Tax on Danish pension when you live in Denmark

You have tax advantages from paying into a Danish labour market pension or individual pension

You have tax advantages from paying into a Danish labour market pension or individual pension

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The tax advantages vary depending on the type of pension. When you save up for your pension, there will be a yield on that money. The pension savings yield is taxable. When you have your pension paid out, the pension payments are taxable. The rules vary depending on the type of pension.

If you take your Danish pension with you abroad, you must typically still pay tax on the pension payments in Denmark. In special agreements that Denmark has concluded with other countries it is often agreed that you must pay tax to the country from where the payment comes. In other cases, you must pay tax on the payments in the country where you live.

If you live in Denmark, the point of departure is that you have no right to deduct or exempt contributions paid into a foreign pension scheme by yourself or your employer.

If you have a pension scheme that is established in another EU/EEA Member State, you can have your foreign pension scheme approved by SKAT.

There are particularly favourable tax rules regarding your foreign pension scheme if you are covered by EU rules for so-called migrant workers.

When SKAT has approved your pension scheme, you will pay tax on the payments in more or less the same way as if it were a Danish pension scheme.

If you have moved to Denmark after having lived abroad, you are only required to pay tax or charges on the amount of the payments from your foreign pension scheme that corresponds to the contributions which you have been able to deduct in connection with the calculation of your total personal income.

If you live in Denmark, the point of departure is that you must pay tax to Denmark on the pension that you have paid out from abroad. However, in special agreements that Denmark has concluded with other countries it may be agreed that you must pay tax to the country from where the payment comes.

If you move from Denmark to another country, it is a good idea in advance to study the tax rules that apply to the pension you will take with you abroad.

Please contact SKAT if you want to learn more about your specific tax circumstances.