Payroll in Denmark

Thinking about hiring in Denmark? To stay compliant and keep things running smoothly, you’ll need to understand the local rules around HR, payroll, social security, and taxes. Discover the key information laid out for you below.

HR and labor laws in Denmark

When you’re hiring in Denmark, it’s crucial to understand local labor laws. From contracts and working hours to leave entitlements and dismissal procedures, here’s what you should know about specific laws in Denmark.

Employment contracts

Employers must provide written contracts to employees who work more than 8 hours per week and are employed for longer than one month.

Working hours

The standard full-time workweek is 37 hours. Regulations also cover overtime and required rest periods.

Notice periods

These vary depending on the length of employment and are defined by Danish labor law.

Payroll management

Paying your team right means following the local payroll laws and protecting your business from fines or legal issues. Here are the payroll essentials in Denmark:

Minimum wage

Belgian law strictly prohibits discrimination in the workplace based on gender, race, age, religion, disability, sexual orientation, and other protected characteristics. These rules apply during the entire employment process: from job postings and interviews to promotions and terminations. Employers must provide equal opportunities and take active steps to prevent discriminatory practices.

Payroll tax

Employers are responsible for withholding income tax and social security contributions from employees’ salaries.

Social security in Denmark

The social security system in Denmark acts as a safety net for your employees, offering protection in key moments throughout their careers and lives. It’s designed to provide financial support during live events like illness, maternity, unemployment or retirement. Discover how the social security system works in Denmark:

Sick leave

Employees are entitled to paid sick leave, generally for up to 30 days. After that period, benefits may be covered by the national social security system.

Pension

In addition to the state-provided basic pension, employees are enrolled in amandatory occupational pension scheme.

Workplace protections

Creating a fair and safe workplace matters. These laws help protect your employees in Denmark:

Anti-discrimination

Danish law prohibits discrimination based on gender, race, religion, disability, age, sexual orientation, and other protected characteristics.

Parental leave

Parents are entitled to a combination of paid and unpaid parental leave.

Tax regulations in Denmark

Taxes can be tricky. Understanding how the system works in Denmark, helps you avoid surprises and stay compliant. Here are some tax basics to keep in mind:

Income tax

Denmark uses a progressive income tax system with multiple brackets.

Value-added tax (VAT)

The standard value-added tax (VAT) rate is 25%. Paybix helps you managing your payroll in Denmark

Paybix helps you managing your payroll in Denmark

Running global payroll takes local knowhow. With Paybix, you’ll get expert support, tailored to each country your business in situated in. Thanks to our unified and digital platform, you gather clear insight in labor costs and cross-country payroll. You benefit from a 30% more efficient payroll process, including global reporting and core HR data management. Hassle-free, user-friendly and easy integrated with local payroll providers.

To ensurefull compliance with the latest regulations, Paybix consults with local legal partners and payroll providers. Get in touch with our experts. We provide you with accurate and up-to-date information.

Ready to optimize your payroll processes? Contact us. Book your free and personalised demo. Discover our data-driven solutions for your business success.

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