The expat tax scheme allows newly arrived researchers and highly paid key employees to be taxed at a fixed low gross tax rate of approx. 32.8% on their salary from a Danish employer for a limited period.

The scheme is introduced to attract and retain international talent. For the employee, this means that salary is taxed at a fixed rate, while other income – for example capital income and share income – continues to be taxed under the ordinary rules.

The expat tax scheme can be used by two main groups:

• Researchers: Approval from the Independent Research Fund Denmark. No minimum salary requirement.
• Highly paid key employees: Average monthly salary of at least DKK 78,000 in 2025, before labour market contribution and ATP, guaranteed in the employment contract.

In addition, a number of general conditions must be met to enter the scheme and to keep it during the employment.

Typical general conditions include:

• No recent full tax residence or certain limited tax liability in Denmark in a defined period prior to employment.
• Employment with a Danish employer or a foreign employer with a permanent establishment in Denmark.
• The employee must not have controlling influence in the employer company.
• The scheme must be chosen from the start of the employment, and reporting to eIndkomst must be correct from the first salary payment.
• The employee must be fully tax resident in Denmark while using the scheme.

The detailed conditions are technical, and a concrete assessment is often necessary.

Effective tax rate: approx. 32.8%.

The tax is 27% of A-income after labour market contribution, which corresponds to an effective rate of approx. 32.8% of gross income.

Duration: The scheme can be used for up to 84 months (7 years), possibly spread over several employments, as long as the conditions are continuously met.

The scheme covers:

• Cash salary and A-income from the Danish employer
• Holiday pay
• Certain fringe benefits, such as company car and phone

The scheme does not cover:

• Benefits in kind that are treated as B-income, including free housing
• Other B-income
• Capital income and share income – these are taxed under the ordinary rules

It is therefore important to structure salary and benefits correctly if you want to use the scheme optimally.

Application is submitted digitally and can be filed by the employer, the employee or an advisor.

For researchers, the approval from the Independent Research Fund Denmark must be in place no later than one month after the start of the employment.

It is important that salary and employment terms are correctly set from the beginning, that the salary requirement for key employees is met on an ongoing basis, and that reporting to eIndkomst is correct from the first salary payment.

Typical pitfalls include:

• The salary requirement is not met in one or more months (for example due to unpaid leave, reduced hours or incorrect bonus structure).
• The employee has had previous Danish tax liability that blocks access to the scheme.
• The employee has controlling influence in the employer company.
• Incorrect or late reporting to eIndkomst.
• Longer stays abroad that change tax residence or break the conditions for the scheme.

Because the scheme is formalistic, even small errors can have major consequences. It is therefore important to plan the employment and salary structure carefully and follow up continuously.

You can read more about the expat tax scheme and SkatteInform’s advisory services here:

SkatteInform – Expat tax scheme

SkatteInform can assist you with:

• Assessing whether you or your employees can use the expat tax scheme
• Structuring salary and employment terms so that the conditions are met
• Preparing and submitting applications and documentation
• Ongoing control of salary level and reporting, so the scheme is not lost
• Advising on relocations, international assignments and cross-border tax issues in connection with the scheme