Income tax on rent, worked example, in Denmark

Taxation Researcher | July 20, 2019

Non-resident couple´s joint monthly rental income1 €1,500 €6,000 €12,000
Annual Rental Income2 18,000 72,000 144,000
Less Allowance 3 941 941 941
Less Expenses (40%)4 6,824 28,424 57,224
= Taxable Income 10,235 42,635 85,835
Income Tax 5
Up to DKK 44,800 0% - - -
DKK46,200 - DKK 513,400 8% 337 2,929 5,039
Over DKK 513,400 15% - - 2,525
Annual Income Tax Due 337 2,929 7,563
Tax Due as % of Gross Income 1.87% 4.07% 5.25%

Notes


1 The property is jointly owned by husband and wife.

2Exchange rate used: 1.00 EUR = 7.44 DKK

3 Taxpayers are entitled to an allowance of DKK7,000 (€937).

4 After deducting the allowance from gross income, taxpayers may deduct 40% to account for income-generating expenses.

5 Rental incoem earned by nonresident individuals are taxed at progressive rates.

INCOMTE TAX 2015

TAXABLE INCOME, DKK (€) TAX RATE
Up to DKK 46,200 (€ 6,210 ) 0%
DKK46,200 - DKK 513,400 (€ 69,005 ) 8%
Over DKK 513,400 (€ 69,005 ) 15%

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