Taxation in Denmark
Spring 2016 Programme
• The Danish Tax System
• Preliminary income tax assessment (forskudsopgørelse)
• Tax assessment notice (årsopgørelse)
• Most common deductions
• Online shopping
• NemKonto (“Easy Account”)
• Skat.dk – how to look for information
• E-Tax (TastSelv) Change ”Årsopgørelsen” (tax assessment notice) Change ”Forskudsopgørelsen” (preliminary income tax assessment) View ”Skatteoplysninger” (personal tax information)
21-04-2016 2 The Danish Tax System
The Danish tax system is a complicated matter of rules and laws. You do not need to be familiar with all of these rules and laws, but it is important that you know what you need to do in relation to your tax.
You can find important information on how to pay tax in Denmark at: skat.dk/English
21-04-2016 3 The Danish Tax System
21-04-2016 4 The Danish Tax System
Direct taxes Indirect taxes Personal income tax VAT Corporate and fund tax Green taxes 67% 33% Property value tax Excise duties Inheritance tax Custom duties
Labour market contribution
21-04-2016 5 Direct taxes (withholding rate)
3 tax percent
Tax to the municipality
Church-tax (optional tax)
Health contribution
2 types of tax to the State
Bottom-bracket tax
Top-bracket tax (DKK 467,300)
Personal allowance
under 18 years DKK 33,000
above 18 years DKK 44,000
21-04-2016 6 Green taxes
Green taxes are taxes that you pay for spending society's resources. The more resources you spend, the more green taxes you must pay.
For example, green taxes are electricity, water and waste.
Compensation for higher green taxes ( the ”green cheque”) DKK 950, the amount will be reduced if your exceeds DDK 379,900 after deduction of 8 % labour market contributions.
21-04-2016 7 Preliminary income tax assessment – tax card
Three types of tax cards
• Tax exemption card (frikort) – if your income is low
• Primary tax card (hovedkort)
• Secondary tax card (bikort)
You always have to pay labour market contribution (AM-bidrag). It is 8% of your total income
21-04-2016 8 Tax exemption card (no tax other than Labour market contributions - AM-bidrag)
Preliminary income tax assessment
21-04-2016 9 Primary tax card (hovedkort)
Preliminary income tax assessment
21-04-2016 10 Tax calculation – an example
Salary per month DKK 15,500 15,500
- ATP (supplementary labour market pension) __- 45 - 45
15,455
- AM-bidrag 8% of 15,455 DKK 1,236 -1,236
Taxable income 14,219
Tax free amount per month _ 4,188
- Tax 38 % of 10,031 3,812
Net payment in the “pocket” DKK 10,407
21-04-2016 11 Tax assessment notice (Årsopgørelse)
You need to check and correct if necessary at E-tax
You have overpaid tax Entitled to a tax return (overpaid tax)? You will get money from SKAT + compensation 0,5 % or
You have outstanding tax You have to pay (outstanding tax) You must pay money to SKAT. + interest 3,0 %
21-04-2016 12 Tax assessment notice (Årsopgørelse) November March Preliminary income tax Tax assessment notice assessment
Salary 50.000 Salary 50.000 Benefits 12.000 Benefits 12.000 Transport deduction -3.000 Transport deduction -3.000 Interest -4.000 Interest -4.000 Taxable income 55.000
Taxable income 55.000 Bottom bracket tax 2.000 Bottom bracket tax 2.000 Health contribution 40 Health contribution 40 Municipality tax 2.500 Church tax 500 Municipality tax 2.500 Church tax 500 Calculated final tax 5.040 Calculated advance tax -5.040 Paid advance tax -5.040 Overpaid tax 0
21-04-2016 13 Most common deductions
• Deduction for transport between home and work – box 51
• Travelling expenses max. DKK 26,200 – box 53
• Child support – box 56 – form 04.071
• Interest expenses to the bank – box 42 – box locked in tax assessment notice
• Interest expenses to mortgage – box 41 - box locked in tax assessment notice
• Trade union fee max. DKK 6,000 – box 50 - box locked in tax assessment notice
• Unemployment insurance – box 52 - box locked in tax assessment notice
21-04-2016 14 Tax assessment notice – FAQ about deductions
Deduction for transport between home and work
You get deduction for transport between home and work if the distance you travel between your home and your workplace is more than 24 km a day.
It is not possible to claim tax-free transport allowance and deduction for transport between home and work for the same distance.
If your employer pays for your travelling there is nothing to declare in box 51.
21-04-2016 15 Transport deductions - between home and work
Rates for 2016 0- 24 km No deduction 25-120 km DKK 1.99 per km > 120 km DKK 1.00 per km
Rates for 2015 0- 24 km No deduction 25-120 km DKK 2.05 per km > 120 km DKK 1.03 per km
21-04-2016 16 Tax assessment notice – FAQ about deductions
Travel deduction or tax-free allowance – only if temporary employment or more than 24 hours away from home because of work – Box 53
Your employer does not cover your expenses as per account rendered or as free food and/or free accommodation and the employer does not disburse a tax-free travel allowance.
