The government of Denmark believes in a thriving sharing incoming in the country, with their new purposed regulations.
“We want a flourishing sharing economy in Denmark. Where it is possible for renters to earn a reasonable tax-free amount on making their property available,” said the Danish tax minister Karsten Lauritzen.
“But it is under the condition that tax payments are in order,” he added. (Reuters)
First of all, on May 17, 2018, Denmark announced their purposed new regulations with Airbnb. The two major regulations being: a cap on the number of nights a homeowner is able to rent, and also Airbnb will automatically report your income to the Danish Tax Authorities (Skat), rather than you having to do it yourself.
Here is a breakdown of those new regulations and what it means for you.
Clear Home Sharing Regulations
The regulations make it clear for sharing your home to guests from around the world is welcome in Denmark.
Currently, calculating tax on Airbnb earnings in Denmark is complicated. There are different levels based on the type of property you have, property value, and rental costs of the property. With the new purposed regulations most noteworthy your taxes will be a breeze to understand.
You as a homeowner will be able to earn 28,000dkk for your primary home and 40,000dkk for a holiday home. This is tax-free. This is only for using platforms-Airbnb- that are collaborating with the Danish government. Homeowners that do not use collaborating platforms can only earn 11,000dkk tax-free.
Paying your taxes will be easier than ever once Airbnb automatically sends your earnings to Skat. Since calculations will be made for you.
Number of nights you can rent
The Danish government will put a cap on the number of nights you as a homeowner can rent your primary home for, that number being 70 nights/year. The Danish government will give power to local authorities to increase this cap to 100 nights/year. This is for hosts renting on platforms that are collaborating with the Danish government. Rather than a cap of 30nights/year when using a platform that does not collaborate with the government.
Strict privacy rules
Additionally, all data shared between collaborative platforms and the government will be subject to strict European and national privacy rules and will only be used to support accurate income tax payment.
Finally, the Danish government will discuss and vote on the proposal in upcoming months.