VAT rates in Denmark
Denmark imposes Value Added Tax (VAT) at different rates as follows for various goods and services:
1. Standard rate - 25%
The standard VAT rate in Denmark is applicable to all taxable goods and services, except when a specific measure allows for a reduced rate.
2. Zero rate - 0%
Applicable to intra-community passenger travel by air and sea; exports and intra-community supplies of goods; charities; newspapers; cultural activities; etc.
3. Exempt
Education; financial services; welfare services; international passenger transport; sports charities.
Source: https://skat.dk/en-us/businesses/vat/how-to-calculate-vat https://skat.dk/en-us/businesses/vat/services-exempt-from-vat
Tax-free per diem allowances are intended to cover meals and small expenses as well as lodging.
Allowances can only be tax-free if an employee’s business trip lasts 24 hours or more.
Tax-free travelling allowances can be paid for up to 12 months. Starting from the 13th month, all expenses should be covered with vouchers, but not with fixed allowance amounts.
Allowance rates are updated 1 January each year.
Domestic daily allowance
The daily allowance amount for business trips in Denmark is DKK 597 per day in 2025.
An additional tax-free amount of up to 25% of the daily rate may be paid out for meals and small expenses.
Meal deductions
The following deductions must be made to the lump sum allowances employees are paid to cover their business travel expenses if these meals are not paid for by the employee:
- 15% for breakfast
- 30% for lunch
- 30% for dinner
Business travel lasting less than 24h does not entitle the employee to a daily allowance. However, business travel lasting more than 24h entitles the employee to a pro rata of the allowance.
E.g.: for a trip lasting 20 hours, no per diem is paid. For a trip lasting 40 hours, a per diem of 1*the daily rate + 16/24 of the daily rate is paid.
Overnight allowance
When working in Denmark or abroad on a temporary basis, a tax-free amount of DKK 256 per night may be paid out to cover accommodation expenses.
Foreign daily allowance
The daily allowance rate amounts to DKK 597 and the percentage compensation DKK 149,25 abroad and in Greenland per 1 January 2025. However, there are several countries that have a specific rate.
Source: https://hr.medst.dk/media/1397/039-24.pdf
Mileage allowances in Denmark
Employees travelling for business with their private vehicle may be entitled to a tax-free mileage allowance, the rates of which are as follows:
| Effective Date | Criteria | Rate |
| 01 January 2025 | First 20.000 km | DKK 3,81 per km |
| 01 January 2025 | Above 20.000 km | DKK 2,23 per km |
| 01 January 2025 | Use of private bicycle, moped, 45-wheel scooter, scooter or electric scooter | DKK 0,63 per km |
Source: https://skm.dk/tal-og-metode/satser/satser-og-beloebsgraenser-i-lovgivningen/ligningsloven
Electronic archiving and retention period in Denmark
Companies must securely store accounting material, cf. § 4, for 5 years from the end of the financial year to which the material relates.
The storage must ensure that the accounting records are not destroyed, disposed of or tampered with, just as the accounting records must be ensured against errors and abuse.
Accounting records are no longer required to be stored in Denmark.
There is no distinguish between accounting material in electronic and paper format.
Source: https://www.retsinformation.dk/eli/lta/2022/700
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