The distance and the work involved are also essential elements.
The distance is assessed based on whether you can travel between your home and the temporary workplace within a reasonable period of time, enabling you to stay the night at your own home.
21-04-2016 17 Deductions - Travel expenses
Rates for 2016 Up to a maximum of DDK 26,200 Food DDK 477 per day (24 hours) Accommodation DDK 205 per day (24 hours)
Rates for 2015 Up to a maximum of DDK 25,900 Food DDK 471 per day (24 hours) Accommodation DDK 202 per day (24 hours)
21-04-2016 18 Online shopping EU country and non-EU country
You do not pay customs duties and Danish VAT on products from an EU country.
You must pay Danish VAT if you buy products for more than DKK 80 which are shipped from a non-EU country.
You must pay customs duties if you buy products for more than DKK 1,150 which are shipped from a non-EU country.
You must always pay customs duties, Danish VAT and special duties on spirits, wine, beer, tobacco products, perfume and eau de toilette bought outside the EU.
21-04-2016 19 NemID
You need a NemID (Easy ID). NemID is your digital signature and the key to digital Denmark. It is a single login for Danish Internet banks and government websites.
You can obtain NemID at
• Your bank
• Citizen Service Centre (Borgerservice)
21-04-2016 20 Easy account (NemKonto)
You need a NemKonto (Easy Account) for payments from the public sector. This may be a Danish current account or your foreign bank account registered as your NemKonto.
You can get NemKonto in one of the following ways:
• Contact your bank and inform them which account to assign as your NemKonto.
• Assign an account number yourself at NemKonto selvbetjening. You can only do this if you have a NemID.
• If you live abroad and wish to assign a foreign bank account as your NemKonto you can use NemKonto‘s registration form, which you find at Nemkonto.dk – Choose “English & Deutsch”.
21-04-2016 21 skat.dk – how to look for information
21-04-2016 22 skat.dk – how to look for information
21-04-2016 23 E-tax
21-04-2016 24 Do it yourself (TastSelv menu)
21-04-2016 25 Do it yourself (TastSelv menu)
21-04-2016 26 Do it yourself (TastSelv menu)
21-04-2016 27 Tax assessment notice (årsopgørelse)
21-04-2016 28 Deduction for transportation
• Log on E-tax ”TastSelv” • Choose ”Ret årsopgørelsen” • Click on ”Befordring (kørselsfradrag)” (If the calculation is OK; click on ”Gå tilbage til årsopgørelsen” - or • Click ”Ret” (Change) • Fill in the boxes • Click ”Overfør beløb” (Transmit) • Click ”Godkend” (Accept) • Click ”Fortsæt” (Continue)
You can see your new tax assessment notice immediately
21-04-2016 29 Income from abroad If you have any income from abroad or a property abroad while staying in Denmark, and you are subject to full tax liability in Denmark, you also have to inform SKAT
1. Log on and choose:
3. Click “Fortsæt” (continue)
2. Scroll down to “Egen 4. Click “OK” virksomhed eller udlandsforhold” (own company or 5. Scroll down and click on the blue arrow income from abroad)
21-04-2016 30 Income and/or property from abroad
Fill in the boxes, click “Godkend” (Accept)
Click “Retur”
Click “Godkend” (Accept) Click “Fortsæt” (Continue)
You can now see your new tax assessment notice
21-04-2016 31 Preliminary income tax assessment (forskudsopgørelsen)
21-04-2016 32 Preliminary income tax assessment (forskudsopgørelsen)
21-04-2016 33 Preliminary income tax assessment (forskudsopgørelsen)
21-04-2016 34 Personal tax information (skatteoplysninger)
21-04-2016 35 Personal tax information (skatteoplysninger)
21-04-2016 36 Personal tax information (skatteoplysninger)
21-04-2016 37 View your E-tax card
21-04-2016 38 Translation of front page of TastSelv / E-tax
Log off
Main Tax Preliminary Payment Personal tax Vehicles Property value Contact Profile Help .page assessment income information notice assessment Change your email/mobile
Tax assessment notice Preliminary income assessment (tax card)
Your tax for 2015 and previous years The tax you pay during 2016
View the tax assessment 2015 Preliminary income assessment 2016
Change the tax assessment notice/ tax return 2015 Search your earned income this year
Pay outstanding tax
Report deduction for wage costs in connection with household services servicefradrag/håndværkerfradrag
21-04-2016 39 Important times during the Tax year
See or change your preliminary income assessment for the year to come
Complete your tax return online for ordinary taxation – Complete your tax no later than 1 May return online - only for those of you who have foreign income or income from your own company. No later than 1 July
21-04-2016 40 3 good links – borger.dk – e-boks.dk – skat.dk
21-04-2016 41 Contact information
- You are always welcome to contact us
• Skat.dk
• Telephone: 72 22 18 18
• Foreign tax: 72 22 28 92
• Personal meeting – by appointment only
21-04-2016 42