A new tax landscape: Key takeaways from Denmark's 2026 coalition agreement

Some changes will take effect quickly, while others will be shaped by commissions and enacted through legislation still to be developed.

Below we have set out the key points.

The corporate income tax rate is to be lowered by three percentage points over three years, from the current 22% to 19%. The phasing is gradual, and the timing of the first reduction has not yet been specified. It remains open whether the changes will apply from the income year 2026 or 2027. However, the financial sector is explicitly excluded from the full reduction.

A tech tax is also to be introduced with the specific aim of ensuring that major technology companies contribute more to European public finances, though no detail on scope or design has been provided.

Deductions for research and development are to be adjusted and better targeted. No further detail is provided as to how the deductions are to be adjusted.

Personal income tax
The recently introduced top-top tax (in force from 2026), which levies an additional five percentage points on personal income above approximately DKK 2.6 million is to be abolished. The marginal tax rate on earned income will therefore once again be approximately 56%, including AM contributions. At the same time, the middle tax will also be abolished, leaving only a bottom tax on income up to DKK 777,900 and a 15% top tax on income above that threshold. The effective date of the personal tax reform has not been specified.

At the same time, thresholds in tax legislation which are normally increased yearly according to index-linking will be held at the current levels for a two-year period.

For principal shareholders, a new principal shareholder model is to be designed to ensure that, even following the cut in the corporate tax rate, the overall tax burden on principal shareholders remains close to the marginal tax rate applicable to top-rate salaried taxpayers. 

Share income and investments
Multiple changes combine to make equity investment materially more tax-efficient:

• The threshold for the lower 27% rate on share income is to be raised from the current DKK 79,400 (for 2026) to DKK 110,000.
   
• The investment ceiling for the equity savings account (Da. aktiesparekonto) is to be raised from DKK 174,200 to DKK 500,000. Investments under this scheme are currently taxed at 17% on capital gains subject to mark-to-market taxation. Going forward, the ceiling will be based on the original amount invested, rather than on the current market value of the account. It is further to be examined whether the annual mark-to-market taxation can be replaced by a simpler model, with the Norwegian Aksjesparekonto, which uses a net withdrawal taxation approach, cited as a point of inspiration.
   

Limitation on interest deductions
This is one of the most significant structural changes for private individuals. A cap is to be introduced on interest deductibility where single taxpayers will be limited to deducting interest on DKK 150,000 per year, whilst spouses may jointly deduct up to DKK 300,000. Today there is no such cap.

The proposed changes are likely to have a large impact for highly leveraged homeowners and private property investors, necessitating a review of financing arrangements that rely on full interest deductibility.

Capital gains taxation on private residence
Whereas capital gains on private residences have not earlier been taxed, a commission is to be established to assess different models for a new limited capital gains tax on realised property profits, alongside a corresponding reduction in the ongoing property value tax. Any recommendations must be framed around ensuring that no homeowner is exposed to capital gains tax on value increases already accumulated at the time the new rules are implemented. The commission will further examine whether the property value tax can be reduced or even eliminated for lower-value properties.

The commission's remit will also extend to the generational inequality in the housing market and the barriers facing first-time buyers, including an examination of whether stamp duty (Da. tinglysningsafgift) can be reduced or abolished entirely for this group. 

The inheritance tax provisions contain two key measures.  The inheritance tax threshold is to be raised from DKK 392,300 to DKK 550,000. For smaller estates, this is straightforwardly positive.

For larger estates, the picture is different. On estates exceeding DKK 10 million, an additional 15% inheritance tax layer is to apply, bringing the aggregate tax rate up to 30%.

Nothing is stated about the future for the relatively new reduced 10% tax rate available on the succession-eligible transfer of business assets. Furthermore, nothing is mentioned about gift tax, which historically has followed the same tax rates as inheritance. In practice, this should make it even more important for early succession planning.

VAT on fruit and vegetables is to be removed entirely, and VAT on other food is to be halved, from the current 25% to approximately 12.5%. The Government has committed to implementing the reductions as quickly as is technically feasible.

The duty on chocolate and confectionery that was recently lowered will be maintained. The already planned abolition of VAT on books is also to be implemented.

A capital taxation reform commission is to be established with a remit to recommend how more capital can be freed up for businesses, how tax rates can be harmonised and simplified, and how the use of employee shares, warrants, and options can be broadened.

Separately, a new entrepreneur package is to be developed, aiming at improving access to capital, expanding the use of employee financial instruments, and strengthening the financial security of founders.

Much of what has been announced will take months or even years to plan and enact. Commissions are to be appointed, recommendations issued, and legislation drafted. Yet several changes are intended to be made quickly.

For the property capital gains tax specifically, any new regime can at the earliest enter into force following the next general election, given the constitutional requirement that new property taxes cannot take effect without a prior election mandate.

That said, several areas call for immediate attention. Practitioners and their clients should not wait for final legislation before reviewing existing arrangements in the following areas in particular:

• Succession and inheritance planning – the introduction of a new 30% rate on estates exceeding DKK 10 million creates an urgent need to revisit succession structures, particularly where business assets are involved. The silence of the policy statement on the continued availability of the 10% business succession rate and on gift tax adds further uncertainty. But for now, larger gifts where the requirements for the 10% business succession rate are not met, should be considered. 
   
• Interest deductibility – the proposed cap of DKK 150,000/300,000 will materially affect highly leveraged individuals, including private property investors and homeowners with significant mortgage debt. Existing financing structures that rely on full interest deductibility should be reviewed promptly.
   
• Principal shareholders – the interaction between the lower corporate tax rate and the new principal shareholder model is yet to be designed. Until the model is known, principal shareholders face real uncertainty as to their future overall tax burden.
   

We will continue to monitor legislative developments closely and will provide further updates as the details emerge.