An employee’s tax situation during a stay abroad depends on the destination and on whether the employee continues to have a residence at his/her disposal in Denmark, used by family members, for instance.
The employee continues to be registered in Denmark
If the employee continues to be registered in Denmark during the period abroad, he/she remains fully liable for tax to Denmark and continues to be a Danish resident for tax purposes. Consequently, Denmark can continue to tax the employee’s global income and therefore also income earned from work abroad.
Whether the employee will also be liable for tax abroad depends on the country’s internal rules and any double taxation agreement that may have been entered into between Denmark and the country in question. In the event of double taxation, Denmark grants a reduction in the Danish tax payable.
The employee moves to another country
If the employee moves to another country and gives up his/her residence in Denmark, the employee ceases to be fully taxable in Denmark. Accordingly, the employee will only have limited tax liability to Denmark if he/she has a certain amount of income from sources in Denmark.
Upon termination of full tax liability to Denmark, tax may be payable on securities, etc. in connection with the change of residence.
Aarhus University has entered into an agreement with the PricewaterhouseCoopers firm of auditors about tax advice in connection with potential employment abroad. Employees can therefore obtain an individual assessment of the tax rules that apply during the period abroad, including any tax payable in connection with the change of residence and possibilities for optimising any pension schemes.