Salary Calculator
Denmark

A salary calculator for Denmark estimates both gross and net earnings by considering various components. It starts with the gross salary, which includes base pay, bonuses, and additional compensation. Then, it applies Denmark’s progressive tax rate.

The calculator also includes social security contributions from both the employee and employer, which help fund essential services like pensions and healthcare. After deducting all taxes and contributions, the result is the net salary—the amount the employee takes home.

Denmark has relatively low employer-paid social contributions compared to other European countries. These include labour market contributions (AM-bidrag), which are around 8% of the gross salary.

There might also be some other employer contributions, such as occupational injury insurance, which vary by industry. Plus, employers often contribute to employee pension plans, usually around 8-12% of the salary.

Denmark applies progressive tax rates, meaning higher-income earners pay a higher percentage of their income. The municipality tax ranges from 22% to 27% of taxable income.

If an individual is a member of the Church of Denmark, they should be subject to an additional 0.5-1% tax. 

*Please note that these tax rates can vary based on legislative changes.

Employees are entitled to 25 days of paid vacation per year under the Danish Holiday Act. Some companies offer more than the statutory minimum, providing up to 30 vacation days or more as part of their compensation packages. Employees typically receive a holiday allowance of 12.5% of their annual salary to be paid during their vacation period.

In addition, mothers are entitled to 4 weeks of leave before the birth and 14 weeks after the birth, during which they receive a state allowance. Fathers are also entitled to 2 weeks of leave within the first 14 weeks after the birth. Parents can share an additional 32 weeks of parental leave, and both parents can take advantage of flexible leave arrangements.

During sick leave, the first 30 days are covered by the employer. After this period, the municipality steps in with statutory sickness benefits.

In Denmark, employers typically contribute to pension schemes, with contributions often ranging from 8-12% of the salary. Although the country has universal healthcare funded by taxes, some employers offer additional private health insurance as an extra benefit.

In Denmark, a salary calculator is essential for understanding the difference between gross and net salary. Gross salary refers to an employee’s total income before any deductions, encompassing base pay, bonuses, and other compensation specified in the employment contract. It represents the full financial agreement between employer and employee.

Net salary, on the other hand, is the amount employees take home after mandatory deductions from the gross salary. In Denmark, these deductions typically include income tax, social security contributions, and health insurance.