Denmark Tax Agency Clarifies Taxation of Agreements on Share-Based Incentive Programs

The Danish Customs and Tax Administration March 4 posted Tax Council Binding Answer No. SKM2026.118.SR, clarifying the taxation of agreements on share-based incentive programs. The taxpayer, a Danish company, operated both a stock option plan and a restricted share units plan. The taxpayer sought clarification on various issues, including whether the two programs, if granted simultaneously, could both initially fall under the Tax Assessment Act’s 10 percent annual salary limit, with employees choosing later which instruments would receive treatment, and whether the two agreements could be consolidated into a single agreement. Upon review, the Tax Council found that: 1) two ...