Dansk
English

2022 advance tax return: 5 tips to avoid tax leakage

Aske Buemann

CEO & Co-founder

Advance payment 2022

The Tax Agency opened the 2022 advance tax return on 18 November 2021. This year in particular you should pay attention, as last year's tax leakage of over DKK 7 billion is the highest level in 10 years. This is mainly due to the changes brought about by Corona in the tax deductions of Danes. Among other things, Corona has affected all 1.2 million Danes who normally drive to work.

A survey by TaxHelper finds that as many as 50% of Danes did not get their driving deduction updated on their tax return last year. And it's not just driving you need to be aware of. For example, the handyman deduction, which covers green renovations, cleaning, gardening, etc., will be lowered by DKK 30,700 in 2022. Only 13% of Danes are aware of this, according to the same survey.

Want more money back in taxes?

It only takes 15 minutes to try TaxHelper and you'll get an average of DKK 2,704 extra back in tax
At the same time, you only pay if you get a tax saving.

Start here

Here are the 5 key points to avoid tax leakage for 2022

1. Interest on home loans

Around 250,000 homeowners have changed homes during 2021 according to figures from Boligsiden, and thus many face new interest on their mortgages and bank loans. These interest rates are particularly important to get updated, as a 6,000 kr. too high deduction can give a smack of almost 2,000 kr.

2. Driving to work

As mentioned above, one third of Danes stick to at least one working day away from home even after corona. Therefore, it is important for the 1.2 million Danes with driving deductions to have their tax returns updated. For example, if you work from home 2 days a week and have 40 km to work, not getting it updated could result in a hit of almost 3,000 DKK.

3. Changed or lost job

Some industries have had to lay off many workers during the corona while others are short of manpower. So if you have either changed jobs or quit your old job in 2021, it is important to correct your expected salary. If you want to be on the safe side, see our tips for setting income at the bottom of the article.

4. Deduction for crafts lowered by DKK 30,700.

The construction industry has been glowing under the corona, with everyone having more time to renovate homes. However, if you are planning renovations in 2022, be aware that the handyman deduction has been lowered from 50,000 DKK to 19,300 DKK.

5. Renting of accommodation, car, etc.

If you're planning to rent out your home or car now that the world is opening up, it might be a good idea to include your expectations on your tax return. Then you can start the tax year ahead 1-0 and have a much better chance of avoiding tax leakage.

You can't just lower your expected income to avoid tax leakage

If you want to be even more sure of avoiding a tax leak, you can also adjust your income. But far from everyone has to set it lower than they expect:

  • If you earn less than DKK 32,500 a month, you should set your income lower than expected to avoid tax leakage. This is because your employment deduction (the deduction that is set automatically based on your income) will then be set lower.
  • If you earn between DKK 32,500 and DKK 50,000 a month, it doesn't really matter whether you raise or lower your expected income. The tax is adjusted automatically.
  • However, if you earn more than DKK 50,000 a month, you'd better set your income a little too high if you want to avoid tax leakage. This is because you pay top rate tax and will therefore pay a little more tax during the year than you need to.

See if you can get a tax refund in just 15 minutes.

In TaxHelper, we help you find the deductions you're entitled to. You answer a few simple questions that take just 15 minutes to complete.

Then we report the deductions, and you get an extra DKK 2,704 back in tax. At the same time, you only pay if you get a tax saving.

Start here

start today