allowances. 

Inwema 2010

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