READER QUESTION: Do I have to pay tax in Denmark if I work remotely for a foreign company?
Foreign residents in Denmark sometimes get the opportunity to work remotely for a company in another country. How does this affect their tax obligations?
Reader question: I’m a British national who can qualify for a residence and work permit in Denmark as the family member of an EU citizen. I currently have a full-time job with a company in the UK which I can do 100 percent from home. I’d like to keep this job and move to Denmark with my partner, but will I then have to pay tax in Denmark instead of the UK?
The short answer to this question is yes, but there are some factors that should be considered, the Danish Tax Agency (Skattestyrelsen) told The Local via email on September 11th.
“If a person is resident in Denmark, that person is fully obligated to pay tax in Denmark and will be taxed based on their full income, regardless of where it comes from,” the agency said.
READ ALSO: Digital nomads: Who can work remotely in Denmark?
“That also applies if the person resident in Denmark only carries out work in Denmark for an employer in the United Kingdom. In that situation, the income will be taxed only in Denmark and the United Kingdom, due to its double tax treaty with Denmark, may not collect tax,” it said.
You can check whether a country has a double tax treaty with Denmark on the Danish Tax Ministry’s website.
Different rules can apply to people who are employed as public servants by authorities in other countries, and who work and live in Denmark, the agency noted.
If the work is actually conducted abroad – as opposed to remotely from Denmark – the income will be taxed “both in Denmark and abroad, with Denmark then giving a deduction for the foreign tax paid,” the Tax Agency said.
“If a person meanwhile works abroad for a Danish or foreign employer for at least six months and is not in Denmark for more than 42 days during this period, that person can choose to use a rule in the [tax] equivalence law [Danish: ligningsloven, ed.] paragraph 33A,” the agency added.
This rule “provides for the foreign income not to be taxed in Denmark”, it said.
Additional information on foreign income for people who live in Denmark can be found (in Danish) on the Tax Agency’s website.
Do you have any additional questions on this topic? Let us know.
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Reader question: I’m a British national who can qualify for a residence and work permit in Denmark as the family member of an EU citizen. I currently have a full-time job with a company in the UK which I can do 100 percent from home. I’d like to keep this job and move to Denmark with my partner, but will I then have to pay tax in Denmark instead of the UK?
The short answer to this question is yes, but there are some factors that should be considered, the Danish Tax Agency (Skattestyrelsen) told The Local via email on September 11th.
“If a person is resident in Denmark, that person is fully obligated to pay tax in Denmark and will be taxed based on their full income, regardless of where it comes from,” the agency said.
READ ALSO: Digital nomads: Who can work remotely in Denmark?
“That also applies if the person resident in Denmark only carries out work in Denmark for an employer in the United Kingdom. In that situation, the income will be taxed only in Denmark and the United Kingdom, due to its double tax treaty with Denmark, may not collect tax,” it said.
You can check whether a country has a double tax treaty with Denmark on the Danish Tax Ministry’s website.
Different rules can apply to people who are employed as public servants by authorities in other countries, and who work and live in Denmark, the agency noted.
If the work is actually conducted abroad – as opposed to remotely from Denmark – the income will be taxed “both in Denmark and abroad, with Denmark then giving a deduction for the foreign tax paid,” the Tax Agency said.
“If a person meanwhile works abroad for a Danish or foreign employer for at least six months and is not in Denmark for more than 42 days during this period, that person can choose to use a rule in the [tax] equivalence law [Danish: ligningsloven, ed.] paragraph 33A,” the agency added.
This rule “provides for the foreign income not to be taxed in Denmark”, it said.
Additional information on foreign income for people who live in Denmark can be found (in Danish) on the Tax Agency’s website.
Do you have any additional questions on this topic? Let us know.
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