Freelancer Tax in Denmark: B-Skat, Deductions & How to Keep More of Your Money (2026)

Tax is the number one reason freelancers in Denmark sign up for expensive umbrella services — paying 6–8% of every invoice just to avoid dealing with B-skat. But Danish freelancer tax is far simpler than most people think. This guide breaks it all down so you can handle it yourself and keep every krone you earn.

A-Indkomst vs. B-Indkomst: The Key Difference

In Denmark, all income falls into two categories:

• A-indkomst (A-income): Salary from an employer. Tax is automatically withheld before you receive your pay. No action needed from you.
• B-indkomst (B-income): Income from freelance work, side projects, or self-employment. Tax is not withheld — you receive the full amount and handle tax yourself.

When you invoice a client as a freelancer (with or without a CVR number), the money you receive is B-indkomst. This is the case whether you earn 5,000 DKK or 500,000 DKK per year.

How B-Skat Works (Step by Step)

B-skat sounds intimidating, but it's a straightforward process:

1. Estimate your annual freelance income — how much do you expect to earn this year, before expenses?
2. Enter it in your Forskudsopgørelse (preliminary income assessment) on skat.dk, field 210. This is where you tell SKAT what you expect to earn.
3. SKAT calculates your B-skat — based on your estimate, SKAT splits the tax into 10 monthly installments (January–October, no payments in November and December).
4. Pay on the 20th of each month — the amount is either auto-collected or you pay via your bank. That's it.

At year-end, you file your Oplysningsskema (tax return) with your actual earnings. If you paid too much, you get a refund. If you paid too little, you pay the difference.

Pro tip: Update your Forskudsopgørelse during the year if your income changes significantly. This avoids a large surprise bill in March.

What Tax Do You Actually Pay?

As a freelancer in Denmark, your B-indkomst is subject to these taxes:

• AM-bidrag (labor market contribution): 8% of your gross B-income. This is deducted first, before other taxes are calculated.
• Kommuneskat (municipal tax): Varies by municipality, typically 23–27%.
• Bundskat (state bottom-bracket tax): 12.01% on income above the personal allowance.
• Topskat (top-bracket tax): An additional 15% on income above approximately 640,000 DKK (after AM-bidrag).
• Kirkeskat (church tax): ~0.4–1.3% if you are a member of the Danish National Church.

Your effective tax rate on B-indkomst is typically 37–52% depending on your municipality, total income, and deductions. The first ~50,000 DKK is covered by your personfradrag (personal allowance) and is tax-free — but only if it hasn't already been used by your A-indkomst from a regular job.

Freelancing While Employed (Dual Income)

Many Danish freelancers have a regular job and freelance on the side. Here's how that works:

• Your salary is A-indkomst — tax is withheld automatically.
• Your freelance earnings are B-indkomst — you report and pay tax separately.
• Your personfradrag is typically already used by your employer, so your B-indkomst is taxed from the first krone.
• Enter your expected B-income in your Forskudsopgørelse so SKAT can calculate correct monthly installments.

Tax Deductions You Can Claim as a Freelancer

As a self-employed freelancer, you can deduct expenses that are necessary to earn your income. These reduce your taxable profit:

• Software and tools: Subscriptions, licenses, design tools, development environments, cloud hosting.
• Hardware: Computer, monitor, phone, camera — if used primarily for work.
• Home office: A proportional share of rent/mortgage, electricity, and internet based on the office's share of your home's total area. Alternatively, a fixed deduction of ~2,000 DKK/year for a dedicated work room.
• Transport to clients: Driving deduction at the state rate: 3.79 DKK/km for the first 20,000 km, 2.23 DKK/km thereafter (2026 rates). Keep a logbook with date, destination, purpose, and kilometers.
• Phone and internet: Business share of your phone plan and home internet.
• Professional development: Courses, books, conference tickets directly related to your work.
• Marketing: Website hosting, domain names, ads, business cards.
• Accounting software: Invoicing tools, bookkeeping subscriptions.

Important: Keep all receipts and documentation. SKAT can request proof for any deduction claimed.

VAT (Moms): When Does It Apply?

• Under 50,000 DKK/year: No VAT registration needed. Do not charge moms on your invoices.
• Over 50,000 DKK/year: You must register for VAT on Virk.dk and charge 25% moms on all invoices. You file quarterly VAT returns on skat.dk and can deduct VAT on business purchases (input VAT).

VAT registration is separate from your income tax. Even if you are not VAT-registered, you still pay income tax (B-skat) on your earnings.

Do You Need a CVR Number?

