Estate tax
When someone dies it may no be tax issues that take the main focus. However, tax issues will follow. At PrivatRevision we offer highly specialized guidance and help to heirs and estates on complicated and also more simple estates.
An estate is taxable to Denmark if the deceased lived here when he og she died. Regardless where the heirs live there will be an estate tax on 15% on the value of the estate – with a minor tax-free amount of DKK 333.100 (and double after a couple).
If the estates values exceed certain amounts, DKK 3.275.500 in 2024, the estate is also a tax subject. This means that the estate is to pay tax on al income and gains -realized and unrealized – as if the deceased did have or realize this gain while still living. The tax is a flat rate tax on 50% and a little less on stock gains.
An estate can thus be taxed with 50% of all income, profits and gains and afterwards with 15% in estate tax. If the heirs are not in direct line family there is furthermore an additional estate tax on 25%.
For most estates there can be substantial saving by optimizing the estate and profit and to work with the status day (time of deciding taxable value). Especially if the estate exceeds DKK 3-4 mio.
If the estate has not yet become an estate it may be important to look at options to reduce the fortune while everyone is alive.
In case only the heirs live in Denmark but the deceased did not, the estate is not taxable to DK on anything but assets and income located in DK. However, the heirs may as tax subjects in Denmark have an interest in when the status day and value is set and if the values received is considered tax-free inheritance from abroad or is seen as taxable income (with full tax to pay in Denmark).
This is especially relevant with inheritance consisting of foreign stocks, other financial instruments, property and (very much) in case of trusts.
With PrivatRevision we offer tax consulting for estates on our hourly rates. There is no percentage of the estate or savings in our fee. You pay for the time used only. We find this is the most fair – for all parties.