Personalegoder – er det bedre end kontanter?

Mette Christiansen

Student thesis: Master thesis


In Denmark, the tax rate is relatively high compared to other EU countries, and employee benefits have become a regular way of compensating employees. The purpose of this thesis is to describe and analyze the specific rules concerning the taxation of certain fringe benefits, and whether they are preferable for wages paid in cash. The primary focus of the thesis is focused on the benefits, that produces tax savings for the employee. The thesis will cover two employee benefits more in depth. The selected employee benefits are company car taxation and multimedia taxation, as both fringes can be used privately and therefore makes it interesting to investigate whether it is viable to receive these benefits instead of cash wages. Besides the above mentioned focus areas, the thesis aims at describing the general tax laws for employee benefits, including the law on financing of employee benefits through gross salary payment, where employer and employee signs an agreement on salary reduction in turn of certain benefits to be provided at the employees disposal. The basis of taxation found in the State Tax Code, § 4, states that taxpayers must pay tax on the total annual income, consisting of both cash and property with a monetary value, regardless if the income is from Denmark or not. The taxpayer would have to pay tax on all legal acquisitions of economic value, unless excepted elsewhere in the legislation. The Assessment Act contains exceptions to the general Law – The Corporate Tax law - regarding employee benefits. Assessment Act § 16 is the basis for valuation of fringe benefits received in exchange for regular wages. Employee benefits are basically set at market value, but the law also contains rules on benefits valued below market value or completely tax free. Accepting benefits as part of salary, makes it possible for the employee to increase the value of wages when employee benefits have a lower taxation or is tax free, which is crucial in the choice of receiving benefits instead of cash wages.

EducationsMSc in Auditing, (Graduate Programme) Final Thesis
Publication date2011
Number of pages98