A tax deduction covers a number of different deductions. If you are entitled to a deduction, you will thus receive a higher available amount. The different types of tax deduction all have the same purpose; namely that you avoid paying tax on a portion of your income. Most people know the deduction to which all persons are entitled.

Broadly speaking, the personal allowance means that all persons under the age of 18 have just over USD 2,700 a month, which they do not have to pay tax on.

This corresponds to around USD 34,500 annually

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If you are over 18 you are entitled to a larger share of personal allowance. When you reach the age of 18, you receive approximately USD 3,800 a month in deductions, which is an annual tax deduction of approximately USD 46,000.

The personal allowance is deducted from your salary before you have to pay a-TAX. If you do not utilize your entire personal allowance, spouses can, under Danish law, take advantage of each other’s personal allowance.

Withdraw your interest in the Tax

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Many Danes take out a loan at some point in their lives. This could include a loan for a home or a new car. When you take out a loan, you have to pay interest on the loan. An interest is a fee that you have to pay to be allowed to take out a loan and thus borrow the money.

It is therefore an extra expense for you

Which you have to pay in addition to the amount you want to borrow. Interest is always expressed as a percentage and it can be percent per month, quarter or year. The different types of tax deduction all have the same purpose; namely that you avoid paying tax on a portion of your income. Most people know the deduction to which all persons are entitled.