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Denmark opposition wants tax deductions for first-time home buyers 

Denmark’s Liberal (Venstre) party, the largest opposition party, says it wants to make home ownership more affordable in Denmark. 

Denmark opposition wants tax deductions for first-time home buyers 
Denmark's opposition Liberal party wants to help first time buyers get on the property ladder by offering tax cuts on savings. File photo: Thomas Lekfeldt/Ritzau Scanpix

Under the proposal, first-time home buyers could be given tax deductions on savings set aside for buying a home, newspaper Berlingske reports.

Specifically, would-be homeowners could receive a 20 percent tax reduction on up to 50,000 kroner per year for five years, according to the Liberal plan, which the party is set to present on Monday.

As such, a couple which together saved 500,000 kroner over a five-year period would get a benefit of 100,000 kroner under the proposed tax deduction.

In addition to the tax plan, the Liberals want to spend 100 million kroner yearly building housing, with 122,000 new homes for buyers planned over the next ten years. Municipalities would be given incentives to build more homes with shorter processing times under the scheme.

The Liberals estimate that the savings scheme for first-time buyers would be used by around 50,000 people per year and therefore cost around 1 billion kroner annually.

READ MORE: Danish apartment sales cool to eight-year low  

A reform of job centres and municipal employment services, which the Liberals will also present in the near future, would help to save money which could be spent on the home ownership plan, party leader Jakob Ellemann-Jenses also said in the Berlingske interview.

The Liberals party count with the support of the Conservatives and the Danish People’s Party, although the former party is reported to favour broader tax cuts.

The Social Democratic government opposes the plan. Housing minister Christian Rabjerg Madsen told Berlingske that the proposal would push up house prices in larger cities, forcing people on normal incomes to move away from larger population centres.

Member comments

  1. hi it would be cool that you link the DR article that talks about the same so i could consume the info in both languages.

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MONEY

Exchange rate: What are your options if you live in Denmark but have income in pound sterling?

The value of the British pound has fallen steeply against the dollar in recent days but also against the Euro – and the krone. So what should you do if you live in Denmark but have income – such as a pension, rental income or a salary – in pound sterling?

Exchange rate: What are your options if you live in Denmark but have income in pound sterling?

Exchange rates might sound like a spectacularly dull topic, but if you live in Denmark (where, naturally, your day-to-day living expenses are paid in kroner) but have income from the UK in pounds, then the movement of the international currency markets will have a major impact on the money that ends up in your pocket.

This is not an uncommon situation – Denmark-based Brits may work remotely as freelancers from British companies and be paid for invoices in pounds, while retired Brits might be receiving a British pension.

Others might have income from rental properties or investments.

So a big loss in the value of the pound against the euro – and by extension, the krone – can have a major impact on Brits in Denmark.

The most recent fall in the value of the pound was sparked by the UK government’s new mini budget and has already seen a relative recovery. 

The pound-krone exchange rate over the last month. Chart: xe.com
 
 
But while this one-time fall is spectacular, it’s also part of a longer term trend in the fall of the value of the pound, especially since Brexit, that has seen people such as foreign-based pensioners lose a big chunk of their income.
The pound-krone exchange rate over the last 10 years. Graph: xe.com

So if you have income in pounds, what are your options?

Income in kroner – obviously this isn’t an option for everyone, especially pensioners, but the best way to protect against currency exchange shocks is to make sure that you’re paid in the same currency that you spend in.

Alternatively, income in euros: the advantage of the euro in Denmark is that its value is pegged to the krone and not sensitive to exchange rate fluctuations.

For those being paid from abroad, billing in euros means you could work in any EU country – including the anglophone ones like Ireland – and get your salary in euros.

Depending on your employer, it might also be possible for you to ask to bill in euros. 

Work in Denmark – if you’re currently not working or want to switch to local currency income, then an obvious option is to take up some work in Denmark.

Depending on your work and residency status, as well as the field you work, the practicality of this option ranges wildly from one person to the next.

READ ALSO: How can you get a work permit in Denmark if you are not an EU national?

Exchange rate – if your income can only be paid in pounds, it’s crucial to ensure that you get the best exchange rate possible and that you don’t waste money on international transfer fees.

The best options here are online banks or money transfer services, which compete on the rates that they offer, so usually have the most advantageous rate.

Some online banks also have the option to set up accounts in both pounds and kroner, so that you can receive money in pounds and spend it in kroner without having to make bank transfers, which can attract fees.

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