Denmark Professional Athletes and Entertainers Tax Guide

Tax Residence for Athletes and Entertainers

Standard residence rules apply: Athletes and entertainers are subject to the same Danish residence rules as everyone else — 183-day test and the home available test (KSL §1). However, the nature of the profession means many athletes/entertainers are frequently mobile, and the 183-day count is often exceeded due to training camps, tours, and competition schedules. A foreign footballer signed to a Danish club for a season (August–May) will likely exceed 183 days and become a Danish tax resident. A touring musician who performs 10 concerts in Denmark over 3 months will not exceed 183 days (unless they rent an apartment in Denmark).

Club vs national team income: For athletes, income from a Danish club (salary, bonuses, signing fees) is Danish-source income. Income from a national team (e.g., appearance fees from the Danish national team) is also Danish-source if the athlete is a Danish resident. Income from foreign national teams or foreign club matches played abroad is foreign-source income — subject to Danish tax if the athlete is a Danish resident, but a foreign tax credit may be available for taxes paid in the match country. The tax treatment of signing bonuses and loyalty bonuses: these are generally treated as salary income (A-income), taxable in the year of receipt, not spread over the contract period.

Image Rights

What are image rights: Image rights refer to the right to use a person's name, likeness, image, voice, autograph, and biographical details for commercial purposes. For athletes and entertainers, image rights can be a significant source of income — sponsorship deals, merchandise, video game licensing, social media endorsements, and appearance fees. In Denmark, image rights are treated as personal rights (personlighedsrettigheder) — they cannot be sold or transferred permanently (only licensed for a period).

Tax treatment of image rights income: SKAT classifies image rights income as personal income (personlig indkomst) — it is taxable at the standard progressive rates (up to ~52.06% including AM-bidrag). If the athlete/entertainer licenses their image rights to a company they control (an image rights company), SKAT applies the substance-over-form doctrine — the income is recharacterised as personal income if the company has no real economic substance (no employees, no office, no business activity beyond receiving the licence fee). The landmark SKAT ruling SKM2024.25.SR confirmed that an image rights company owned by a footballer was a sham arrangement — the income was taxable as personal income of the athlete, not as company income at the 22% corporate rate. To successfully use an image rights company, it must have: (a) at least one employee (the athlete or a manager) performing active work, (b) a physical office in Denmark, (c) its own marketing and sponsorship activities (not just passive licensing), and (d) separate contracts with sponsors (not through the club). In practice, SKAT's position is very restrictive — most athlete image rights companies are challenged on audit. The safe approach is to treat all image rights income as personal income.

VAT on image rights: If you license your image rights through a business (company or sole proprietorship), the licence fee is subject to 25% VAT in Denmark. The VAT must be charged on the invoice to the sponsor or club. If the sponsor is outside Denmark (e.g., an international brand), the place of supply rules determine whether Danish VAT applies — typically, B2B services to a non-Danish business are reverse-charged in the customer's country (no Danish VAT). The VAT treatment is complex and fact-specific — professional advice is recommended.

Short-Term Performances — Withholding Rules

Non-resident performers (Article 17): If a non-resident athlete or entertainer performs in Denmark (a concert, a match, a show), Denmark has taxing rights under most tax treaties (Article 17 of the OECD Model). The Danish withholding tax rules apply: the Danish promoter, club, or organiser must withhold 25% of the gross performance fee and remit it to SKAT. This is a final tax — the non-resident performer does not need to file a Danish tax return if the withholding covers the full Danish tax liability. If the performer's actual Danish tax liability is lower than 25% (due to deductible expenses), they can file a Danish tax return to claim a refund. If higher, they must file and pay the additional tax.

How the 25% withholding works: The withholding applies to the gross amount paid for the performance — including appearance fees, prize money, and bonuses related to the performance. It does not apply to: (a) income from endorsements or sponsorships that are not related to a specific Danish performance, (b) income from the sale of merchandise at the event (treated as business income), or (c) royalties from the broadcast of the performance (treated as royalty income, which may have its own withholding rules). The withholding is administered through SKAT's withholding tax for non-resident performers (kildeskat for udenlandske artister). The promoter must register with SKAT, obtain a tax number for the performer, withhold 25%, and remit it within 8 days of the performance. Failure to withhold results in the promoter being jointly and severally liable for the unpaid tax.

