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International Introduction Tax Issues for Foreigners at Aarhus University
Autumn 2013
SKAT, Markedsføring, Aarhus
International Introduction
Programme - topics
Ordinary tax system
Preliminary income assessment
Income tax return
Annual tax assessment notice
Tax on the internet - www.skat.dk
Side 2
International Introduction
International Citizen Service
International Citizen Service West Nordhavnsgade 4-6 8000 Aarhus C
Phone: +45 72 22 33 75 Mail: [email protected]
Opening hours: Thursday 1 p.m. – 5 p.m. and Friday 9 a.m. – 1 p.m.
Get off to a good start in Denmark – all the service you need in one place!
Side 4
International Introduction
Who pays tax in Denmark ?
• Any person living in Denmark must pay tax in Denmark - full tax liability.
• Any person working – but not living - in Denmark must pay some tax (on wages, salary etc.) – limited tax liability.
International Introduction
Side 5
International Introduction
Your tax status in Denmark
If you have been working at Aarhus University for more than six months, you will be subject to full tax liability.
You will be taxed on your global income.
A tax agreement to avoid double taxation between Denmark and your home country may regulate the tax to be paid.
International Introduction
Side 6
International Introduction
Your information to SKAT at arrival
You have to send this to SKAT:
Form no. 04.063 E
Copy of your letter of employment.
International Introduction
Side 7
International Introduction
You will receive a preliminary tax assessment from SKAT right away when getting a CPR-nummer (civil registration no.). Whenever you submit corrections to SKAT during the year about your current income you will receive a new preliminary tax assessment . In November you will automatically get an preliminary assessment for next year.
Check it! You must do this yourself.
Please inform SKAT of your global (foreign + Danish) income, i.e. interest from bank accounts, every year.
You can submit the information via E-tax (SKAT’s self-service facility – TastSelv) at www.skat.dk
Paying tax in Denmark – preliminarily
International Introduction
Side 9
International Introduction
Side 10
Paying tax in Denmark - tax assessment
The Danish tax year runs from 1 January to 31 December.
In March you will receive a tax assessment notice for the previous year.
The tax assessment notice contains information about your income and deductions etc. and taxes paid on income from the previous year and information from your employer, banks etc.
You can view your tax assessment notice for 2013 in your tax folder via E-tax (TastSelv) at www.skat.dk.
International Introduction
Important dates during the tax year
Tax during
the year
Submitting
the tax
return for
ordinary
taxation –
no later
than May
1st.
Submit information
regarding your
preliminary income
assessment tax
card for the next
year.
Submitting the tax
return only for those
of you who have
foreign income or
income from your
own company - no
later than July 1st.
Side 11
International Introduction
As an ordinary taxpayer in Denmark you have to inform SKAT of your foreign income or foreign property – every year.
Danish income like salary, interest, etc. is automatically put on your
tax assessment notice.
You can apply for tax deductions like any other Danish taxpayer.
Paying tax in Denmark
Side 12
International Introduction
Employees taxed in Denmark on salary are allowed certain tax deductions/allowances:
• You are allowed to earn DKK 43,000 before your start paying tax (this is known as your personal allowance (personfradrag)
• Special employment allowance up to DKK 22,300
• Deduction for transport between home and work - if more than 24 km a day – no matter whether you have got any expenses or not
• Interest payments - both Danish and foreign
• Pension scheme contributions - made by you
• Contributions to unemployment fund and trade union membership
• Deduction for meals and accommodation expenses, under certain conditions, during travelling.
Tax deductions/allowances in Denmark
International Introduction
Side 13
International Introduction
Deduction for transport
Transport between home and work :
Rates for 2013: Rates for 2014:
0 - 24 km No deduction No deduction 25 - 120 km DKK 2.13 per km (do not know yet) 121 km - DKK 1.07 per km (do not know yet)
International Introduction
Side 14
International Introduction
Tax and pensions schemes
You can take your foreign pension scheme with you to Denmark and get a tax deduction.
For more information, you need to contact SKAT, who must approve your pension scheme.
You must submit form no. 07.055E for SKAT’s approval.
Side 15
International Introduction
If sent out by their employer employees may apply for the following tax deductions during the travel:
- up to a maximum of DKK 25,000.
The deduction for food is only allowed for the first 12 months.
The deduction for accommodation can be allowed for up to 24 months.
Please note that you have to meet certain conditions in order to get the deductions.
