Property tax is a tax imposed on owners of real estate, such as homes. It can include property tax, which is calculated based on the value of the property, as well as any other taxes and charges associated with ownership and use of the property, such as land debt and property value tax.
Frequently Asked Questions About Housing Tax
What is housing tax?
Housing tax consists of two main components: property value tax and land tax.
Property value tax is a tax on the total value of the home when the home is available to the owner as a residence. Land tax is calculated based on the value of the land in its undeveloped state.
Municipalities still have the responsibility for setting the per mille rate, but from 2024, land tax is regulated and collected together with property value tax through the Danish Tax Agency (Skattestyrelsen).
How is housing tax calculated?
From 2024, both property value tax and land tax are calculated based on the official property valuation, where 20% is automatically deducted as a precautionary principle.
Property value tax amounts to 0.51% of the tax base up to DKK 9.2 million and 1.40% of the portion exceeding this. Land tax is calculated based on the land value (the value of the land in its undeveloped state) after deducting 20%.
Although municipalities still have the responsibility for setting the per mille rate for land tax, this now happens within state frameworks. The new ceiling and regulation rules mean that municipalities cannot raise the per mille rate indefinitely, and that any increases in housing tax occur gradually to avoid sudden increases for homeowners.
What are the new housing tax rules from 2024?
The new rules came into force on January 1, 2024. They mean that property value tax and land tax are collected together through the preliminary and annual tax assessments, instead of land tax being paid separately to the municipality.
The tax base is determined based on the latest official property valuation, where 20 percent is deducted as mentioned. At the same time, a number of transitional arrangements have been introduced – including a tax discount and a freezing scheme – to ensure that the transition to the new system does not result in unforeseen financial burdens for homeowners.
Housing tax is included in the total tax payment, and the preliminary tax assessment must reflect correctly calculated land tax and property value tax.
What is the housing tax discount?
The tax discount ensures that homeowners do not pay more in total housing tax in 2024 than they would have under the old rules.
To receive the discount, the home must have been acquired no later than December 31, 2023, and the owner must be liable to property value tax and/or land tax in 2024.
The discount follows the property and not the person, and therefore only applies as long as the current owner retains ownership. If the property is sold, the discount lapses, and the new owner is taxed according to the ordinary rules. This means that buyers who acquire a property after December 31, 2023, are not covered by the discount scheme.
What is the freezing scheme for housing tax?
The freezing scheme is an option for homeowners who experience an increase in housing tax as a result of the new rules. The scheme provides the right to postpone payment of the increase – that is, the difference between the previous housing tax and the new one – as a loan from the state.
The loan must first be repaid when the property is sold, or if the owner wishes to settle it earlier. You must decide by December 31, 2025 at the latest whether you want to use the loan scheme for 2025.
The purpose is to create security and liquidity for homeowners, so that the transition to the new system does not lead to disproportionately large expenses. Previously, a municipal freezing scheme existed in the period 2018-2023, but from 2024, the scheme has been taken over by the state and made permanent.
How is housing tax calculated for 2024?
Housing tax for 2024 is calculated based on the latest official property valuation, which for most homes is the 2022 valuation. This valuation is called preliminary because it can be adjusted until the Valuation Agency (Vurderingsstyrelsen) completes the final valuation of the property.
When the final valuation is available, the Danish Tax Agency will automatically adjust the housing tax retrospectively, so that the preliminary and annual tax assessments reflect the final figures.
Where can I see my housing tax?
Homeowners can follow their housing tax on skat.dk under TastSelv, where both the preliminary and annual tax assessments show the total amounts for property value tax and land tax.
The official property valuation can be found on the Valuation Agency's website, where you can see the valuation basis, any changes, and the value on which the tax is calculated.
It is important to ensure that information about ownership, property type, and land area is correct, as they form the basis for calculating housing tax.
What can I do if I disagree with the property valuation?
If you disagree with the property valuation, you can submit an objection to the Valuation Agency when you receive the valuation notice. The objection must normally be submitted within the specified deadline, which appears in the notice.
It is recommended to review the valuation thoroughly and compare the information with the BBR register (Building and Housing Register), as the valuation depends on, among other things, the property's area, use, and the size of the land.
If there are errors in the BBR, you should contact the municipality to have the information corrected, as it forms the basis for the valuation and thus also for the housing tax.
Disclaimer
As the above is for guidance purposes only, we accept no liability for decisions that may be made based on the above without prior individual advice. We accept no liability for errors and omissions.