Denmark’s tax authority to release annual returns on March 13th

The årsopgørelse or annual tax return will be released by the Danish Tax Authority, Skattestyrelsen, on March 13th this year, meaning taxpayers will be able to check whether they are due money back from their contributions in 2022.

Denmark’s tax authority to release annual returns on March 13th
People keen to see whether they are due Danish tax back - or have not paid enough - should note March 13th in their diaries this year. File photo: Sarah Christine Nørgaard/BT/Ritzau Scanpix

The date for this year’s publication of the årsopgørelse or annual tax return was confirmed by the tax agency on Thursday.

Tax rebates, where due, will be paid into the accounts of taxpayers from April 14th. Last year saw around 19.9 billion kroner in excess contributions returned to some 3.7 people across the country.

Conversely, around 8.4 billion kroner was demanded from people who were found to have underpaid in income tax for the previous year.

The årsopgørelse is calculated and displayed on the website in March every year.

Around three out of four taxpayers in Denmark usually get refunds after the yearly annual return. The amount refunded varies from person to person although many others must pay money back to the tax authority.

After it is published, taxpayers can edit their tax information, such as by changing income, mortgage or deduction information. Details must be updated within a set deadline, which falls at the beginning of May.

READ ALSO: Årsopgørelse: What you need to know about Denmark’s annual tax return

As such, while the release date is often looked forward to by those expecting to be due money back, it should also be seen as an important occasion on which to check all your tax information is correct, Danish Tax Authority department director Jan Møller Mikkelsen underlined in comments to news wire Ritzau.

“We experience huge interest in seeing whether this year’s number is green or red,” Mikkelsen said.

“But spend a moment too on checking all information has been correctly included or if anything has been left out. We get a lot of information automatically but there might be details you need to enter yourself to make sure you pay the right tax,” he said.

Although the official opening day is March 13th, Skat often releases its returns, or some of them, on the Friday preceding the announced date. This is not certain to be the case in 2023.

The tax authority is currently reviewing millions of pieces of information from employers, banks and trade unions among other organisations. The information forms the basis of the annual return.

From the day of publication, the annual tax return can be viewed (and information corrected) by visiting the Skat website and signing in with MitID.

The agency can also be contacted over the phone or in writing for guidance on the return and other tax matters.

The final deadline to correct or change information is May 1st. People who owe money to the tax authority must pay it by July 3rd to avoid paying interest on the amount.

READ ALSO: Why it pays to check your Danish preliminary tax return in January

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Danish government accused of breaking promises on tax cuts

Critics of the Danish government say it is failing to meet promises on tax cuts made in the coalition policy agreement because of a plan to apply a special tax to energy firms and use it to assist individuals struggling with high living costs.

Danish government accused of breaking promises on tax cuts

The criticism has emerged from the recent announcement that energy companies are to be required to pay a special tax contribution totalling 1.2 billion kroner due to additional revenues resulting from the energy crisis. The special tax is connected to an EU measure aimed at relieving high energy prices for consumers.

The money will be spent by the state on support for members of the public who are struggling with costs caused by inflation. This will funnel it back to consumers, the government argues.

READ ALSO: Danish energy companies ordered to return 1.2 billion kroner

“That is not what you would normally think to be a tax freeze,” economy professor Bo Sandemann Rasmussen of Aarhus University said in comments to newspaper Berlingske.

In December’s coalition policy agreement, the government states that its tax policies will be “be based on tax freeze” (skattestop).

The term skattestop has been a key part of tax policy within the Liberal (Venstre) party, one of the two junior partners in the coalition, for over two decades.

The government suggested it will use a fund of 300 million kroner previously set aside for a temporary subsidy for vulnerable families in order to meet its tax promises.

It also wants to give inflation-related tax-free cash payments to low-income senior citizens who receive the ældrecheck welfare benefit.

READ ALSO: KEY POINTS: What are the main policies of the new Danish government?

But these plans do not fit with a “tax freeze” in the traditional sense, Rasmussen said to Berlingske.

“Normally you would say this [a tax freeze] should happen within the tax system. In other words, via either direct taxation of people’s incomes or through indirect taxes like VAT,” he said.

In September, the European Commission asked member countries to implement plans to cap to energy company profits. These, as well as levy collections from fossil energy companies, were expected to raise 140 billion euros.

The policy was a key element of the Commission’s measures to relieve high energy prices for consumers.

Tax Minister Jeppe Bruus noted in a comment that the EU had required the Danish government to apply a special tax, news wire Ritzau writes.

“This is therefore a proposal that is the consequence of a regulation that took effect before the new government was in place,” Bruus said.

“The policies the government has presented mean, overall, that taxes will be considerably reduced,” he stated.

Negotiations with other parties could determine the way in which the money regained from energy companies is spent – and therefore whether it takes the character of tax cuts.

The Liberals said they stand by their “tax freeze” principle.

“We naturally stand by the tax freeze and want to reduce tax by billions for both Danes and Danish companies. The EU has – before the coalition was formed – required Denmark to implement [caps on energy companies],” Liberal tax spokesperson Jan E. Jørgensen said in a written comment.

“At the same time, there are a number of criteria from the EU on what the proceeds from these measures can be used for and what they may not be used for,” he added.

The libertarian thinktank Cepos accused the government of breaking promises to reduce tax and rejected its argument relating to the EU regulation.

“According to the tax ministry, the proceeds from tax increases [on energy companies] can go to things like measures to relieve the consequences of high electricity prices for consumers,” Cepos senior economist Mads Lundby Hansen told Ritzau.

“Lower electricity taxes reduce electricity prices, so I therefore see no obstacle to the government, for example, reducing the electricity tax and thereby complying with its tax freeze,” he said.