Banking, Money and Taxes in Denmark
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Expats will find that managing banking, money and taxes in Denmark is an easy and convenient process.
However, although the country's highly developed financial infrastructure is a definite plus, expats will need to budget their money carefully as Denmark has one of the highest tax rates in the world, not to mention a notoriously high cost of living.
Money in Denmark
The official currency of Denmark is the Danish krone or crown, abbreviated as DKK. The krone is divided into 100 øre.
Notes: 50, 100, 200, 500 and 1,000 DKK
Coins: 50 øre and 1, 2, 5, 10 and 20 DKK
Banking in Denmark
Opening a bank account
To open a bank account in Denmark, expats must first apply for and obtain a Civil Registration Number (CPR) and head to the bank to open their account. Expats will need to open a NemKonto, which is used for salary and government payments such as tax refunds. It is compulsory for all residents in Denmark to have a NemKonto.
ATMs and credit cards
ATMs can be found outside all banks in Denmark, as well as in most supermarkets and shopping centres. Expats can use their credit cards to withdraw cash from ATMs.
Credit cards can be used throughout the country, but most small payments are made in cash. The Danish also have a card payment system called Dankort, but expats must have a Danish bank account to use this system. It is useful to have Dankort because it is accepted across the country and some small businesses may not accept international credit cards.
Taxes in Denmark
Expats who are tax residents of Denmark will be taxed on their worldwide income. Expats qualify for tax residency simply by living in Denmark. Those who are not Danish residents but who live in Denmark for six consecutive months also qualify for Danish tax residency.
The tax system in Denmark is automatic, which means that tax will be deducted from an expat’s salary before they are paid. Expats should register with the Central Tax Administration (SKAT) before they receive their first paycheck. Expats will receive a tax card that is sent directly to their employer, which will ensure that they are taxed correctly.