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Gross Salary Agreement

A gross salary agreement is an agreement you can enter into with your employer. It means that you go down in salary by an amount equal to the cost of the education. This means that the employer pays for the training and subsequently deducts the amount from your gross salary and in this way you get a tax saving.
An example - you want a Business Practitioner education. It costs DKK 20,900. If you make the agreement over 12 months, you must go down approx. 1,742 in salary per. month.

Establishment of a gross salary agreement

A gross salary agreement is established by the employer and the employee entering into a new wage agreement or a supplement to an already existing wage agreement. The agreement will state that the employer makes one or more benefits available in exchange for the employee reducing their gross salary.

Requirements for gross salary agreement

According to practice, the following requirements must be met in connection with an agreement on gross salary reduction in order for the tax authorities to recognize the agreement for tax purposes:

  • The agreement must be going forward
  • The agreement must be entered into voluntarily between the parties
  • The gross salary decrease must be distributed over the wage period (agreement period) - typically 12 months
  • The salary reduction must be set in advance at a certain amount, which is not directly dependent on the employee's current consumption of the goods.
  • The employer must in principle be the owner of the goods or be a party to the contract and responsible in relation to the supplier
  • The employer cannot impose increased costs on the employee during the period in which the agreement runs
  • The employee must have the opportunity to withdraw from the agreement.

Below is an example that illustrates the tax savings that come with a gross salary agreement.

The employee "avoids" paying DKK 9,748 for the education rather than DKK 20,900, as the tax finances the remaining part of DKK 11,152.
VAT is not included, as the company can deduct VAT.

Questions contact

Portræt-Til-hjemmeside_Melanie-sort-hvid
Melanie Jørgensen
Tlf. +45 3117 8797
[email protected]

HUMI

We develop humans based on Emotional Intelligence and NLP
HUMI, Lumbyvej 19, PUMPEHUSET, 5000 Odense

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