We often receive inquiries from people who live in Denmark and are employed by a non-Danish employer. They are not sure how to deal with tax and social security.
Initially, it can be concluded that they should be taxed of their salary with the regular Danish tax rates as if they had received the salary from a Danish registered employer.
However, there are several other issues that need to be considered to ensure that the Danish rules for employment are respected. This must be done to ensure that both the employer and the employee comply with the obligations that apply to the Danish labor market. At the same time, it is also done to ensure that the rights made available are taken into account. It’s not as simple as many think, and it can cause problems for both the employee and the employer if the rules are not respected. When you live in Denmark Danish rules apply and a foreign employer can not apt out of these. Additionally, it is not easy to get an overview of how to deal with talking to many different government agencies in order to get this overview.
The following topics should be clarified: Should the employer be registered in Denmark and is it in more than one public register? Should the employer pay tax in Denmark? Should the employer pay social contributions in Denmark? Should the employer have a responsible representative in Denmark? Should an employment contract be in accordance with Danish rules? Should the employee pay Danish tax and possibly foreign tax? Should the employee himself pay his income in Denmark? Should the employee pay social contributions in Denmark, for example ATP (Danish labor market pension scheme)? For both employee and employer, it is additional interesting whether it may have financial consequences if the required registrations have not been made. The answer is here that it has financial consequences and it can even have very serious consequences if the required registrations are not made.
If you need help to ensure that both the employee and the employer comply with the Danish rules, please contact Inwema at firstname.lastname@example.org