TaxWatch:

New tax-free gift cards

29 March 2021

Tanya Honoré Schultz , Director, Tax Legal |

The Danish Parliament has just passed a bill which makes it possible for both private and public employers to give tax-free gift cards to their employees.

The new law already applies, and for the rest of 2021, employers can therefore give their employees a gift card as a thank you for their efforts. It is also a good opportunity to support the local business community, which has been particularly challenged over the past year.

The rules apply to gift cards up to an amount of DKK 1,200. In addition, there are rules for who the gift cards may be given to and what they may be used for.
 

The use of tax-free gift cards

The new rules only apply to gift cards that can be used to pay for one or more of the following specific services:

  • Purchase of food and drinks at restaurants
  • Purchase of accommodation
  • Purchase of cultural experiences
  • Purchase of package tours.

It will not be possible to give tax-free gift cards if they are bought from a local shop association or for a shopping mall in general, because these gift cards may also be used for purchases in, for example, a clothing store or at a hardware store.

On the other hand, a gift card for a theater, which besides paying for  e.g. a musical ticket, can also be used for food and drink in the foyer and for the purchase of merchandise at the theatreshop, because the latter is only seen as a secondary income to the theatre.
 

Learn more about gift card rules

On April 9, we host a free webinar, where you and / or your colleague can get an overview of the new rules.

NOTE: The webinar is in Danish.

Sign up for the webinar here