Owning Danish Property as Non-Resident 2026: Property Value Tax, Rental Income, and Limited Tax Liability

Limited tax liability under Kildeskatteloven §2

Owning Danish real estate as a non-resident triggers begrænset skattepligt (limited tax liability) under Kildeskatteloven §2 stk. 1 nr. 5. Denmark retains taxing rights over: rental income, deemed rental (in some cases), capital gains on sale, ejendomsværdiskat (property value tax), and grundskyld (land tax via the kommune). The non-resident landlord files an annual selvangivelse via TastSelv. Deadline: 1 May of the following year, with one-month automatic extension if foreign income is involved.

Foreign residency does not exempt the property from Danish tax. Treaty Article 6 (immovable property) consistently grants primary taxing rights to the country where the property is located. Most treaties allow the destination country to tax with credit method — pay Danish tax first, foreign credit follows. Always file in Denmark first, obtain årsopgørelse, and submit to the foreign tax office.

Rental income taxation under non-resident rules

Net rental income from Danish real estate is taxed at the standard non-resident rate. The actual rate depends on the type of let:

• Long-term residential let (helårsudlejning): net income taxed at 27% on first DKK 61,000 and 42% above — same as ordinary capital income for non-residents. Deductions for mortgage interest, ejendomsværdiskat, grundskyld, insurance, maintenance, and management costs.
• Sommerhus rental (sommerhusudlejning): special schemes apply. Bundfradrag (tax-free amount) DKK 12,200 + 40% deduction on remainder under §15O Ligningsloven, leaving 60% of net income taxable. Or full accounting method (regnskabsmæssig opgørelse) with documented expenses.
• Short-term let (Airbnb): bundfradrag DKK 31,800 if registered through approved platforms (Airbnb, Booking.com); 40% deduction on remainder of gross. Without platform registration, lower bundfradrag DKK 11,800.

Ejendomsværdiskat and grundskyld 2026

The boligskattereformen (housing tax reform) of 2024 changed the basis for property taxes. Effective 1 January 2024:

Non-resident owners pay both ejendomsværdiskat and grundskyld on the same basis as residents. Set up automatic debit from your Danish bank or NemKontoUdland; default leads to inkasso collection and 8.5% delinquency interest under Lov om opkrævning af skatter og afgifter.

Capital gains tax on sale by non-residents

Parcelhusreglen (main-residence exemption under EBL §8) is generally lost once you cease to live in the property — see our property sale guide for the documentation issues. For non-residents who never occupied the property, sales are fully taxable. The taxable gain is sale price minus purchase price minus capitalised improvements minus selling costs, with inflation adjustment available if held >3 years.

The tax rate is the ordinary capital gains rate for non-residents — 27% on first DKK 61,000, 42% above. Inheritance and gift cost basis transfers without step-up; for properties held in family for generations, gains can be substantial. Document acquisition costs and improvements carefully.

Renting through agents while non-resident

Non-resident landlords typically use a Danish property manager (forvalter or ejendomsadministrator) to handle tenant relations, repairs, and tax reporting. Costs: 5-12% of monthly rent for full management; fixed monthly fee DKK 600-2,500. The manager registers as your representative in TastSelv under §6 Skatteforvaltningsloven. Rental contracts must comply with Lejeloven; standard terms include 3-month notice, deposit limited to 3 months’ rent, plus prepaid rent up to 3 months.

VAT and rental: the threshold question

Most residential rental is exempt from moms (VAT) under Momsloven §13. Commercial rental and short-term rental of more than 30 days per year may trigger moms registration if turnover exceeds DKK 50,000. Sommerhus rental on commercial scale (more than 7-8 weeks/year) typically falls under moms — registration is mandatory. Discuss with a Danish tax advisor before structuring.

Inheritance and dødsboskat

Denmark imposes dødsboskat (inheritance tax / estate tax) on Danish-situs property regardless of the heir’s residence. Rates: 15% boafgift for direct descendants and spouses; 36.25% for distant relatives and unrelated heirs. Spouses are exempt under boafgiftsloven §6. Foreign heirs pay Danish dødsboskat on the Danish property, plus possibly inheritance tax in the destination country — most treaties provide credit but careful planning matters.

The EU Succession Regulation 650/2012 allows the deceased to elect the law of their nationality for succession matters. Danish citizens can elect Danish succession law in their will (testament), simplifying cross-border inheritance even if living abroad.

Mortgage and refinancing as non-resident

Danish realkreditinstitutter (Realkredit Danmark, Nordea Kredit, Totalkredit, BRFkredit, DLR Kredit) historically offered competitive 30-year fixed-rate mortgages on Danish property. Non-resident borrowers face stricter conditions:

• Lower loan-to-value (typically 60-70% vs. 80% for residents);
• Higher interest premium (0.25-0.75% above resident rate);
• Annual income verification in foreign currency translated to DKK;
• Property must be insured with a Danish provider for the realkredit covenant.

Refinancing existing mortgages while non-resident is possible but tightened since 2022 — most banks require physical presence at signing or signing through a Danish lawyer with power of attorney.