Everyone who earns a salary subject to labour market contributions or who earns a business profit automatically receives an employment allowance.

  • The maximum employment allowance is 10.50% or a maximum of DKK 39,400 in 2020 (10.10% or DKK 37,200 in 2019).

Everyone who earns a salary subject to labour market contributions or who earns a business profit automatically receives a job allowance also.

  • The job allowance is 4.50% of income over DKK 195,800 or a maximum of DKK 2,600 in 2020 (3.75%, DKK 191,600 and DKK 2,100 in 2019).

The employment and job allowances are calculated as a percentage of your income. However, there is an upper limit to the allowance you can claim.

Employment allowance
Year             %                      Maximum allowance, DKKMinimum amount of salary you need to earn to be entitled to the full allowance
2019 10.10 37,200 DKK 368,317
2020 10.50 39,400 DKK 375,238

 

Job allowance rate
Year % Maximum allowance, DKKMinimum amount of salary you need to earn to be entitled to the full allowance
2019 3.75% of income above DKK 191,600 2,100 DKK 247,600
2020 4.50% o fincome above DKK 195,800 2,600 DKK 253,578

The allowances are calculated automatically on your salary (including labour market contributions (AM-bidrag)) or on your business profit, for example.

If you are a single parent and are entitled to and receive additional child allowance according to the Child Allowance Act, you will receive an additional employment allowance of maximum DKK 22,900 in 2020 (DKK 22,400 in 2019).

If you become a single parent

Udbetaling Danmark will inform the Dansih Tax Agency (Skattestyrelsen) if you become a single parent. This means that you will receive the additional allowance automatically. Udbetaling Danmark informs us on a quarterly basis, and once we have been informed, you will receive a new preliminary income assessment.

Please see our legal guide (in Danish) for further legal information.