New tax regulations on the way - however not from 2024

The Government has previously announced that it plans to implement a reform for income taxes. The recently presented draft Finance Act for 2024 does not indicate that this will apply from 2024. In the draft Finance Act, the Government has announced that further clarity will come during autumn, however, at the moment it is still unclear exactly when the changes will come into force.

Velliv will keep an eye on the situation, and we will get in contact when relevant.

In brief, the Government proposes to divide the current top-bracket tax in three categories:

• Medium tax of 7,5 percent from the current top-bracket tax limit and up to an income of DKK 750,000 before labour market contribution (LMC)
• Unchanged top-bracket tax on an income of DKK 750,000 - 2,500,000 before LMC
• Top-bracket tax of 20 percent on an income above DKK 2,500,000 before LMC

According to current legislation in 2023, top-bracket tax of 15 percent is levied on an income over DKK 568,900 after LMC, corresponding to DKK 618,370 before LMC.

Besides these changes in the top-bracket tax, the Government proposes to raise the employment deduction with 2.1 percent from 10.65 percent to 12.75 percent and also increase the maximum deduction from DKK 45,600 to DKK 53,600.