Stock income refers to earnings from shares and certain investment fund certificates. This includes both regular returns such as dividends and capital gains or losses when selling shares. Stock income is taxed separately from personal income and capital income.

Stock income follows a progressive tax structure. Income up to DKK 79,400 in 2026 (DKK 158,800 for married couples combined) is taxed at 27%. Any stock income exceeding this threshold is taxed at 42%. Married couples can transfer unused allowances between each other to maximize the benefit of both thresholds.

The acquisition cost includes the purchase price of the shares plus directly related transaction costs. This may include brokerage fees and advisor expenses that can be directly attributed to the specific transaction. These purchase costs are tax-deductible and can be subtracted from the sale proceeds when calculating gains or losses. However, general expenses not directly linked to the purchase cannot be deducted, such as ongoing custody fees, accountant fees for statement preparation, or general investment advisory costs.

Stock taxation generally follows the realization principle, meaning tax is triggered when shares are sold or dividends are paid out. For securities and investment funds subject to mark-to-market taxation, tax is calculated annually based on the market value at year-end.

The realization principle means tax is only imposed when an actual sale occurs, while mark-to-market taxation requires annual taxation of unrealized gains and losses.

Gains and losses are calculated as the difference between the sale proceeds and the acquisition cost, including deductible transaction costs. When the same stock has been purchased multiple times, the average cost method is applied.

The average cost method is used when an investor has purchased the same stock multiple times at different prices. Instead of matching each sale to a specific purchase price, an average acquisition cost per share is calculated based on all purchases. When part of the holding is later sold, this average cost is used to calculate the gain or loss.

If total stock income becomes negative in a year, losses on listed stocks can be carried forward to offset future gains. For listed stocks, losses can only be used to offset future gains on other listed stocks or dividends from them, and the carry-forward happens automatically through the Danish Tax Agency. For unlisted stocks, the rules are more flexible, as losses can be deducted from gains on both listed and unlisted stocks as well as other taxes.

For shares traded on a regulated market such as Nasdaq Copenhagen, gains and losses can be offset against each other, and losses can be carried forward to future years to offset gains or dividends from other listed stocks. For unlisted stocks, the rules differ. Losses can initially be offset against gains on both listed and unlisted stocks. If the loss cannot be fully utilized, it can be deducted from other taxes, including base tax and top-bracket tax. If the loss still cannot be fully used, the remaining amount can be carried forward to future income years. This represents a significant difference between the rules for listed and unlisted stocks, particularly regarding carry-forward options.

In principle, Danish and foreign shares are taxed under the same stock income rules, but practical differences can arise. For foreign shares, withholding tax is often deducted in the country where the company is domiciled, typically when dividends are paid. This foreign tax can be credited against Danish stock tax to some extent, depending on the provisions in any applicable double taxation treaty.

Danish banks and custodians automatically report information about purchases, sales, and dividends to the Danish Tax Agency, so these items generally appear on the annual tax assessment. However, it remains the investor's responsibility to verify that the information is correct and that all gains and losses are included. If you have foreign custodians or trade through foreign platforms, automatic reporting to the Danish Tax Agency generally does not occur. In such cases, the information must be entered manually, and failure to report can result in tax consequences, including back taxes and potential fines.

The acquisition cost for shares held in foreign custodians must be reported to the Danish Tax Agency by the reporting deadline of July 1 in the year following the income year. If the acquisition cost is not reported on time, the taxpayer loses the right to deduct any potential loss.

If a person moves from Denmark while owning shares with a total market value of at least DKK 100,000, the so-called exit tax rules in the Capital Gains Tax Act are triggered. This means unrealized gains on the shares are deemed realized for tax purposes on the departure date, and tax is calculated on the deemed gain.

However, it is possible to obtain deferral of the tax payment, provided you meet the conditions and submit the annual form (currently form 04.065) to the Danish Tax Agency. The deferral means the tax only becomes due when the shares are actually sold. This arrangement is only available if you have been fully taxable in Denmark for at least seven years within the ten years prior to departure.

Tax on stock income can be optimized through strategic planning of realization timing and use of special schemes. One strategy is to spread share sales across multiple income years to prevent stock income from exceeding the progression threshold and triggering the higher tax rate. It can also be advantageous to use a stock savings account for eligible shares, as income in the account is taxed at a fixed low rate instead of the progressive rates.

Loss utilization is an essential part of optimization. Deliberately realizing a loss can offset other gains in the same year, reducing total tax liability. The choice of realization timing can therefore be highly significant, especially when the portfolio includes both gains and losses. Finally, currency fluctuations, brokerage fees, and other transaction costs should be factored into planning, as these elements affect the calculation of taxable gains or deductible losses.