Deduction for business expenses
You can get a deduction for the expenses you incur to run your business. The expenses must be incurred to secure, get and maintain the ongoing operations of the business. You deduct these expenses in your business’s annual accounts. You must be able to document the expenses you deduct.
Our Danish-language Bookkeeping Guide helps you with how to record your documents correctly and get the right deductions for your business expenses.
Examples of deductions include:
- Purchases, purchases of goods for resale,
- Equipment and machinery
- Fees for accountants and lawyers
- Telephone and internet expenses
- Rent for business premises
- Electricity and heating
- Repair and maintenance of business premises
- Insurance
You're not entitled to deduct private expenses – meaning items you buy through your business but only use for private purposes. If you buy something which is used for both business and private purposes, you can deduct the part you use for business purposes.
You are also entitled to deduct VAT on some of your business expenses.
Check if a business is registered for VAT or has employees
You can check the businesses you work with to see if they are registered for VAT or if they are registered as employers. If they are not registered, you may risk losing your deduction.
Check if a business is registered for VAT in Denmark (in Danish)
Check if a business is registered as an employer and has employees (in Danish)
If you work with non-Danish businesses, you may also check if they are registered for VAT in their home countries. There may be certain requirements for non-Danish business to be registered in RUT (Register of non-Danish service providers).
You get a deduction for your business expenses by recording them in your bookkeeping. This way, they are included in the calculation of the business result in your accounts.
When you report your taxable business result, remember to adjust for expenses that are not tax-deductible.
When you start your business, you cann't get a deduction for the expenses you incur to set up the business. These are typically one-off expenses, such as:
- Expenses for an accountant or lawyer in connection with starting the business
- Expenses for market research
You can get a deduction for the expenses you incur to run your business. These expenses must be incurred to secure, get and maintain the ongoing operations of the business. In the other sections on this page, you can read more about which expenses you can deduct.
Deduction for expenses incurred within the last 6 months before start-up
In addition, you may be able to get a deduction for other expenses you have had in connection with starting your business. This could include expenses such as rent for premises, phone costs or wages during the start-up phase.
You must assess if you can get a deduction for each individual expense. The closer the expense is paid to the start-up date, the more likely it is that you can deduct it. The expenses must have been paid within the last 6 months before the start-up. If you are unsure whether you can deduct an expense, you can contact us or your accountant.
Operating costs relate to the continuous operations of your business, such as rental of premises, minor assets and depreciation. You can deduct such costs in your financial statements.
Plant and equipment include machinery, cars and furniture and fittings which are part of your operating costs. You can deduct plant and equipment items in your financial statements as minor assets as long the cost is less than DKK36,000 in 2026 (DKK 34,400 in 2025) and the item is bought the same year. If the cost exceeds DKK 36,000 in 2026 (34,400 in 2025), you have to depreciate the item by an annual amount.
The limit depends on whether you are registered for VAT or not. If you are registered for VAT, the acquisition price is excluding VAT. If you are not registered for VAT, the acquisition price is including VAT.
Example
If you are registered for VAT, you can buy a machine for DKK 36,000 excluding VAT in 2026 (DKK 45,000 including VAT).
If you are not registered for VAT, you can only buy a machine for DKK 28,800 excluding VAT in 2026 (DKK 36,000 including VAT).
Deduction for minor assets
You may deduct plant and equipment with a short life (maximum 3 years) and minor assets with an acquisition price of maximum DKK 36,000 entirely in the year of acquisition in 2026.
Items that are part of other items or items that are intended to be used with another item, such as a computer and a printer or a bookcase in a series of bookcases, are considered one item.
This is why you should consider the total cost of the two (or more) items when you want to depreciate the cost, and you should consider whether it is above or below the limit for minor assets of DKK 36,000 in 2026 (DKK 334,400 in 2025).
Deduction for major expenses
If an expense exceeds DKK 36,000 in 2026 (DKK 34,400 in 2025), you can't deduct it right away (a write-off). Instead, you have to spread the expense over a number of years. Doing so is called depreciation. You may depreciate an item by a maximum of 25% a year.
If you have several expenses exceeding the limit, the amounts are added up and the total amount is the basis of the depreciation. This is called the diminishing-balance method.
You can easily depreciate acquisitions at a lower rate if, for example, your business income is low one year and you do not need major deductions. The following years you will be able to raise the depreciation rate again (maximum 25%).
When at some point the amount is less than the limit of DKK 36,000 in 2026 (DKK 34,400 in 2025) you can depreciate the entire amount at once.
Example of increased basis of depreciation
- Acquisition price of electric machine is DKK 100,000
- Depreciation in the acquisition year: DKK 100,000 x 0.25 (+25%) = DKK 25,000.
- Balance on 31 December: DKK 100,000 - DKK 25,000 = DKK 75,000.
Next year, you can again depreciate 25% of the remaining balance. If, based on the example above, you have DKK 75,000 left on your remaining balance, this means that the following year you can deduct DKK 18,750.
