Personal incomes, including all forms of salary and capital gains wherever
arising, are subject to taxation in Denmark once you have exceeded 180 days in
the country. Tax levels are set very high, with the top
bracket currently at 63%.
A reduced rate tax scheme exists for foreign sportsmen and women and
specialist workers. If your company can prove that you have a recognised specialism
that they cannot find in Denmark, such as certain research scientists, you may
be eligible for the scheme. You may not, however, apply if you have been tax
resident in Denmark in the three years prior to starting your contract. If
successful in your application, you will pay tax at a fixed rate of 25% on all
of your earnings.
People residing in Denmark pay various kinds of tax. Key
among them are:
- Direct tax on personal income
- Indirect tax, e.g. VAT and duties on goods and services
- Property tax
- Church tax, members of the state church only
Denmark has a graduated taxation. That means that the more one earns, the
more tax one pays.
Danish tax includes a contribution to the Danish church. When you apply for
your CPR-number (social security / personal number) you should make it known
if you are not a member of the church as you will not be obliged to pay the
tax. For more detailed information on taxation in Denmark, please log onto:
http://www.workindenmark.dk/Taxation
