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The annual tax return for 2024 is officially out on March 24, which means it's time to check if you can look forward to excess tax or if you should prepare for a tax overpayment.
At TaxHelper, we've identified over DKK 313 million in tax deductions that Danes had overlooked since 2021. And now we're ready with our top 5 tips on how to make sure you get the most back in tax for your 2024 tax return.
Many people mistakenly believe that all relevant tax deductions are automatically included in the annual tax return. But the reality is different, and it often takes extra effort to make sure you get it all.
Aske Buemann, co-founder of TaxHelper, emphasizes the importance of being proactive: "Many Danes struggle with the manual mileage deduction in particular, and homeowners should pay special attention to deductions in connection with loan conversions in 2024. The mileage deduction is essential again this year as it is not automatically reported by SKAT, which can surprise many and potentially lead to a tax hit. Last year, almost 1 million Danes experienced this."
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.
Here are the 5 deductions that we at TaxHelper find most people miss out on. These are some of the deductions that most people get help with on our platform, where our users find an average of just over DKK 10,000 in missed deductions. So there can be a lot of money to be found.
Although the mileage deduction is one of the most common deductions that over a million Danes use annually, it is still one of the biggest sources of overlooked deductions. One of the main reasons for this is that SKAT's pre-entered information is not always correct, explains Aske Buemann: "We regularly see cases where the distance SKAT has calculated for work does not match the actual driving distance. This is typically in urban areas where the fastest route via highway can be longer than the shortest route through the city. In such situations, it is permitted to state the actual driving distance instead of the shortest route proposed by SKAT."
A further complication is that in recent years, the mileage deduction has not been automatically included in the annual tax return. The auditing firm BDO has estimated that this has resulted in up to DKK 680 million in tax deductions being lost for more than 40,000 citizens. It is therefore crucial to check and correct the mileage deduction manually in your annual tax return.
Many homeowners took advantage of the fluctuating interest rates in 2024 to refinance their mortgages for a capital gain. It is important to be aware of the various fees paid to banks and mortgage lenders, as these can lead to significant tax deductions.
"The 'guarantee commission' and 'differential interest' fees are examples of deductions that homeowners often overlook, but which can amount to deductions of up to DKK 20,000. These deductions are relatively unknown and our experience shows that they are rarely reported correctly by the citizens themselves", Aske Buemann points out.
For homeowners and tenants, there's particularly good news in the 2024 annual tax return, as the service deduction has been significantly increased. In 2024, the maximum service deduction per person has almost doubled to DKK 11,900 incl. VAT (compared to DKK 6,600 in 2023).
The increased service deduction in 2024 will allow you to save even more money in tax if you have used cleaning, window cleaning, childcare or gardening services during the year. Make sure to check if you have invoices for the services that qualify for the service deduction and remember to report them correctly in your annual tax return.
Although many banks and financial institutions operate in Denmark and automatically report interest information to SKAT, there are exceptions. Some banks do not have a formal "place of business in Denmark" and therefore do not report automatically. Examples of this are Ferratum and Bank Norwegian, which are based in Malta and Norway respectively. If you have loans with these or similar banks, you will need to enter the interest expenses in your annual tax return, which can be significant amounts that qualify for deductions.
Epinion has previously estimated that up to 1 million Danes annually forget to take advantage of the travel deduction. If you have participated in courses, conferences, travel or similar in connection with your work, you may be entitled to a deduction even if your employer has covered the cost of board and lodging. The deduction can amount to up to DKK 5,000 per week and primarily requires that you have had at least one overnight stay away and have been away for more than 24 hours.
Aske Buemann explains: "The rates and calculation of the travel deduction are adjusted annually, and SKAT's own data shows that there are errors in the calculation in about every third case. Many people mistakenly believe that the travel deduction only applies to long trips abroad, but this is not correct. What matters is that you've been away for at least 24 hours and had to spend the night out - then there's potential for a deduction."
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.
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