The Danish Tax System

In Denmark, we follow the principle that all citizens use the public sector in some way, and thus all citizens must help pay for it.

The tax funds are used to pay for the different expenses that Danish society has, such as welfare benefits, state pension, child benefits, and public institutions, such as schools, hospitals, libraries, and the police.

The Danish tax system is progressive. This means that the higher your income, the more taxes you have to pay. In many other countries, citizens pay less tax than in Denmark, but in return, they have to pay to go to school, the hospital, the doctor's, etc.

If you get a Danish residence permit and a civil registration number (CPR number), you will be able to take part in the welfare benefits.

How and when to pay tax

When working in a Danish company in Denmark, you have to pay taxes starting from your first day at work. This type of tax is referred to as income tax.

When arriving in Randers, you should contact the local tax center in order to get a preliminary income assessment, a tax rate, and a deduction card. The local tax center will also be able to help you if you have questions regarding your personal taxes or taxes in general.

Besides income tax, you also have to pay property tax if you own any real estate. In addition, you pay indirect taxes when you purchase some products, such as cigarettes and alcohol.

Tax benefits for researchers and commuters

Foreign researchers benefit from favourable tax schemes.

You can also receive certain tax deductions if commuting more than 12 kilometres to work. The rent is much lower in Randers than in the surrounding cities, hence, it can be profitable to live in Randers while working in one of the surrounding cities, like Aarhus or Aalborg.