Treaty relief: Some tax treaties reduce the withholding rate below 25% or grant exclusive taxing rights to the performer's country of residence. For example, the Nordic Convention allocates taxing rights based on the 183-day rule (Article 17 of the Nordic Convention) rather than the standard Article 17. If the performer qualifies for treaty relief, they can apply to SKAT for a reduced withholding rate before the performance — the application must be made at least 30 days before the event. For more on treaty rates, see our Tax Treaties Guide →.

Sponsorship and Endorsement Income

Personal sponsorship: Sponsorship income paid directly to the athlete/entertainer (by a brand, equipment manufacturer, or other sponsor) is personal income (personlig indkomst) — taxable at standard progressive rates. The income is reported as B-income (if the athlete is not an employee of the sponsor) or A-income (if the sponsor is also the employer — e.g., a club paying a sponsorship fee to its player). The distinction matters for AM-bidrag (8%) and tax withholding. Sponsorship income received in kind (free equipment, free travel, free clothing) is taxable at the market value of the benefit.

Club sponsorship of athletes: If a Danish club pays a sponsorship fee to one of its players (e.g., a boot deal, a personal appearance fee), SKAT treats this as A-income — the club must withhold A-skat and AM-bidrag and report via eIndkomst. The club cannot deduct the sponsorship as a separate business expense if it is essentially additional salary — it is simply salary and must be reported as such. If the sponsorship is genuinely separate from the employment (e.g., the player licenses their image rights to a third-party sponsor that has no connection to the club), the income may be B-income or corporate income (if routed through a company with substance).

Athlete Pension (Atletpension)

Special pension scheme: Denmark has a specific athlete pension scheme (atletpension) governed by the Atletpensionsloven. The scheme allows professional athletes to set aside a portion of their income tax-free in a special pension account, with the pension payout taxed when withdrawn. The annual contribution limit is approximately 60,000 DKK (2026 level). The scheme is available to athletes who: (a) are licensed by their sports federation, (b) have a contract with a Danish club or national team, and (c) derive at least 75% of their earned income from professional sport. The contribution is made by the athlete (not the club) and is deductible from personal income in the year of contribution. The pension funds are invested and grow tax-free (no PAL tax on the investment returns within the scheme). Upon retirement, the pension is taxed as personal income when paid out.

Interaction with ordinary pension schemes: The athlete pension is in addition to the ordinary ratepension (which has a higher contribution limit of ~63,500 DKK for 2026). Athletes can contribute to both schemes simultaneously, giving a combined annual pension deduction of up to ~123,500 DKK. The athlete pension is particularly favourable because it avoids the PAL tax on investment returns (unlike ordinary ratepension investments, which are subject to PAL tax). For more on ordinary pension rules, see our Pension Tax Guide →.

Social Security for Athletes and Entertainers

Danish resident athletes: Danish-resident athletes are covered by the Danish social security system (AM-bidrag, ATP, health insurance) on their Danish-source income. AM-bidrag at 8% applies to all earned income (salary, prizes, appearance fees, sponsorship). ATP is a fixed amount (~1,300 DKK/year for full-time workers). The athlete pension contributions are not subject to AM-bidrag (they reduce the AM-bidrag base).

Non-resident performers — social security: Short-term performers (non-resident) are generally not subject to Danish social security contributions on their performance income. The 25% withholding tax covers the entire Danish tax liability — no AM-bidrag is withheld. However, if the performer is a Danish resident for social security purposes (e.g., they have an A1 certificate or equivalent), they pay AM-bidrag and are entitled to Danish healthcare. For performers from EU/EEA countries, the A1 certificate from the home country confirms which social security system applies. For more on social security, see our Digital Nomad and Remote Worker Guide →.

Related Guides

• Personal Tax Guide → — income tax, rates, deductions
• B-Income Guide → — self-employment, freelance income
• Tax Treaties Guide → — Article 17, treaty rates, MAP
• Cross-Border Tax Guide → — foreign income, tax credits
• Pension Tax Guide → — ratepension, athlete pension, PAL
• VAT Registration Guide → — VAT on image rights, performance services
• Tax Audit and Appeals Guide → — SKAT audits, binding rulings