Denmark how to cash out without paying taxes?
There is currently no way of avoiding paying crypto taxes in Denmark. However, it is possible to route your crypto to a country with very low or no crypto taxation to cash out. This approach is an easy and legal way to reduce the cost of cashing out your cryptocurrency.
In Denmark, gains from the sale or any other form of disposal of cryptocurrency are subject to personal income tax rather than capital gains tax.
The Danish personal income tax system features four distinct tax categories:
- Initial Tax Bracket In Denmark, there is a uniform initial tax rate of 12.11%, which applies to all income earners. However, this rate is calculated after deducting their allowances and a 8% labor market tax.
- High-Income Tax Bracket Individuals in Denmark earning over 552,500 DKK are subject to an additional tax rate known as the high-income tax bracket, which imposes a 15% extra tax on their earnings. It’s worth noting that this tax is computed after taking labor market contributions into account.
- Municipal and Labor Market Taxes All Danish taxpayers are obligated to pay both labor market taxes and municipal taxes. The labor market tax is fixed at 8%, while municipal taxes vary, with an average rate of around 25%. Even though crypto assets are exempt from the 8% market tax, having a grasp of this tax is essential for crafting effective tax planning strategies.
It’s crucial to understand that in Denmark, there is a regulation that stipulates an individual’s combined initial tax, high-income tax, and municipal taxes must not surpass 52.06% of their income.
Resource: https://coinmarketcap.com/academy/article/9c8f70c9-bace-4794-bc9f-08dc519c040c
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