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Location allowances

Posted staff receive a tax-free, monthly allowance to cover costs known as location allowance. The location allowance is calculated in consideration of the cost of living on the location as well as the size of the family and the position of the posted staff member, etc.

 

The posted staff member is under an obligation to immediately report any changes to individual circumstances that have an impact on the size of the location allowance.

 

Detailed rules appear from the pdf file attached “Administrativ vejledning for udetillægsordningen” (administrative guidelines for the location allowance scheme).

Administrativ vejledning for og beskrivelse af udetillægsordningen

Annexes 1-3

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Child and youth allowance, SU

Child and youth allowance: With effect from 1 January 2014, child and youth allowance will be paid out via Udbetaling Danmark as is the case in the home service. This applies irrespective of whether staff are posted prior to or after 1 January 2014.

 

An allowance confirmation letter from Udbetaling Danmark will be sent every year primarily to the mother’s e-Boks, but may also be sent to the father’s. You will find all contact made to you by public authorities in Denmark in e-Boks by choosing post from all “public authorities”.

 

SU and other state-financed services: (applicable only for posted staff prior to 1 January 2014). For children or spouses who receive SU, other state-financed services (for example unemployment benefits, cash benefits), or if the child through income of its own (full-time, part-time, student  as well as other jobs) supports itself in whole or in part, parts of your location allowance will cease to exist or be reduced.

 

You are under an obligation to inform HR/Udeteam on these matters by forwarding documentation to this effect.

Tax matters

During the posting abroad, the posted staff member will continue to be subject to tax on salary, i.e. grade salary as well as any pensionable allowances that are paid during the posting.

 

Location allowance and relocation allowance will not be liable to tax, cf. section 7 no. 15 of the Tax Assessment Act

 

You must discuss any private tax issues with your local tax centre.

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