Payroll in Denmark 2026: AM-bidrag, A-skat, ATP and holiday pay

In Denmark the employer deducts the labour market contribution (AM-bidrag, 8%), the employee's ATP pension share and A-skat as instructed by the employee's eSkattekort, then reports pay monthly in eIndkomst. The main employer charge on top is its ATP share, DKK 198 a month for a full-time employee in 2026, collected together with other statutory contributions.

Payroll in Denmark at a glance

Social security contributions

Danish payroll has two main contributions: the labour market contribution, a gross charge on earnings withheld from the employee, and the ATP supplementary pension, shared between employee and employer.

AM-bidrag. The employer withholds 8% of the pay before A-skat. The employee's ATP share is left out of the base because ATP pays the 8% on the contributions itself. From 1 January 2026 young people are exempt until 31 December of the year in which they turn 17.

ATP. Employees working at least 9 hours a week are covered. The 2026 amounts for monthly-paid employees in private companies depend on hours worked:

Weekly-paid employees with at least 27 hours a week pay DKK 26.10 and their employer DKK 52.20 a week.

Income tax on salaries

The employer orders an eSkattekort when it adds a new employee in TastSelv Erhverv; it is usually ready within two hours. The card tells the employer which withholding rate and monthly deduction to use, so the employer does not calculate the tax itself.

The withholding reflects these 2026 rules:

Personal income is the pay after AM-bidrag. Taxable income is personal income minus deductions, and the personal allowance is DKK 54,100. A tax ceiling of 44.57% caps the combined rate on personal income.

Two work-related deductions are given automatically and reduce taxable income: the employment deduction (beskæftigelsesfradrag) of 12.75% of pay including AM-bidrag, up to DKK 63,300 (the maximum is reached at DKK 496,471), and the job deduction (jobfradrag) of 4.5% of income above DKK 235,200, up to DKK 3,100.

Already set for 2027: the personal allowance rises to DKK 55,700, the middle tax threshold to DKK 659,900, the top tax threshold to DKK 800,500 and the top-top threshold to DKK 2,668,200; the maximum employment deduction becomes DKK 65,200.

Minimum wage, working time and mandatory pay

No statutory minimum wage. Denmark has no minimum wage set by law. Pay and conditions are regulated by collective agreements or negotiated individually, and collective agreements typically set overtime pay, including for Sunday work, and evening and night supplements.

Holiday. Every employee earns 2.08 days of paid holiday per month of employment, 25 days for a full year, whether full-time or part-time. Holiday is earned from 1 September to 31 August and can be taken from 1 September up to 31 December of the following year; the main holiday of three consecutive weeks is normally taken between 1 May and 30 September.

• Salaried employees keep their normal pay during holiday and receive a holiday supplement (ferietillæg) of 1% of their pay for the holiday year; a collective agreement may set a different rate.
• Employees without pay during holiday, for example hourly-paid staff, receive holiday pay (feriepenge) of 12.5% of their pay before AM-bidrag and A-skat, paid out when they take the holiday.

Monthly payroll calendar and filings

1. 1Register as an employer on virk.dk before you report any pay, then get access to eIndkomst.
2. 2Order the eSkattekort for each new employee in TastSelv Erhverv.
3. 3Withhold A-skat, AM-bidrag and the employee's ATP share every pay run.
4. 4Report pay in eIndkomst every month, including A-income, holiday pay, hours, A-skat, AM-bidrag and ATP; report zero in a month without pay.
5. 5Pay A-skat and AM-bidrag to the company's tax account (Skattekontoen). The deadlines depend on how the company is registered: as a small or medium-sized business (the general registration for private companies) or as a large business, which applies when AM-bidrag exceeds DKK 250,000 or A-skat DKK 1 million a year. The registration certificate in TastSelv Erhverv shows which calendar applies, and Skattestyrelsen reviews it each November. Interest runs from the original deadline if you pay late.
6. 6Pay ATP through Samlet Betaling, which collects it together with other statutory contributions.
7. 7Give a payslip every month showing gross and net pay, A-skat, AM-bidrag, pension contributions including ATP, holiday pay and the pay date.

Worked example: DKK 40,000 a month

A full-time salaried employee earns DKK 40,000 a month (DKK 480,000 a year), lives in a municipality with a 25% municipal tax rate, is not a church member and has no other income or deductions. The annual calculation shows what the eSkattekort spreads over the months.

AM-bidrag and income tax together take 34.43% of gross pay in this example. In a municipality with a different rate, or for a church member, the withholding rate on the eSkattekort will differ.

Common mistakes

1. 1Withholding AM-bidrag from young employees who are exempt from 2026 until the end of the year they turn 17.
2. 2Calculating A-skat by hand instead of using the withholding rate and deduction on the current eSkattekort.
3. 3Using the wrong ATP tier for part-time staff, whose amount depends on hours worked.
4. 4Skipping the monthly eIndkomst report in a month without pay instead of reporting zero.
5. 5Mixing up holiday pay and holiday supplement: salaried staff keep their pay plus 1%, others receive 12.5%.
6. 6Paying late: interest runs from the original deadline, and the former 14-day payment grace period ended on 1 July 2023.

How Clientlly helps

Clientlly does not ship a built-in payroll profile for Denmark. An administrator enters the Danish payroll rates once in the payroll tax settings: the income-tax bands, the personal allowance, the employee and employer contribution rates and the minimum wage. Clientlly then calculates gross to net and the employer contributions and produces payslips. Because A-skat follows each employee's eSkattekort, check the tax amounts against the withholding rate and deduction on the card.

Alongside payroll, the human resources module handles leave requests and approvals with a leave calendar, useful for tracking holiday days, and keeps HR documents, and attendance and time tracking records working hours and overtime.