University Post
University of Copenhagen
Independent of management


Researchers will stay, but only on reduced tax

The tax break is important for high-value employees and researchers, study shows

A reduced tax helps attract international researchers and key employees to Denmark. But it also helps to scare them away when the reduced tax expires.

This is one of the key findings in a new study from Oxford Research/Copenhagen Post, the Expat Study 2010, which has surveyed more than 1500 foreign expatriate staff and academics in Denmark.

Taxation is one of the most important factors when expats make the decision as to which country to work in. And nearly 50 per cent of expats in Denmark pay more in taxes than they expected, the study writes.

Reduced tax is why you are here

While two out of three expatriates are taxed like Danes, 25 per cent of them have reduced taxes according to a reduced tax scheme for foreign researchers and key employees. The standard tax regime for Danes is an income tax of often more than 50 per cent, but the reduced tax scheme allows them to be income-taxed at 25 per cent for three years, or 33 per cent for five years.

The reduced tax is very important in attracting key employees, according to the study.

70 per cent of the expats say that qualifying for the reduced taxes was a key part of their decision in them accepting their current position in Denmark.

Normal tax is why you leave

The trouble is: As the reduced tax expires after three or five years, internationals are ready to pack up and leave.

62 per cent say the reduced tax scheme has a direct influence on their decision on when to leave Denmark, according to the study.

Click here to read The Expat Study 2010.

Read also: Danish cold shoulder has you packing your bags.

Stay in the know about news and events happening in Copenhagen by signing up for the University Post’s weekly newsletter here.