A new agreement simplifies the rules for commuters and removes certain tax benefits for selected groups. The new Øresund Agreement, entered into between Denmark and Sweden on Monday, reduces administrative burdens for both commuters and employers, according to a press release from the Ministry of Taxation. The agreement entails changes in the taxation rules for Danish citizens residing in Sweden, and vice versa. In the future, Denmark will be able to tax returns from Danish pension schemes for individuals residing in Sweden. The aim is to make it easier and simpler for both commuters and employers.
Furthermore, the agreement removes a number of tax benefits that according to Minister of Taxation Jeppe Bruus are unreasonable. “We need the labor force of commuters in Denmark. Therefore, this agreement will make it easier for employers to have employees living on the other side of the Sound. At the same time, we are cleaning up a number of tax rules that appear unfair and favor certain groups over individuals living and working in Denmark,” he stated in the press release.
The agreement also affects students. A student who attends university in Denmark and receives Danish State Educational Support (SU), but lives in Malmö, is currently not taxed on their SU under the existing rules since Sweden does not tax support for students. With the updated agreement, Denmark will have the ability to tax recipients of Danish SU, regardless of whether they live in Denmark or Sweden.
The Øresund Agreement was presented on Monday afternoon at a press conference in Malmö by Jeppe Bruus, Minister for Nordic Cooperation Morten Dahlin (V), and Sweden’s Minister of Finance Elisabeth Svantesson. The new rules will come into effect from 2025.