Two recent rulings from the Danish National Tax Tribunal, both dated November 13, 2024, illustrate the strict practice applied when taxpayers seek to utilize the researcher tax scheme.

The purpose of the researcher tax scheme is to incentivize high-income earners to take jobs in Denmark. By utilizing the scheme, a fixed tax rate of 27% + AM contribution (labour market contribution) is applied, resulting in an effective flat tax rate of 32.84%. This flat tax applies to salary subject to A-tax and derived from the approved employment. The scheme lasts for a maximum of 7 years, and it is required that the taxpayer is either employed as a researcher or has a salary exceeding DKK 78,000 per month (in 2025).

To qualify for the researcher tax scheme, several requirements must be met, including the rule that the applicant must not have been tax resident in Denmark within the last 10 years. This is the criteria that the National Tax Tribunal addressed in the two rulings mentioned above.

In both cases, the appellants argued in support of their eligibility for the researcher tax scheme that they had been incorrectly registered as fully tax liable to Denmark for part of the period within the last 10 years when, in fact, they had ceased to be tax resident in Denmark. In a ruling reviewed in parallel with one of the above-mentioned rulings, the Danish Tax Appeals Agency ruled that extraordinary reopening of the appellant’s tax assessments could not take place. Consequently, the National Tax Tribunal determined that the registration on the tax assessment must form the basis for assessing whether the appellant fulfilled the 10-year rule for using the researcher tax scheme.
As a result, the taxpayers could not utilize the researcher tax scheme, even though they had not actually earned income in Denmark and thereby met the 10-year rule in practice.

These decisions follow the precedent established by the Supreme Court’s ruling of February 2, 2024. In that ruling, the Supreme Court stated: “(…) Tax assessments are valid administrative decisions that must be relied upon when determining whether A ‘has been tax liable’ to Denmark as mentioned in Section 48 E, subsection 3, no. 1 of the Danish Tax at Source Act.”

The current legal position, therefore, is that citizens are responsible for ensuring that tax authorities correctly register their departure from Denmark for tax purposes. Failure to do so can have significant tax implications—even if it may not immediately affect your tax payments.

At PrivatRevision, we possess in-depth knowledge and experience with both the researcher tax scheme and tax-related emigration from Denmark. If you are considering leaving Denmark, we are happy to advise you on providing the correct information to the tax authorities.

Given that case processing by the tax authorities often continues for a period after one has physically moved to Denmark and started working, it can also be beneficial to consult an advisor before moving to Denmark. This ensures that you meet all requirements, and your application can be approved smoothly.

The purpose of the researcher tax scheme is to motivate highly paid persons to apply for jobs in Denmark. By using the researcher tax scheme, a fixed tax rate of 27% + AM-contribution is paid, which results in a total tax rate of 32,84%.

There are a number of requirements which must be met if you wish to make use of the researcher tax scheme. First and foremost, it is a requirement that you haven’t lived in Denmark for at least 10 years prior to getting the job which qualifies you for the researcher tax scheme and that you haven’t had any labor income from Denmark in the same period. Furthermore, application of the researcher tax scheme requires that you either take up an approved research position or that you meet the requirements to be considered “highly paid”. To be considered highly paid in relation to the researcher tax scheme requires a monthly income, which is considered remuneration for personal work in a subordinate relationship, of at least 75.100 kr. in 2024 (78.000 kr. in 2025) after ATP (a mandatory pensions scheme in Denmark) and after deduction of holiday without pay if no vacation days are earned. There are certain salary components that can be included in the calculation and other salary components that cannot be included.

The Tax Assessment Council have in a binding ruling from the 22nd of October 2024 made a verdict, which states that remuneration arising from a non-competition clause isn’t considered as remuneration for personal work in a subordinate relationship which is covered by §§ 48 E-F of Kildeskatteloven (the researcher tax scheme). The remuneration shall instead be considered as compensation for being limited in taking on work in the clause period. The result hereof being that you’ll step out of the researcher tax scheme, which means that you’ll have to move out of Denmark again for a 10 year grace period, provided that you wish to use the remaining part of your total of 7 years using the researcher tax scheme.

The verdict illustrates that when changing jobs, while being covered by the researcher tax scheme, you have to be extremely careful, not to risk that you no longer fulfill the requirements to make use of the researcher tax scheme. The consequence of no longer fulfilling the requirements to make use of the researcher tax scheme is, that you’ll instead have to pay tax according to the ordinary tax rates, which in some cases can result in taxation of up till 57%. Instead of the fixed tax rate of 32,94% in total when using the researcher tax scheme.

However, if the job change is arranged appropriately, it will be possible to continue using the researcher tax scheme. This is secured by fulfilling the pause rules.

The verdict also illustrates why it is often appropriate to secure your tax situation through a binding ruling from the Tax Assessment Council, before making work-related decisions that could potentially have major consequences for your tax situation. This is especially important if you are operating as much as near the gray area of application of the researcher tax scheme, as The Danish Tax Agency is extremely aware that the rules for applying the researcher tax scheme are fully complied with, and there is virtually no room left for loose interpretation of the rules.

At PrivatRevison we have in-depth knowledge of and experience with using the researcher tax scheme. We are happy to provide advice both in connection with application to use the researcher tax scheme and in connection with a job change.