Tax scheme for foreign researchers
Tax scheme for foreign researchers
Headlines Expat Scheme –Tax scheme for foreign researchers (and key employees) Introduction - Why, how and who? Taxation under the scheme Cutting the period into minor pieces? Leave Where to find more information
Side 2
4. november 2015
Tax scheme for foreign researchers
Why? Incentive to bring foreigners with special abilities to Denmark. People who would not have come otherwise. Hopefully it will bring more jobs to Denmark on a long term basis.
NOT an automatic benefit for foreign researchers. The scheme applies to all sectors and to
both Danes and foreigners.
Side 3
4. november 2015
Tax scheme for foreign researchers
How? – Which taxation Special tax scheme with 26 % flat rate tax - 8% labour market contribution + 26% tax (31,92% net) Of the salary from the employer – flat rate tax Until 5 years during a lifetime
Side 4
4. november 2015
Tax scheme for foreign researchers
Who? Researchers employed at a University (or certain research institutions). Researchers employed elsewhere. Must hand in application for approval to Researchers Council at the latest the day of commencing the new job. To be approved under the scheme as a researcher researchers have to:
- have researcher qualifications – a Ph.D. or similar - have a researcher job – where research is the main topic or
Foreigners with at least 61.500 kr. per month in 2015, plus 90 kr. ATP.
Side 5
4. november 2015
Tax scheme for foreign researchers
Taxation under the scheme Two separate calculations -
One for researcher taxation and
-
One for all other income
Taxed under the scheme is: Salary from the employer including free car, additional health insurance and phone
Side 6
4. november 2015
Tax scheme for foreign researchers
Taxation under the scheme Taxed outside the scheme according to the normal rules: All other income is taxed according to ordinary tax rules Employee benefits (free housing, free food and accommodation etc.) Income from other sources (income from other employments not approved under the special tax scheme, interest income, dividend on shares etc.) Means, that personal deduction, deduction for interest rates etc. can be used in that income
Value of an owned house might be taxed
Side 7
4. november 2015
Tax scheme for foreign researchers
Taxation under the scheme Paid interest rates Non-commercial deficits in ordinary income can not be carried forward to next year or to your spouse. Your spouse can not carry forward non-commercial deficits in ordinary income Deduction? Gross income is taxed with a flat rate tax of 26 % No deductions – except: - for fully tax liable persons, resident in Denmark
- from EU or where Denmark has an agreement - according to the agreement - mandatory payments for social security Side 8
4. november 2015
Tax scheme for foreign researchers
Taxation under the scheme Pension Deduction when paid in taxation when paid out, and first at pensions age. Taxation: 6%? 35%? Taxation when paid in no taxation when paid out. Only few pension funds have the product. SKAT has no limitations on paying out, but the pension fund probably has. Foreigner and only employed for a period of maximum 5 years? Possible to choose to get the money paid out.
Side 9
4. november 2015
Tax scheme for foreign researchers
Taxation under the scheme Deadlines Application for the special tax rules can be retrospective for up to 3 tax years (for 2015 no later than 1 May 2019). Possible to opt out of the scheme with retrospective effect for a whole year (for 2012 no later than 1 May 2016). Periods with normal taxation disqualify from researcher taxation for 10 years.
Side 10
4. november 2015
Tax scheme for foreign researchers
Taxation under the scheme What is most beneficial? We will NOT guide you (Rough) Guidance can be found by using this site: skat.dkSearch for; “Beregn din skat 2015” (Calculate your tax) The site is only in Danish, and it is rather complicated, so you will need help from a Dane
Side 11
4. november 2015
Tax scheme for foreign researchers
“Cutting the period into minor pieces?” Important to know the rules Condition: Not been liable to tax within the latest 10 years. (10-year rule) Periods under the special tax scheme are ignored.
Condition: Tax liability has to start, because you begin in the job allowing researcher taxation
Condition: Employment with a Danish company or institution or a Danish branch of a foreign company (not controlled by the employed)
Side 12
4. november 2015
Tax scheme for foreign researchers
“Cutting the period into minor pieces?” 10-year rule: Neither fully liable to tax (liable of global income) - by housing, or by staying for more than 6 months (Move out!) nor limited tax liable (tax on Danish sources) - on salary or business income, or what replaces that kind of income, like Danish; pension, SU, Ph.D. funding etc. Okay to have e.g. dividends from shares, positive interest rates
Changing jobs -1 month rule Okay, not to terminate tax liability if there goes until 1 month between working in two different expat-jobs Side 13
4. november 2015
Tax scheme for foreign researchers
“Cutting the period into minor pieces?” 10-year rule – exception Teachers at summer schools etc.: Paid by the University or research institute – only as limited liable to tax (total duration of no more than 12 month within the latest 10 years)
and guest researchers funded from abroad Solely funded from foreign funds - OK if fully liable to tax (Housing) (total duration of no more than 12 month within the latest 10 years)
Side 14
4. november 2015
Tax scheme for foreign researchers
Leave Maternity/Paternity Leave will be judged as employment - applies for both periods with salary and periods with public funding - the period on leave is using of the total amount of months under the scheme - possible to get back on the scheme “Leave without salary” will be considered as a period without employment - must give up tax liability, to be able to get back on the scheme
Side 15
4. november 2015
Tax scheme for foreign researchers
Taxation under the scheme Ran out of period? Make sure you get a new ”tax card” (electronically) – Otherwise you will be charged 8 + 55 % tax! Access skat.dk with NemIdForskudsopgørelse Or
Call 72 22 28 92, tax questions for people with foreign relations
Side 16
4. november 2015
Tax scheme for foreign researchers
Where to find more information www.skat.dk/researchers Contains: P nr. 28 (GB) Tax scheme for foreign researchers and key employees (guideline)
and Application form including information: 01.012 A - Approved Researcher Having tried everything else:
Lene Bernth Fjord – Telephone 7238 5132 Niels Smedegaard – Telephone 7238 9772
Side 17
11. marts 2015
