Tax Debt and Payment Plans
Written in plain language for general understanding. This is educational content, not legal advice. Based on Danish Acts of Parliament (love), executive orders (bekendtgørelser), and official government guidance.
Danish National Law
What is this right?
If you owe tax debt in Denmark, Gældsstyrelsen (the Debt Collection Agency under Skatteministeriet) handles recovery:
- Payment agreement: You can request a payment plan (afdragsordning) — Gældsstyrelsen will set monthly instalments based on your ability to pay.
- Budget calculation: Your ability to pay is assessed using a standardised budget — income minus necessary expenses equals your available payment capacity.
- Interest: Outstanding tax debt accrues interest — the rate is published annually.
- Enforcement: If you do not pay or enter into an agreement, Gældsstyrelsen can garnish wages (lønindeholdelse) or seize assets.
- Debt relief (gældssanering): In extreme cases, you can apply to the court for a formal debt restructuring order.
When does it apply?
- You owe back taxes (restskat) and cannot pay the full amount.
- You have received a demand letter from Gældsstyrelsen.
What should you do?
- Contact Gældsstyrelsen promptly — proactive engagement leads to better payment terms.
- Request a payment plan and provide accurate financial information.
- If you cannot pay at all, ask about temporary suspension of collection (henstand) or consider applying for gældssanering.
- Pay at least the agreed instalments — defaulting on a payment plan triggers escalation.
What should you NOT do?
- Don't ignore demand letters — Gældsstyrelsen will proceed to wage garnishment without further warning.
- Don't hide income or assets — this is a criminal offence and will worsen your situation.
- Don't wait for the debt to go away — tax debts do not expire easily under Danish law.
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