Denmark – New Rules for Recruitment of Foreign Specialists

Denmark – New Rules for Recruitment of Foreign Sp...

Denmark is implementing a new Fast Track procedure as a means of making it easier to recruit highly qualified employees/specialists to come to work in Denmark and strengthen the competitive edge of Danish companies. Also, with effect from January 1, 2015, the minimum salary under the Special Taxation Scheme for Key Employees will be reduced by DKK 10,000.

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Denmark has decided to implement a new Fast Track procedure and amend the Special Taxation Scheme for Key Employees from 1 January 2015, as a means of making it easier to recruit highly qualified employees/specialists to come to work in Denmark and strengthen the competitive edge of Danish companies.1  

Why This Matters

These amendments2 to Denmark’s rules aim to provide companies in Denmark a faster and more flexible recruitment process, as well as to expand the available pool with respect to highly qualified international foreign specialists who can come to work in Denmark.  There are new possibilities for companies that wish to obtain work permissions for certain highly qualified foreign employees. 

Fast Track Procedure

The Fast Track procedure will grant foreign employees work permission just after arrival in Denmark after submitting an application and getting an interim permit from the Danish Agency for Labor Market and Recruitment (STAR) instead of awaiting the legal proceedings at STAR, which typically takes four weeks.  The approval, in accordance with the Fast Track procedure, requires that the company be certified by STAR.  Companies can apply for certification from 1 January 2015.

Requirements

The requirements for a foreign employee to apply under the Fast Track procedure are:

  • the foreign employee is offered a basic salary of DKK 375,000 annually, or
  •  the foreign employee is a researcher, or
  • the employment requires a placement of highly qualified level of education, or
  • the foreign employee’s stay in Denmark does not exceed a period of three months from the first day of arrival in Denmark.

Aspects of Fast Track and Other Advantages

Under the Fast Track procedure, the foreign employee will have the opportunity to work alternately in Denmark and abroad, without termination of his or her Danish work permit.

A foreign employee under the Fast Track recruitment procedure will be able to work in Denmark while his or her application is still processing/pending at STAR, instead of waiting for a final approval of work permit from STAR.

As a result of this change in Denmark’s law and the implementation of the Fast Track procedure, the previous Corporate Scheme3 will be terminated.  STAR will be issuing notices to all companies currently availing of the Corporate Scheme about the implications of the Fast Track procedure and the transition from the Corporate Scheme to the Fast Track procedure.

Tax - Special Taxation Scheme for Key Employees

With effect from 1 January 2015, the minimum salary under the Special Taxation Scheme for Key Employees (“the Special Scheme”) will be reduced by DKK 10,000.  In 2015, the minimum salary will now be DKK 61,500 compared with DKK 71,600 in 2014.  The purpose of this change is to expand the pool of key employees with access to Denmark’s labor market under the Special Scheme.

Footnotes

1  For more on the reform of international recruitment (en reform af international rekruttering) agreed by the governing parties, see:   http://bm.dk/da/Aktuelt/Politiske%20aftaler/International%20rekruttering.aspx .

See the 22-page government document “Aftale om en reform af international rekruttering – Lettere adgang til højtkvalificeret arbejdskraft.”

2  Udlændingeloven and Kildeskatteloven.

3  The corporate scheme is a way to transfer employees with special abilities or qualifications from the company’s foreign departments to Denmark to work on a project or to carry out work that is innovative or educational in nature.  While the permit is valid, the employee can alternate between working in Denmark and abroad without the permit lapsing.

 

Footnotes:

1  For more on the reform of international recruitment (en reform af international rekruttering) agreed by the governing parties, see:  http://bm.dk/da/Aktuelt/Politiske%20aftaler/International%20rekruttering.aspx.

See the 22-page government document “Aftale om en reform af international rekruttering – Lettere adgang til højtkvalificeret arbejdskraft.”

2  Udlændingeloven and Kildeskatteloven.

3  The corporate scheme is a way to transfer employees with special abilities or qualifications from the company’s foreign departments to Denmark to work on a project or to carry out work that is innovative or educational in nature.  While the permit is valid, the employee can alternate between working in Denmark and abroad without the permit lapsing.

 

 *     *     *     *

DKK 1 = EUR 0.134

DKK 1 = GBP 0.1056

DKK1 =  USD 0.1635

 

For additional information or assistance, please contact your local GMS or People Services professional or the following professional with the KPMG International member firm in Denmark:

Pernille Paisen (tel. +45 3078 6608; e-mail:Pernille.Paisen@accuratax.dk)

The information contained in this newsletter was submitted by the KPMG International member firm in Denmark. The information contained herein is of a general nature and based on authorities that are subject to change. Applicability of the information to specific situations should be determined through consultation with your tax adviser. 

 

Footnotes:

1  For more on the reform of international recruitment (en reform af international rekruttering) agreed by the governing parties, see:  http://bm.dk/da/Aktuelt/Politiske%20aftaler/International%20rekruttering.aspx.

See the 22-page government document “Aftale om en reform af international rekruttering – Lettere adgang til højtkvalificeret arbejdskraft.”

2  Udlændingeloven and Kildeskatteloven.

3  The corporate scheme is a way to transfer employees with special abilities or qualifications from the company’s foreign departments to Denmark to work on a project or to carry out work that is innovative or educational in nature.  While the permit is valid, the employee can alternate between working in Denmark and abroad without the permit lapsing.

 

 *     *     *     *

DKK 1 = EUR 0.134

DKK 1 = GBP 0.1056

DKK1 =  USD 0.1635

 

For additional information or assistance, please contact your local GMS or People Services professional or the following professional with the KPMG International member firm in Denmark:

Pernille Paisen (tel. +45 3078 6608; e-mail:Pernille.Paisen@accuratax.dk)

The information contained in this newsletter was submitted by the KPMG International member firm in Denmark. The information contained herein is of a general nature and based on authorities that are subject to change. Applicability of the information to specific situations should be determined through consultation with your tax adviser. 

DKK 1 = EUR 0.134

DKK 1 = GBP 0.1056

DKK1 =  USD 0.1635  

For additional information or assistance, please contact your local GMS or People Services professional or the following professional with the KPMG International member firm in Denmark:

Pernille Paisen (tel. +45 3078 6608; e-mail: Pernille.Paisen@accuratax.dk) 

The information contained in this newsletter was submitted by the KPMG International member firm in Denmark. The information contained herein is of a general nature and based on authorities that are subject to change. Applicability of the information to specific situations should be determined through consultation with your tax adviser.

© 2016 KPMG Statsautoriseret Revisionspartnerselskab, a Danish limited liability company and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

Flash Alert is an Global Mobility Services publication of KPMG LLPs Washington National Tax practice. The KPMG logo and name are trademarks of KPMG International. KPMG International is a Swiss cooperative that serves as a coordinating entity for a network of independent member firms. KPMG International provides no audit or other client services. Such services are provided solely by member firms in their respective geographic areas. KPMG International and its member firms are legally distinct and separate entities. They are not and nothing contained herein shall be construed to place these entities in the relationship of parents, subsidiaries, agents, partners, or joint venturers. No member firm has any authority (actual, apparent, implied or otherwise) to obligate or bind KPMG International or any member firm in any manner whatsoever. The information contained in herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation.

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