Save money with the special service tax reduction scheme

The current tax reduction, called “boligjobordning” is in place for 2018 and 2019. Take advantage of it to deduct costs for housekeeping, window cleaning, gardening services, babysitting or renovations in your home.

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By Bente D. Knudsen

In 2018 and 2019, the law allows every citizen to deduct certain costs from their income, if  they can present receipts for the work done and there is a CVR number on it.

Each business entity has a CVR number, which identifies the business the same way a CPR number identifies a person.

If the service was done by a private person (for instance babysitting), then the person must put in writing that they performed the service and add their CPR number.

You do not have to own your home, the tax deduction is also valid for tenants as long as they had to pay the cost themselves and were living in the home when the  work was done.

You can only deduct labour costs, and not the materials used, as the whole idea of the boligjobordning is to create more jobs and reduce “sort arbejde”, or moonlighting/ undeclared work.

With the high cost of wages, it is interesting to do so, and many Danes take advantage of this tax reduction.

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You have an amount which can be deducted for so-called service charges (cleaning, babysitting, gardening and window cleaning) of DKK 6,000, whereas DKK 12,000 can be deducted for household renovations, but only if they contribute to making your home more environmentally friendly, such as windows that isolate better, or other measures enabling to consume less energy, water etc.

The total tax deductible amount in 2018 is DKK 18,000 per adult in your household (above 18).

It is not too late to file it for your 2018 income, as the work done in 2018 just has to be paid to the handyman, gardener, babysitter etc. before 28 February 2019.

If you file it by this date, it will become deductible on your 2018 income.

You must have paid the receipt electronically with a credit card, Mobilepay or a bank transfer. Cash payments are not deductible.

According to SKAT, the value of the service deduction is 27 percent. So, if you can deduct DKK 3,000, you will save DKK 810 on your income tax.

On the home page of SKAT you can find detailed descriptions of what kind of service cost is deductible, Danish only – but with Google translate you should be able to find out if it is relevant for you.

The tax reduction is split in two:

In 2018 the service reduction is DKK 6,000 per person above the age of 18 in your household and the handyman reduction ( håndværkerfradrag) is DKK 12,000 per person in your household.

In 2019 they are DKK 6,100 and 12,200 respectively.

Find more information on SKAT’s home page here:

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