The new Øresund Agreement
2025-01-09
Sweden and Denmark have signed a new Øresund agreement that camer into effect on 29 December 2024. The agreement applies to tax on income from the income year 2025 (annual assessment 2026).
The agreement contains news for those who commute between Sweden and Denmark. One important change is that the agreement applies regardless of whether you have a private or public employer.
You will be taxed on your entire salary in the country where you normally work if you work there for at least half of your working hours in each 12-month period. If you live in Denmark and work in Sweden, you are taxed in Sweden. This also applies if you work remote (e.g. in your home) or elsewhere in Denmark, or if you are on temporary business trips outside your country of work, Sweden.
The Øresund Agreement only applies if the salary is not charged to a permanent establishment that your Swedish employer has in Denmark.
If you don't fulfil the conditions of the Øresund Agreement, the taxation of your salary will be based on the number of active working days in each country. This means that you pay tax in Sweden for the days you have worked there and you pay tax in Denmark for the days you have worked there.
Living in Sweden: You don't need a tax exemption ruling
If you live in Sweden, normally work in Denmark and fulfil the conditions of the Øresund Agreement, i.e. you work at least 50 % of your working hours during a 12-month period in Denmark, your Danish employer does not need to deduct tax in Sweden. You no longer need a tax exemption decision from the Swedish Tax Agency.
However, if you do not fulfil the conditions of the Øresund Agreement, your Danish employer must still register as an employer in Sweden and deduct Swedish withholding tax on income from work in Sweden.
Other news in the Øresund Agreement
The new Øresund Agreement also brings other rule changes. If you live in Sweden and have pension savings in Denmark, you were previously exempt from Danish pension yield tax (PAL tax). However, from 2025 you will have to pay this 15.3 % tax on an equal basis with those living in Denmark.
Another change is that if you live in Sweden and receive Danish SU, you will now pay tax in Denmark on this income.
If you live in Denmark and receive a Swedish student grant, you no longer have to pay tax on your student grant in Denmark.
Our websites are updated regularly
The new Øresund Agreement enters into force on 29 December 2024 and applies to income from 2025 onwards. It will therefore not affect your annual tax return and declaration for 2024, which must be submitted in May 2025. For 2024, the previous Øresund Agreement from 2003 applies.
We will update the information about the Øresund Agreement continuously. We will also continuously update our articles with information on how it may affect you, how to count working days, and how to deal with the annual tax return and declaration for 2025, which must be submitted in 2026.
Read more about the Øresund Agreement on skat.dk (in danish)
Read more on skatteverket.se (in Swedish)
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