Planning a business trip to (or within) Denmark soon? If you’re an accountant or finance manager, you’ll need to understand the standards and guidelines surrounding per diem rates. This is a key part of business travel expense management. Per diem rates vary by country and for different kinds of trips. We’ve put together this guide to help you get up to speed on everything you need to know about per diem rates in Denmark.
What are per diem rates?
The phrase “per diem” means “by the day” in Latin. Per diem rates are standard rates paid by employers to their employees to cover the cost of a business trip. This daily allowance covers business expenses incurred on the trip, like food, accommodation, transportation, and more. Many governments provide guidelines for per diem rates.
How are per diem rates calculated in Denmark?
In Denmark, employers may offer a tax-free travel allowance, also called a subsistence allowance. For this to apply, the employee must be away for at least a full day (24 hours).
What is covered in the per diem rates?
Rules on the subsistence allowance are available
on the Danish government’s website
. The allowance covers food, accommodation, and petty acquisitions. The day rates for 2024 in Danish krone are:Accommodation
DKK 246 (€32.96)
Food and petty acquisitions for other salary earners
DKK 574 (€76.92)
Food for tourist drivers when driving in Denmark
DKK 75 (€10.05)
Food for tourist drivers when driving outside Denmark
DKK 150 (€20.10)
Travel rules for per diem rates
To be considered “travelling” for the purpose of these rules, employees should have a temporary workplace, a normal place of residence, and be spending the night away from home. They should be travelling a far enough distance that they can’t feasibly reach their temporary workplace by car, bus, or train in a period of time that would make it possible to spend the night at home. If the employee chooses the temporary workplace, this will be assessed on the basis of the fastest means of transport (usually a car). If the employer chooses the temporary workplace and means of transport, it will be assessed on the actual means of transport used. The assessment of what is considered a temporary workplace is individual to each employee.
Food rules for per diem rates
If an employer or their business connections provide free food, the food allowance rate must be reduced by the following percentages:
Free food
75%
Free breakfast
15%
Free lunch
30%
Free dinner
30%
However, this doesn’t apply to tourist drivers, who get the per diem allowances listed in the table above. The per diem amount for food also covers “petty acquisitions.” These include things like a newspaper, a cup of coffee, or local transport. The food allowance is triggered when an employee has been travelling for 24 hours. From then on, additional allowance is payable per hour of travel—for example, 48 hours of travel offers double the daily allowance. Employees are only entitled to these tax-free allowances for the first 12 months that they are at a temporary workplace. If they move to a new temporary workplace, a new 12-month period begins. After 12 months, incidental amounts may still be covered on a case-by-case basis. Employers can’t pay tax-free travel allowances if they’ve made an agreement to reduce an employee’s salary. Some employees also aren’t eligible for tax-free food allowances. These include some fishermen and ship workers, plus salary earners who claim certain benefits.
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Accommodation rules for per diem rates
An accommodation allowance covers overnight stays while travelling. These may include staying in a hotel, caravan, or private accommodation. Accommodation allowance doesn’t apply to people who receive B-income (freelance income), transport goods or people, or work onboard ships, fishing vessels, aircraft, and natural resource facilities. Travellers can’t claim accommodation allowance if they’ve been provided with free accommodation, or if an agreement has been made to reduce the employee’s salary in exchange for accommodation allowance.
Documentation for per diem rates
Employers are responsible for checking that all the conditions for a tax-free travel allowance are met. These include the business purpose of a journey, the number of business travel days, and where the journey began and ended. If the journey does not meet the conditions, the journey is considered taxable income for the employee. If employers want to offer an allowance that exceeds the tax-free rates, they must divide it into a taxable part and a non-taxable part. The food allowance can be taken at a reduced rate if combined with free food and meals. All travel expenses must be documented via signed, stamped, or employer-checked expense reports.
Are per diem rates the same in different Danish cities?
The Danish government has the same per diem rates across the country. Other countries may have their own per diem rates for Danish cities. For example, the US federal government per diem rates for Copenhagen, Denmark are:
Maximum lodging rate
M & IE rate
Maximum per diem rate
$288
$131
$419
And the rates for other Danish cities are:Aalborg:
Maximum lodging rate
M & IE rate
Maximum per diem rate
$194
$110
$304
Lyngby:
Maximum lodging rate
M & IE rate
Maximum per diem rate
$288
$131
$419
Odense:
Maximum lodging rate
M & IE rate
Maximum per diem rate
$202
$116
$318
Other:
Maximum lodging rate
M & IE rate
Maximum per diem rate
$205
$105
$310
Per diem rates for international business travel
The per diem rates for Denmark vary by country. US rates are listed above, while UK rates can be found on
the government website
. The UK per diem rates for Copenhagen are:Over 5 hours
DKK 235 (£27.06)
Over 10 hours
DKK 683 (£78.65)
24 hours
DKK 895.50 (£103.12) plus room rate
Room rate
DKK 1,200 (£138.19)
Breakfast
DKK 164 (£18.89)
Lunch
DKK 213 (£24.53)
Dinner
DKK 426 (£49.06)
Other
DKK 0
Drinks
DKK 44 (£5.07)
Hotel to office
DKK 48.50 (£5.59)
Total residual
DKK 895.50 (£103.12)
Need help with your travel management? Check out our list of the
five best corporate travel companies in Denmark
.Why it’s crucial to know about per diem rates in Denmark
It’s good practice to pay for employees’ expenses when they’re travelling on business, and per diem rates offer a convenient way to do this. It’s important to know about government standards for per diem rates to make sure your company is complying with tax regulations. Per diem rates have many benefits: they can help create more predictable budgets, reduce paperwork, simplify travel for employees, and ensure fairness by standardising reimbursements. Be sure to familiarise yourself with Danish government guidelines for per diem rates when planning business travel in Denmark. If you’re travelling internationally, consult your own country’s per diem rates for business travel in Copenhagen or elsewhere.
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