# US Citizen going to Denmark of Skilled Work Visa, trying to bring spouse with me. TAX HELP!



## mitchpel (1 mo ago)

I currently have a great opportunity to move to Denmark on a Skilled Work Visa which grants me residence. My spouse will be trying for a family accompanying visa to also get residence so we can be together. She plans on staying employed with her US-based company as she works remotely. My question is what are her tax implications?? Would she have to pay the higher Danish tax? Would she get a tax exclusion? What exactly would her tax rate be?


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## Harry Moles (11 mo ago)

This would be complicated. Generally speaking, your first obligation is to pay tax in the country where you live, so yes, she would owe taxes to Denmark. Then she would use FEIE and/or FTC to reduce or eliminate her US tax bill. However, if she's working while living in Denmark, both she and her American employer would be obliged follow Danish labour laws and make all social insurance contributions (health care, pension, etc.). Once employers are aware of these liabilities they generally decide they would rather not have a full-time salaried employee located permanently in another country.

There are three options, then:

1. She transfers to a Danish or European branch of her company, if that exists.

2. She is hired through a local employer-of-record firm, which handles Danish payroll and makes the appropriate deductions for tax and social insurance charges. This comes at some extra cost, so she would need to negotiate with her employer.

3. She resigns her position as an employee and begins working as a contractor. She would need to set up as self-employed in Denmark, to pay all taxes and social insurance charges due, and would still be required to file US tax returns, though presumably with little or nothing owed due to FEIE or FTC.

To figure out her Danish tax bill, look for an online calculator. I have no idea how it works in Denmark but if she's self-employed it's possible that she will pay higher social insurance charges (in Germany, freelancers are responsible for the employer portion of their public health insurance premium, which is not a small amount of money).


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## Moulard (Feb 3, 2017)

Harry is spot on here... 

Some countries do have have de-minimus rules (typically 90-120 days) where you could work in country without the employer having to comply with domestic tax, witholding etc rules.

I don't know about Denmark per se, but that could be used as part of a transition while you set up 1, 2 or 3.

There are companies out there that will close their eyes, cover their ears, and sing La La La and ignore all of it. If that was the case, then she would be able to File 673 to claim an exemption from Federal Income Tax withholding, and would have to report her US income to Danish tax authorities. 

As has been implied above, dependent personal services (ie wages, salary etc) earned while physically in Denmark would be considered sourced in Denmark, and Danish authorities would have the primary right to tax the income. Assuming you spouse is a US Citizen or Greencard holder, she would be able to use either foreign tax credits of the FEIE to reduce the US tax liability on that foreign sourced income.

Her US employer would have to apply for a certificate of coverage from the SSA to avoid having to contribute both into US and Danish Social Security Systems. 

If she went down option 3 in the long term, again assuming she is a US Person, then she would need to obtain a Danish certificate of coverage to avoid US Self Employment taxes.

This link will help with more details on the social security side of things.






Description of the U.S.- Denmark Social Security Agreement


This page provides information on how to avoid dual U.S. and Denmark Social Security taxes, as well as how to apply for benefits under the U.S. social security agreement with Denmark.



www.ssa.gov


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