What is the Expat Tax Scheme in Denmark?

Denmark offers a special tax scheme for expatriates that allows eligible individuals to benefit from a flat tax rate on their gross salary. This scheme is designed to attract skilled professionals to Denmark by offering favorable tax conditions. Here’s an overview of how the expat tax scheme works:


Eligibility and Duration

  • Flat Tax Rate: 27%
  • Duration: Up to 84 months (7 years)


Conditions

To qualify for this scheme, expatriates must meet the following criteria:

  1. Minimum Salary Requirement: The guaranteed monthly salary, before deductions for employee pension contributions, must average at least DKK 75,100 per calendar year (2024 threshold).

  2. Taxable Income: The 27% tax rate applies to:

    • Cash salary
    • Employer-provided telephone and internet
    • Taxable value of employer-provided company cars
    • Employer-paid taxable health insurance

  3. Note: All other types of income are taxed according to the standard Danish tax rates.


Tax Treatment

  • Flat Rate Application: The flat 27% rate covers the aforementioned types of income. This rate does not allow for deductions against the taxed income.
  • Post-84 Months: After the 84-month period, income will be taxed at the ordinary Danish tax rates.


This tax scheme is beneficial for expatriates who meet the criteria, providing a predictable tax rate during their stay in Denmark. 

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