Deduction for food and accommodation expenses
International Introduction
Food: DKK 455 per day (24 hours)
Accommodation: DKK 195 per day (24 hours)
Side 16
International Introduction
Forskudsopgørelse – Preliminary income assessment – tax card
1 Your salary after deduction of labour market contributions (AM-bidrag)
2 Total provisional tax calculated for the year
3 Total preliminary labour market contributions calculated at the rate of 8%
4 The tax per cent that will be deducted from your salary
5 Your monthly tax-free amount
1
2
3
4 5
Side 17
International Introduction
Calculation Your salary
Monthly salary after deduction
of pension contributions DKK 33,971 DKK 33,971
Labour market contributions at 8% DKK -2,718 DKK -2,718
Salary after deduction of labour market contributions DKK 31,253
Deductions as stated on your tax card DKK -8,232
Salary to be taxed at the rate of 37% DKK 23,021
Tax deducted (A-skat) at the rate of 37% DKK -8,518 DKK -8,518
You will receive DKK 22,735
Monthly salary and tax deduction
International Introduction
Side 18
International Introduction
You will probably receive a tax assessment notice from SKAT automatically
CHECK IT – You are obliged to do so!
If it is incorrect, please submit the right information to SKAT.
The self-service site at www.skat.dk opens in March.
Tax assessment notice
International Introduction
Side 19
International Introduction
Side 21
If you have had :
• income from your own business (are self-employed)
• foreign income from employment or securities abroad
• income from rental property
- then you have to submit an income tax return for 2013.
You can download a tax return for foreign income on www.skat.dk,
Form no. 04.012.
Please note there are different forms – depending on whether you have
had foreign income or not.
Tax return for the tax assessment
International Introduction
Income from abroad – form no. 04.012 E
If you have any income from abroad while staying in Denmark, and you are subject to full tax liability in Denmark, you also have to submit form no. 04.012 E - The tax return for foreign income.
Side 22
International Introduction
Property abroad – form no. 04.053 EN
You also have to submit the form 04.053 if you own a property abroad
Side 23
International Introduction
Tastselv – how to check your tax information
International Introduction
Side 26
International Introduction
In the tax folder you will find:
• Your preliminary income assessment and tax assessment notice in PDF format. The latest will always be the "current“, but you can also view the previous one as well as other records.
• Information reported to SKAT by your employers, banks, pension funds, etc.
• Current salary and e-tax card; you can see information about your payslips and which employer uses your tax card.
• A "log" which is a summary of the entries you or SKAT have made in E-tax.
• Information about your property.
Side 28
International Introduction
Side 29
Advantages of using E-tax (TastSelv)
If you have any changes to your tax assessment notice, you can use E-tax at skat.dk.
There you can
• view your new tax assessment notice right away – and print it if you like.
• click on the text for each box to see detailed information about your income, deductions etc.
• print any of your tax assessment notices from the tax folder. The version you print yourself is identical to the one SKAT sends you and is valid in exactly the same way.
International Introduction
Side 30
Overpaid tax (NemKonto)
If you have paid too much tax, you will (nearly at the same time as you receive your tax assessment notice in March) get a tax refund transferred to your Nem-konto.
You will get a tax-free interest of 0.5% of the amount.
The tax refund will be paid to your NemKonto in March.
International Introduction
Overpaid tax (foreign banks)
If your tax assessment notice states that you have paid too much tax, and if you do not have a Danish NemKonto, please inform SKAT of your IBAN number and SWIFT/BIC code as well as your Danish civil registration number (CPR) by e-mail.
Please note that it may take up to 90 days before the tax refund is credited your foreign account.
Side 31
International Introduction
Side 32
Overpaid tax
Payment of overpaid tax if you have left Denmark:
SKAT calculates your tax and makes a tax assessment notice for you on the basis of the information SKAT has received about your income. But SKAT very often does not have information about the date you left Denmark, and therefore the tax calculation is carried out on the assumption that you are tax liable for the entire year.
In many cases this assessment is incorrect, and SKAT therefore retains any overpaid tax until you have informed us about when you left Denmark for good.
International Introduction
Side 33
Underpaid tax
Pay the rest of your tax in time and save money!
• Until 1 July you must pay a day-to-day interest of 2.7%.
• After 1 July, you must pay an interest of 4.7%.
International Introduction
Side 34
Day-to-day interest (underpaid tax)
Example of calculation of interest (before 1 July):
Thomas Jensen has paid too little tax: DKK15,000.
At the end of March, he chooses to pay the tax on 31 March.
He must pay interest for 91 days (from 1 January to 1 April) as follows:
DKK 15,000 x 2.7% x 91 days = DKK 100.97 (DKK 101)
365 days
Total payment DKK 15,101.00
International Introduction
Side 35
Underpaid tax
If your tax assessment notice shows that you have paid too little tax and you wish to pay the rest from a foreign bank account, you need an IBAN number (International Bank Account Number) and a SWIFT/BIC code in order to pay SKAT:
IBAN number: DK94 3000 0007540531 SWIFT/BIC code: DABADKKK
You must write your Danish civil registration number (CPR) and which year the payment concerns.
International Introduction
Leaving Denmark?
Please remember to
• inform SKAT about your residence and other relevant information about your stay abroad when leaving Denmark
• fill in form no. 04.029E and send it to SKAT. If you are moving abroad (including to Greenland or the Faroe Islands), your tax liability has to be determined.
Side 36