Not necessarily. Here's a quick decision guide:

• Under 50,000 DKK/year, occasional work: You can invoice with your CPR number. No CVR needed. Report as B-indkomst.
• Under 50,000 DKK/year, regular activity: Consider registering a PMV (Personligt Ejet Mindre Virksomhed) — a micro-business with a CVR number but no VAT obligation. Must be re-registered every 3 years.
• Over 50,000 DKK/year: Register an Enkeltmandsvirksomhed (sole proprietorship) on Virk.dk. You get a CVR number and must register for VAT.

PMV vs. Enkeltmandsvirksomhed: Which One?

Two common structures for Danish freelancers:

• PMV (Personligt Ejet Mindre Virksomhed): For hobby/part-time freelancing. Max 50,000 DKK/year. No VAT. No bookkeeping obligation (but recommended). One owner, no employees. Must re-register every 3 years. Free to set up on Virk.dk.
• Enkeltmandsvirksomhed (Sole Proprietorship): For serious freelancing. No turnover limit. VAT-liable above 50,000 DKK. Full bookkeeping obligation (digital bookkeeping mandatory since 2024). Can hire employees. Free to register on Virk.dk.

Rule of thumb: If you expect to earn more than 50,000 DKK/year or want to grow your freelance business, go with Enkeltmandsvirksomhed. If it's a side project under 50,000 DKK, PMV is simpler.

Why You Don't Need an Umbrella Company

Umbrella companies (like Factofly, Cool Company, or Worksome) offer to "handle everything" for you — invoicing, tax, VAT. In return, they take 6–8% of every invoice.

Let's do the math:

• You invoice 30,000 DKK/month → they take 1,800–2,400 DKK/month.
• Over a year, that's 21,600–28,800 DKK gone — for something you can do yourself in 30 minutes per month.

What they actually do:

1. Convert your B-indkomst to A-indkomst (so tax is withheld automatically).
2. Issue the invoice on your behalf.
3. Handle VAT reporting.

What you can do instead:

1. Use Fakturify to send professional invoices for free — takes 60 seconds.
2. Update your Forskudsopgørelse once on skat.dk — takes 10 minutes.
3. Pay B-skat monthly — automatic if you set it up correctly.
4. File your tax return once a year — takes 20 minutes with proper records.

Total time: ~30 minutes/month. Savings: 20,000+ DKK/year.

Checklist: Your Freelancer Tax Setup in Denmark

1. Decide if you need a CVR number (over 50,000 DKK → yes).
2. Register PMV or Enkeltmandsvirksomhed on Virk.dk if needed.
3. Log in to skat.dk and update your Forskudsopgørelse with expected B-income (field 210).
4. Set up Fakturify — enter your details once, start invoicing immediately.
5. Keep receipts for all business expenses (digital copies are fine).
6. Pay B-skat on the 20th of each month (January–October).
7. File your Oplysningsskema (tax return) by May 1st the following year.

Frequently Asked Questions (FAQ)

How much tax does a freelancer pay in Denmark?
Your effective tax rate depends on your total income and municipality. B-indkomst is subject to 8% AM-bidrag, then income tax at approximately 37–52%. The first ~50,000 DKK is covered by the personal allowance (personfradrag) if not already used by employment income.

What is the difference between A-skat and B-skat?
A-skat is automatically withheld from your salary by your employer. B-skat is tax on self-employment income that you pay yourself in 10 monthly installments via skat.dk.

Do I need to pay VAT (moms) as a freelancer?
Only if your annual turnover exceeds 50,000 DKK. Below that threshold, you are not VAT-registered and must not charge moms on your invoices.

Can I deduct my home office expenses?
Yes. You can deduct a proportional share of rent, electricity, and internet based on your office's share of your home's total area. Alternatively, use the fixed deduction of ~2,000 DKK/year for a dedicated room.

What is a PMV and do I need one?
A PMV (Personligt Ejet Mindre Virksomhed) is a micro-business form for freelancers earning under 50,000 DKK/year. It gives you a CVR number without VAT obligations. It's optional — you can also invoice with just your CPR number.

Is it worth using an umbrella company like Factofly?
Umbrella companies charge 6–8% of every invoice to convert your B-income to A-income and handle admin. For most freelancers, this costs 20,000+ DKK/year for tasks that take 30 minutes/month to do yourself. Use a free invoicing tool like Fakturify and manage your own Forskudsopgørelse instead.

When do I need to register a company?
When your turnover exceeds 50,000 DKK in a rolling 12-month period. Register a sole proprietorship (Enkeltmandsvirksomhed) on Virk.dk within 8 days and start charging 25% VAT.