|Payroll Frequency||Monthly: Paydays vary from the last day of the month to the 15th of the following month.|
|VAT||25% standard rate|
Employer of record Services
TopSource offers complete payroll, EOR and contractor management services for Denmark. TopSource provides Employer of Record services to global companies establishing a presence in Denmark that do not wish to be burdened with the complications of Denmark employment regulations.
TopSource serves as an outsourced Global Employment Solutions provider. We provide comprehensive employment services such as payroll, payroll related compliances, leave and attendance administration, HR management, and assistance with employer compliances.
If you have an established presence in Denmark, our payroll bureau services are available. But if you are seeking to avoid the complications of a subsidiary—or wish to establish a presence quickly an convert to a subsidiary later—our EOR service is ready to support you today.
Services we offer
|• Payroll bureau solutions for your Denmark entity|
|• Employment solutions/leasing||• Providing documents associated with employment|
|• Employee on-boarding process and documentation||• Monthly salary calculation|
|• Salary disbursement to employee’s account||• Pay slip generation (If applicable)|
|• Employee statutory benefits administration and deduction|
|• Foreign exchange and money transfer services for payment of employees and 3rd parties|
Company formation in Denmark
We can help with company registration, company incorporation along with all the necessary documentation in Denmark. We can also assist foreign companies to smoothly setup a company anywhere in Denmark.
- Minimum Wage
There is no official minimum wage however, for public and private sectors, collective bargaining agreement states approximately DKK 110 per hour.
Employer 180 – Social Security Employee 90 – Social Security 8.00% – Up to 50,000 40.20% – 50,000 – 524,282 56.50% – Over 524,282
Working Hours/Vacation DaysFull time employment is 37 hours weekly. Overtime is often compensated with additional time off in lieu of pay.
Vacation Days: Employees are entitled to 5 weeks each full calendar year (25 days).
Sick daysFirst 30 days of the employee’s sick leave is paid by the employer. After the first 30 days, the state pays the sick leave if the employee has been continuously employed by the employer for the last 8 weeks and has worked for at least 74 hours. During leave, employees receive 90% of their salary with a maximum of DKK 4,300 per week or DKK 116.22 per hour.
Maternity/Paternity LeaveMaternity leave: Expecting mothers are entitled to leave of 4 weeks before birth, and 14 weeks after. During this period, they are entitled to 50% wages.
Paternity Leave: New fathers are entitled to leave of 2 weeks before the birth of their child, and 14 weeks after.
Parental LeaveParents have a legal right to 52 weeks pay by the government. This time can be extended by either 8 or 14 weeks, however this will decrease the amount of parental allowance received monthly. One of the parents may choose to defer between 8 to 13 weeks of leave which can be kept as long as it is used before the child is one years old.
Pension/Social SecurityPension: Private pension plans are very common, the average employer contribution can reach 15% of the pensionable salary.
Social Security: Contributions are made both by employee and employer. The average employer contributions are approximately EUR 2,000 per year per for full-time employees. The annual cost for the employee is DKK 1,080, this amount is withheld by the employer.
Termination/SeveranceEmployees are given from 1 month to 6 months’ notice depending on the length of their employment in the business. There is no general statutory regulation on severance pay, but salaried employees who have been in continuous employment for between 12 to 17 years are entitled to a severance payment of between 1 to 3 months’ salary. Some CBAs also include rules on severance pay that depend on seniority.
Holiday AllowanceSalary is paid in 12.24 instalments. Special holiday allowance accounts for the additional 0.24 as it is paid at a rate of 2%. *On September 1, 2020 a new Holiday Act is due to enter into force, which significantly will change the Danish holiday system. (Danish Holiday Act No 60 of 30 January 2018).