What is lønsumsafgift (payroll tax)?

In short

Lønsumsafgift is the tax VAT-exempt sectors (e.g. healthcare, education and finance) pay instead of VAT — typically calculated on the payroll or payroll plus profit.

In practice

Run a clinic with VAT-exempt treatment, and you typically register for payroll tax instead of (or alongside) VAT. The rate depends on the sector.

Related terms

• Moms (Danish VAT)
• Momsregistrering (VAT registration)
• See every term in the dictionary

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