When you have gone below the threshold for small assets of DKK 36,000 in 2026 (DKK 34,400 in 2025), you can deduct the entire remaining balance in your annual accounts.
New rule on increased basis of depreciation for brand-new green plant and equipment
When you buy brand-new green assets or equipment, you can get an increased depreciation base of 108%. You can do this if:
- you don't use the asset privately
- the asset or equipment is purchased in the period from 1 January 2025 to 31 December 2026
- the asset is electric or battery-powered (for example, machinery or trucks)
- you don't depreciate the asset immediately
You can't get the increased deduction for:
- passenger cars, ships, and software
- vans, trucks, machinery, or items that are powered — or can be powered — by fossil fuels (such as petrol, diesel, oil, gas, coal, or LPG)
How to apply the increased depreciation base
You must use the purchase price as the depreciation base, and you must keep a separate depreciation account in your tax accounts. If the remaining balance is below the threshold for small assets, you are not allowed to depreciate it immediately, as you may know from the ordinary depreciation rules.
Example of the increased depreciation base
Jens buys an electric machine at a purchase price of DKK 100,000 in 2025. Since the machine is electric and he does not use it privately, he may depreciate the asset on a higher basis. In the calculation example, you can see how he calculates the remaining balance for the asset.
| Purchase of electric machine | DKK 100,000 |
| Increased depreciation base (108 %): DKK 100,000 kr. x 1.08 (8%) | DKK 108,000 |
| Depreciation in the purchase year: DKK 108,000 kr. x 0.25 (25%) | DKK 27,000 |
|
Remaining balance on 31 december: 108.000 kr. - 27.000 kr. |
DKK 81,000 |
Plant and equipment for both business and private purposes (mixed plant and equipment)
If you use plant or equipment for both business and private purposes, a car for example, you need to depreciate it separately. You cannot depreciate it along with other plant and equipment, and you cannot apply the rule on increased basis of depreciation.
You can only deduct the actual acquisition price, and only the part used for business purposes is deductible in your accounts.
You need to assess how much you use the plant and equipment for private purposes according to how it is actually used. For cars, you use the mileage log to find out how much of the driving is for private purposes and how much is for business purposes. Read more about ‘Using of a private car for business purposes’ further down on this page.
Example of depreciation of a machine for both business and private purposes
- The acquisition price of the machine is DKK 100,000
- The depreciation is DKK 100,000 x 0.25 (25%) = DKK 25,000.
- Private depreciation: DKK 25,000 x 0.40 (40%) = DKK 10,000.
- Business depreciation: DKK 25,000 x 0.60 (60%) = DKK 15,000.
- Balance: DKK 75,000
Once your balance is less than the limit for minor assets of DKK 16,900 in 2026 (DKK 16,200 in 2025), you can deduct the balance related to the business purposes in your annual accounts. If, for example, the balance is DKK 14,000 in the beginning of the year, you will be able to deduct the remaining part for business purposes (60%) DKK 8,400 directly in your financial statements.
Read about the rules for depreciation in our Danish-language legal guide
You can deduct all expenses for advertising in your accounts, including adverts in newspapers and marketing activities.
You can deduct 25% of expenses for entertainment in your accounts. Entertainment is expenses to complete a business activity or to make or maintain business relations such as:
- Food
- Meals in restaurants
- Beverages
- Gifts
- Expenses related to anniversaries, birthdays, travelling, outings, etc.
It is important that you keep vouchers and note the reason for the expense as your documentation.
In order to be entitled to deduct expenses for premises in your private home, such premises may not be set up in a way allowing you to use them for private purposes. It's not sufficient that you don't use the premises for private purposes. A room that has been set up as an office, can, for example, almost always be used for private purposes, and as a result the expenses for this room are not deductible.
However, you can fully or partially deduct expenses for desks, cabinets and other office furniture if you are able to document or make probable that such furniture etc. is used in your business. If, for example, you use the office furniture 50/50 in your business and privately, you can only deduct 50% in your accounts.
You can deduct expenses for telephone or internet access that you use in your business. You claim your deduction by entering the expenses in your tax accounts.
But at the same time, you have to pay tax on the value of the phone and in some cases the value of the internet. When you have a phone and Internet access via your business, it's called company phone and company internet access.
You have to pay tax on a company phone when you claim expenses and you also can use the phone for private purposes.
How to claim your expenses and pay tax on the value of the phone
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Enter the expenses for the company phone in your tax account as expenses
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Add DKK 3,500 for 2026 or DKK 3,300 for 2025 to your business result in your tax accounts. The amount is a fixed value of company phone and company internet access and the amount is adjusted every year.
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Enter DKK 3,500 for 2026 or DKK 3,300 for 2025 in field 462 in your tax return.
You are entitled to fully deduct internet expenses if you have access to your business network via your computer in your private home (meaning that you have access to almost the same functions and/or documents as when you are at work).
