The Danish frontier worker regime (“Grænsegængerreglerne”) holds a number of benefits. If eligible, you will be able to claim your taxes assessed as if you were a Danish resident. As such, you can then claim tax deductions in the Danish tax return and claim a personal allowance – we have listed some of the benefits below but it is a non-exhaustive list.
Benefits of using the frontier worker regime
You will have the right to deduct any expenses on interest from debt on your real estate.
If you are married, you are able to have the marriage registered for tax purposes and utilize the benefit of your spouse also receiving a personal allowance and tax deductions. If unused (e.g., if your spouse is not working), the allowances and deductions will be transferred to you.
Danish taxes are generally assessed on a yearly basis with a personal allowance. If the income is taxable for less than a full-year, the income can be converted to a full-year income with a personal allowance. If not converted you get no personal allowance.
But if you are eligible for the frontier worker regime, there will be no full-year conversion but you will still be eligible for a personal allowance.
You are entitled to a full personal allowance if eligible for the frontier worker regime.
If eligible for the frontier worker regime, you are able to claim deductions for expenses which are tax deductible in Denmark. Individuals, who are limited liable to pay taxes to Denmark and not eligible for the frontier worker regime, are only able to claim deductions for expenses related to the income earned in Denmark.
Are you eligible?
To qualify for the frontier worker regime, you must either be limited liable to pay taxes to Denmark or fully liable to pay taxes to Denmark, but considered to be domiciled for tax purposes in your home country.
Furthermore, to qualify for the frontier worker regime, if you are limited to tax liability in Denmark and earn at least 75% of your entire income in Denmark.
If you are able to qualify for the frontier worker regime, you shall submit an application as part of your Danish tax return, thereby allowing the Danish Tax Agency to verify the claim as well as assessing the income applying the regime.
If you are still unsure if you are eligible for the frontier worker regime, you can take the following short survey for an estimate.
Includes all income which is subject to Danish taxes throughout the entire year, e.g. January 2022 – December 2022.
You shall also deduct expenses which relate to the income, e.g. premiums paid to an unemployment scheme, travel expenses, etc.
The global income includes the Danish income as well as any other income earned in the entire year, e.g. January 2022 – December 2022.
Normally, this will be income from shares (dividends, sales), interests, etc.
