Statistical presentation

Data description

The statistics provide data about calculated personal income and capital gains and their taxation at the time of the final assessment of the income year. The statistics give information about tax bases, tax calculations and the various tax concepts. The statistics contains an inventory of provisional and final tax. The provisional tax, or the tax at source, is a pay-as-you-earn tax, that is, it is paid as the income is earned. After the end of the income year the year-end balance sheet is completed and based on this the final tax is calculated. The difference between the provisional and final tax is either due to underpayment (final tax is higher than the provisional tax) or overpayment (final tax is lower than the provisional tax).

A complete overview of the relations between different income and deduction concepts concerning personal income tax is shown.

Most of the data is available in municipal and regional breakdowns. However, for some taxes, i.e. estate duty, the breakdown is not an option as data is only available at aggregate level. In the regional overview, be aware that the current regions are not able to levy taxes, in contrast to their administrative predecessors - the counties.

Classification system

These statistics are group by type of tax. Geographically these statistics are grouped by regions and municipalities.

Sector coverage

Not relevant for these statistics.

Statistical concepts and definitions

Share tax: Share tax is calculated from the share income. If the income from shares is below a graduated limit, then the final tax is 27 pct. Is the income from share above a graduated limit, then a tax of 42 pct. is used for the income amount above the graduated limit, which is a part of the final assessment. The dividends tax which is a part of the dividends according to the Danish Withholding Tax Act § 65 is offset against the final tax accordingly to the Danish Withholding Tax Act § 67. The unexploited part of the threshold can be transferred to the spouse.

Labour market contributions: Employees contributions to the labour market fund is calculated from the gross pay. Gross pay consists of monetary remuneration which includes salary, holiday allowance etc., as well as the taxable value of employee benefits, which is A-income. Labour market contribution is also paid from ATP contribution as well as the share of the salary that the employer detains and paid into a pension scheme.

Limited tax liability: Limited tax liability is for people without residence in Denmark provided that they either have income from working, in possession of a property or be self-employed in Denmark. The limited tax liability implies that only certain incomes are taxable. The main principal is that every income which stem from activities or sources in Denmark are taxed.

Capital income: Covers e.g. interest received and interest paid.

Income tax for foreign scientists: Recruited researchers and other highly paid employees from outside Denmark can choose to be taxed under a special Danish tax scheme, called tax scheme for researchers ('forskerordningen'). The special scheme yields that a person will pay gross tax plus labour market contribution of their salary for up to 7 years. However, if a person decided to pay taxes based on the scheme, then they are not entitled to tax deductions or allowance of any kind.

Full tax liability: Fully liable to taxation is defined as people with residence in Denmark. People with foreign residence, who have had residence in Denmark within the last four years, are also fully liable to taxation unless they pay personal income tax in another country and that the paid tax is not evidently less restrictive than the Danish tax. This regulation also applies for Greenland and the Faroe Islands. The full tax liability also encompasses people who have stayed at least six months consecutively in Denmark, but do not have residency in the country. For course participants and students, full tax liability first occurs after 365 days within a 2-year period. Finally, for Danish citizens who by the government serves overseas are also fully liable to taxation in Denmark.

Compensation for senior allowance: Senior allowance is a abatement of the income tax by repaying a share of the paid labour market contribution. It is only possible to receive this compensation if one have reached the age of 64 in the period from 2010 to 2016 and in addition fulfills other requirements mentioned in the law. The calculated abatement is included in the computation of the final tax.

Compensation for higher green taxes (‘green cheque’): The tax-free compensation - "green check" - was introduced because of the increased energy taxes. The compensation consists by an amount pr. person, who have reached the age of 18 and another amount for children under the age of 18. The child amount is received for either one or two children. The compensation declines for people with income over a certain amount.

Income deductions: Covers e.g. unemployment insurance, mileage allowance, and alimony, maintenance

Church tax: Church tax is a proportional tax is collected under the law about the economy regarding the Evangelical Lutheran Church in Denmark. The tax is paid by who are a member of the Evangelical Lutheran Church in Denmark.

Municipal tax: The municipality tax is in principal proportional and the local municipality determines the tax rate. The local government income tax is the taxable income minus income tax reliefs.

Personal income: Covers all income that is part of the taxable income and which is not capital income (e.g. A-income, surplus on self-employment, foreign income as well as other deductions in the personal income: labour market contributions and contributions for pension schemes with lump sum disbursement)

Share income: Covers the income of shares beyond the lower limit for increased taxation of dividend of shares

Person liable to taxation: Fully liable to taxation is defined as people with residence in Denmark. People with foreign residence, who have had residence in Denmark within the last four years, are also fully liable to taxation unless they pay personal income tax in another country and that the paid tax is evidently less loose than the Danish tax. This regulation also applies for Greenland and the Faroe Islands. The full tax liability also encompasses people who have stayed at least six months consecutively in Denmark, but do not have residency in the country. For course participants and students, full tax liability first occurs after 365 days within a 2-year period. Finally, for Danish citizens who by the government serves overseas are fully liable to taxation in Denmark.

Central government tax: Central government tax consists of ordinary income tax (lower limit), additional income tax (upper limit), and equalization tax. Ordinary income tax (lower limit) and additional income tax (upper limit) is calculated from the personal income tax, where payment to pension schemes with lump sum disbursements cannot be deducted. From 2011 to 2017, the equalization tax was added to large pension payouts over a boundary. The tax is also called state tax.

Healthcare contribution: A healthcare contribution was introduced in connection with the municipality reform i 2007. The contribution is paid from the taxable taxable income minus personal allowance. The scheme expired in 2019.

Taxable income: Is defined as personal income plus capital income minus income deductions

Corporation tax: There are two options for self-employed persons when choosing taxation for the corporation. The taxation can either be a part of the regular personal income taxation or register as a business arrangement ('Virksomhedsordningen'), which makes it possible to be taxed based corporation-liked terms.

Imputed income tax from owner-occupied dwelling: A tax which is calculated from the value of the property. The tax calculation is based on the lowest value of 1) the property value in 2001 added 5 pct., 2) the property value in 2002 or 3) the property value in the current income year.

Statistical unit

The unit is the individual person.

Statistical population

All persons above 15 years who are liable to taxation

Reference area

Cover individuals who are fully liable to taxation (Fuld skattepligt) in Denmark even if they don't have Danish residency.

Time coverage

The statistics cover the period from 1903.

Base period

Not relevant for these statistics.

Unit of measure

DKK millions.

Reference period

The calendar year.

Frequency of dissemination

Annual.

Legal acts and other agreements

The legal authority to collect data is provided by section 8 of the Act on Statistics Denmark.

The statistics fall under Council Regulation 2223/1996 on national and regional accounts, Council Regulation 2516/2000 on common principles of the European system of national and regional accounts in the Community (ESA 95) as concerns taxes and social contributions, Commission Regulation 995/2001.

Cost and burden

There is no direct response burden since the data are collected for other purposes.

Comment

Further information can be found at the Subject page for these statistics, or by contacting Statistics Denmark directly.