If you can access the business network in you private home
If you have access to the business network in your private home, you don't have to pay tax on the value even if you can claim the expenses. To make the claim you enter the internet expenses in your tax accounts as expenses.
If you can't access the business network in your private home
If you don't have access to your business network in your private home, you have to pay tax on the value of company internet access. To claim the expenses and pay tax on the value of internet access, you have to do as follows:
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Enter the expenses for company internet access in your tax accounts as expenses
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Add DKK 3,500 for 2026 or DKK 3,300 for 2025 to your business result in your tax accounts. The amount is a fixed value of company phone and company internet access and it's adjusted every year.
If you have to pay tax on both the value of company phone and company internet access, you pay the same amount as if you were taxed on either company phone or company internet access. So, you're not taxed double.
The amount is a fixed value of company phone and company internet access and it's adjusted every year. In 2026, it's DKK 3,500. In 2025, it was DKK 3,000.
How to pay tax on the value of both company phone and company internet access:
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Add DKK 3,500 for 2026 or DKK 3,000 kr. for 2025 to your business result in your tax accounts.
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Enter DKK 3.500 kr. for 2026 or DKK 3,300 for 2025 in field 462 in your tax return.
If you and your spouse are both taxed on free phone and/or internet access, you're both entitled to a 25% discount. As a result, you're taxed on a smaller amount. The amount you are taxed on will then be DKK 2,625 for the year for each of you in 2026 or DKK 2,475 for the year for each of you in 2025.
To get the discount you have to meet the following criteria:
- You must be married or registered partners
- You must be living together at the end of the year
- The total taxable value of the benefits received in the income year must amount to at least DKK 4,600 in 2026 (DDK 4,400 in 2025). This means that, within the tax year, you will jointly be taxes on benefits for at least 16 months.
If you were married during the income year, you are entitled to the spouse discount for the entire income year. This applies irrespective of the time of year you were married.
To claim the spouses discount, the one of you who runs the business has to do as follows:
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Enter DKK 2,625 for 2026 or DKK 2,475 for 2025 to your business result in your tax accounts.
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Enter DKK 3,500 for 2026 or DKK 3,300 for 2025 in field 462 in your tax return. We calculate your spouse discount automatically.
If you have your own business and use your private car for business purposes, you can deduct the part of your driving that is related to your business by deducting the relevant expenses in your business accounts.
You can calculate expenses for business-related use of car in 2 ways:
- According to a calculated "rental cost" corresponding to the actual business cost (that is the business part of operating costs and depreciation).
- According to the Danish Tax Council’s rates for driving in own car for business purposes. The rates are adjusted annually:
Rates for 2024: DKK 3.79/km until 20,000 km/per year and DKK 2.23 DKK/km after 20,000 km/per year.
Rates for 2025: DKK 3.81/km until 20,000 km/per year and DKK 2.23 DKK/km after 20,000 km/per year.
Example 1: Deduction for actual expenses for business-related transport
According to the mileage log, you travelled 20,000 km, of which 8,000 km (40%) is business related.
Total car operating costs (petrol, insurance, repairs etc.) amount to DKK 24,500.
Value of the car for tax purposes is DKK 150,000.
The car’s value for tax purposes at the beginning of the income year can be depreciated by up to 25%.
| Items | Amount (DKK) |
|---|---|
| Business part of operating costs: 40% of DKK 24,500 | 9,800 |
| Depreciation: 150,000 x 25% = 37,000 x 40% | 15,000 |
| Total deduction: | 24,800 |
Ifølge kørebogen har du kørt 20.000 km, hvoraf de 8.000 km (40 %) er erhvervsmæssig kørsel.
Samlede driftsudgifter på bilen (benzin, forsikring, reparation mv.) er på 24.500 kr.
Bilen har en skattemæssig værdi på 150.000 kr.
Du kan afskrive op til 25 % af den skattemæssige værdi, bilen har ved indkomstårets begyndelse.
| Erhvervsmæssig andel af driftsudgifter: 40 % af 24.500 kr. = | 9.800 kr. |
| Afskrivninger. 150.000 kr. x 25 % = 37.000 kr. x 40 % = | 15.000 kr. |
| Fradrag i alt: | 24.800 kr. |
Example 2: Deduction according to the Danish Tax Council’s rates
According to the mileage log, you travelled 20,000 km, of which 8,000 km (40%) is business related.
2024:
According to the Tax Council’s rates you can deduct 8,000 km x DKK 3.79 = DKK 30,320.
2025:
According to the Tax Council’s rates you can deduct 8,000 km x DKK 3.81 = DKK 30,480.
Remember to keep a log of the distance travelled for business/private purposes so that you can document how much you have used the car for private and business purposes respectively.
You may also opt for the business taxation scheme and let your car be part of this (meaning that your car is included in the business finances). If you do so, you will be taxed on having a company car, if you also have it at your disposal for private purposes. In return, you are entitled to deduct all car expenses in your business accounts.
For further legal information in Danish see our legal guide .