Årsopgørelse: What you need to know as Denmark releases annual tax return
Denmark’s tax authority Skat released the country’s annual personal tax returns on Monday, resulting in thousands across the country queuing online to check their details.
Although Monday is the official day for release of personal tax returns – årsopgørelse in Danish – some of the returns were published on the Skat.dk website from Friday evening.
That resulted in long queues online, with up to half a million people on the tax agency’s website on Saturday morning.
No queues to log in were ongoing as of Monday afternoon.
The årsopgørelse is calculated and displayed on the SKAT website at the beginning of March, after which taxpayers can edit their tax information, such as by changing income or tax exemption information. Details must be updated within a set deadline, which falls at the beginning of May.
Around three out of four taxpayers in Denmark get refunds after the yearly annual return. The amount refunded varies from person to person although many others have to pay money back to the tax authority.
READ ALSO:
- Five essential words you need when paying taxes in Denmark
- Denmark releases preliminary 2022 tax returns: Three things taxpayers should look out for
In 2022, taxpayers are advised to particularly check that details relating to any commuting subsidy (kørselsfradrag) are entered correctly.
This is because the relevant information must be entered manually, due to a change introduced due to changes to commuter patterns caused by home working recommendations during the Covid-19 pandemic.
The commuter deduction, termed kørselsfradraget in Danish, is designed to cover the cost of travelling to and from work over a set minimum distance. It applies to rail and car journeys alike.
Commuters can claim the deduction if they travel over 24 kilometres to get to and from work over (12 kilometres each way).
READ ALSO: Denmark’s tax authority considers commuter subsidy over high fuel prices
The tax authority, Skattestyrelsen, registered 40,000 fewer claims for the subsidy between 2019 and 2020, news wire Ritzau reported.
“I think that happened because there were many people who thought it automatically came with the forskudsopgørelse [the preliminary version of the return released in November, ed.],” Henning Boye Hansen, tax specialist and senior consultant with accountancy firm BDO, told Ritzau.
“If there are 40,000 Danes who have forgotten their commuter subsidy on their annual returns, we are talking about 400 million kroner in subsidies that people didn’t get last year,” he said.
The 40,000 may not all have forgotten to input their subsidies – some may no longer qualify for it.
Like with transport, taxpayers can get a deduction for the cost of food and accommodation (such as hotel stays) from your tax bill, if these are incurred when you stay away from home for work – termed kost og logi in the Danish tax system. These subsidies must also be entered in the annual return.
A string of other applicable deductions can also be checked, edited and entered in the annual return. These include (but are not limited to) work equipment (if bought for work use only), unemployment insurance (A-kasse) and union membership fees, and donations to charity.
A deduction for home improvements, the håndværkerfradrag, is to be scrapped after April 1st under the terms of the 2022 budget, but can still be applied up to that date.
Other tax deductions that can be applied for home services, including cleaning and childcare, are retained.
READ ALSO: Four ways to (legally) lower your tax bill in Denmark
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Although Monday is the official day for release of personal tax returns – årsopgørelse in Danish – some of the returns were published on the Skat.dk website from Friday evening.
That resulted in long queues online, with up to half a million people on the tax agency’s website on Saturday morning.
No queues to log in were ongoing as of Monday afternoon.
The årsopgørelse is calculated and displayed on the SKAT website at the beginning of March, after which taxpayers can edit their tax information, such as by changing income or tax exemption information. Details must be updated within a set deadline, which falls at the beginning of May.
Around three out of four taxpayers in Denmark get refunds after the yearly annual return. The amount refunded varies from person to person although many others have to pay money back to the tax authority.
READ ALSO:
- Five essential words you need when paying taxes in Denmark
- Denmark releases preliminary 2022 tax returns: Three things taxpayers should look out for
In 2022, taxpayers are advised to particularly check that details relating to any commuting subsidy (kørselsfradrag) are entered correctly.
This is because the relevant information must be entered manually, due to a change introduced due to changes to commuter patterns caused by home working recommendations during the Covid-19 pandemic.
The commuter deduction, termed kørselsfradraget in Danish, is designed to cover the cost of travelling to and from work over a set minimum distance. It applies to rail and car journeys alike.
Commuters can claim the deduction if they travel over 24 kilometres to get to and from work over (12 kilometres each way).
READ ALSO: Denmark’s tax authority considers commuter subsidy over high fuel prices
The tax authority, Skattestyrelsen, registered 40,000 fewer claims for the subsidy between 2019 and 2020, news wire Ritzau reported.
“I think that happened because there were many people who thought it automatically came with the forskudsopgørelse [the preliminary version of the return released in November, ed.],” Henning Boye Hansen, tax specialist and senior consultant with accountancy firm BDO, told Ritzau.
“If there are 40,000 Danes who have forgotten their commuter subsidy on their annual returns, we are talking about 400 million kroner in subsidies that people didn’t get last year,” he said.
The 40,000 may not all have forgotten to input their subsidies – some may no longer qualify for it.
Like with transport, taxpayers can get a deduction for the cost of food and accommodation (such as hotel stays) from your tax bill, if these are incurred when you stay away from home for work – termed kost og logi in the Danish tax system. These subsidies must also be entered in the annual return.
A string of other applicable deductions can also be checked, edited and entered in the annual return. These include (but are not limited to) work equipment (if bought for work use only), unemployment insurance (A-kasse) and union membership fees, and donations to charity.
A deduction for home improvements, the håndværkerfradrag, is to be scrapped after April 1st under the terms of the 2022 budget, but can still be applied up to that date.
Other tax deductions that can be applied for home services, including cleaning and childcare, are retained.
READ ALSO: Four ways to (legally) lower your tax bill in Denmark
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