Denmark Motor Vehicle Tax Guide (Registreringsafgift, Grøn Ejerafgift)

Registration Tax (Registreringsafgift)

The registreringsafgift is a one-time tax paid when a vehicle is registered in Denmark for the first time. It is calculated based on the vehicle’s value, using a progressive rate structure:

• — 85% on the portion of the vehicle’s value up to approximately 197,000 DKK (2026 threshold)
• — 150% on the portion of the vehicle’s value above ~197,000 DKK
• — Depreciation rules: For used cars, the taxable value is depreciated using standard tables. You may deduct documented repairs and safety equipment from the taxable value.
• — Safety equipment deduction: Certain safety features (e.g., advanced driver assistance systems, extra airbags) may qualify for a deduction from the registration tax base. Documentation from the manufacturer is required.
• — Environmental deduction: Fuel-efficient and low-emission vehicles qualify for reduced registration tax. Electric vehicles (BEVs) have the largest reductions.

Example: For a car valued at 400,000 DKK, the registration tax is calculated as 85% of the first 197,000 DKK (= 167,450 DKK) plus 150% of the remaining 203,000 DKK (= 304,500 DKK), for a total of approximately 471,950 DKK in tax. This means the total cost of the car is approximately 871,950 DKK.

The registration tax makes Danish cars expensive by international standards. However, the tax is included in the purchase price you see at the dealership — it is not an additional cost you pay separately. The dealer handles the registration tax payment to SKAT.

Green Owner Tax (Grøn Ejerafgift)

The grøn ejerafgift (green owner tax) is an annual tax based on the vehicle’s fuel efficiency. It applies to all registered vehicles and is payable by the owner:

• — Based on km/L: Vehicles are classified by kilometres per litre (km/L) or fuel consumption. The less efficient the vehicle, the higher the annual tax.
• — Annual payment: The tax is billed quarterly or semi-annually. You can pay via Betalingsservice direct debit or online banking.
• — Diesel surcharge: Diesel vehicles pay a higher rate than petrol vehicles with equivalent fuel efficiency due to higher emissions per litre.
• — Electric vehicles: BEVs (battery electric vehicles) currently pay no grøn ejerafgift or a greatly reduced amount depending on the year of registration. Hydrogen vehicles also qualify for reduced rates.
• — Plug-in hybrids: PHEVs pay a reduced rate based on their electric range and fuel efficiency.

The green owner tax is separate from the registration tax and is paid every year for as long as the vehicle is registered in Denmark. It is adjusted annually for inflation. You can check your vehicle’s specific rate on SKAT’s website using the number plate (registreringsnummer).

Company Car Taxation (Fri Bil)

If your employer provides a car for personal use, you are taxed on the benefit as fri bil (free car). The taxable value is calculated using a standardised formula:

• — Taxable value: 25% of the car’s list price up to approximately 300,000 DKK, plus 20% of the amount above 300,000 DKK. This annual value is then added to your taxable income.
• — Environmental adjustment: For electric and plug-in hybrid vehicles, the taxable value is reduced by up to 50% depending on the vehicle’s environmental classification. This incentivises employers to offer green company cars.
• — Private use: The fri bil benefit covers all private use, including fuel paid by the employer. If you pay for your own fuel, the taxable value is reduced.
• — Minimum taxable value: Even for very cheap cars, there is a minimum amount below which the taxable value cannot fall (approximately 40,000 DKK annually).
• — Multiple cars: If your employer provides more than one car, each is valued separately. The rules for simultaneous use are complex.

Company car taxation is handled through your forskudsopgørelse. Your employer reports the car benefit via eIndkomst, and it appears on your pre-filled årsopgørelse. The benefit is treated as A-income and is subject to labour market contributions (AM-bidrag) and income tax.

Electric and Hybrid Vehicles (2026 Incentives)

Denmark has aggressively promoted electric vehicle adoption through tax incentives. As of 2026, the incentive structure is as follows:

• — Reduced registration tax: BEVs benefit from a significantly reduced registration tax. The full 85%/150% rates do not apply — instead, a lower rate is used, calculated based on the vehicle’s battery capacity and environmental credentials. The reduction is being phased out gradually.
• — No green owner tax: BEVs registered in 2026 pay no grøn ejerafgift (or a minimal administrative fee). This exemption is scheduled to remain through 2030, after which full taxation will phase in.
• — Historical exemption schedule: Before 2021, BEVs were fully exempt from registration tax. From 2021-2025, a phased introduction of partial registration tax was implemented. By 2026, BEVs pay a reduced but significant registration tax.
• — Plug-in hybrids: PHEVs receive a smaller registration tax reduction and a reduced green owner tax based on electric range. The tax advantage for PHEVs has been reduced in recent years as the government focuses on BEVs.
• — Company car advantage: As noted above, company car taxable value is reduced by up to 50% for BEVs, making electric company cars significantly cheaper from a tax perspective.

The government publishes a phase-out schedule showing how EV incentives will be reduced over time. If you are considering purchasing an EV, factor in the gradually increasing taxation in your decision.

Importing a Vehicle

Importing a vehicle into Denmark involves several tax obligations. Whether you are moving from another EU country or importing from outside the EU, the rules vary:

• — Customs duties: For vehicles from outside the EU, customs duties of approximately 10% of the vehicle’s value apply. Vehicles from within the EU are generally free from customs duties under the single market rules.
• — Registration tax on import: When you register an imported vehicle in Denmark, you must pay the full registreringsafgift based on the vehicle’s value at import. A depreciation allowance applies for the vehicle’s age and condition.
• — EU free movement rules: If you are moving to Denmark from another EU country, you can bring your vehicle without paying Danish registration tax for a limited period (typically 6-12 months) if you can prove you are not a permanent resident. After that period, the vehicle must be registered and taxed in Denmark.
• — Temporary import: Non-residents can drive a foreign-registered vehicle in Denmark for up to 185 days per year without Danish registration tax. This is strictly enforced, and overstaying can result in significant fines and back taxes.
• — VAT implications: When importing from outside the EU, VAT (moms) at 25% is payable on the vehicle’s value plus customs duties. This is in addition to the registration tax. For EU imports, VAT is handled in the country of purchase.

Importing a vehicle can be complex. Many people use a professional import agent or shipping company to handle the paperwork and tax calculations.

Tax Deductibility of Vehicle Expenses

If you use a vehicle for business purposes, you may be able to deduct certain expenses from your taxable income. The rules depend on whether you are an employee or self-employed:

• — Business vehicle deductions: If you are self-employed and use a vehicle exclusively for business, you can deduct the full cost of the vehicle (registration tax, depreciation, fuel, maintenance, insurance) as a business expense. Mixed-use requires apportionment.
• — Mileage allowance (kørselsfradrag): Employees can claim a mileage deduction for business travel in their own vehicle. The rate for 2026 is approximately 3.98 DKK per km for the first 20,000 km and 2.13 DKK per km thereafter. This is claimed in field 31 (kørselsfradrag) of the forskudsopgørelse.
• — Commuting (befordringsfradrag): You can deduct commuting costs between home and work. The rate is approximately 1.98 DKK per km (2026) for distances over 24 km per day (12 km each way). This is claimed in field 29.
• — Documentation with kørebog: For mileage deductions, you must keep a kørebog (driving log) documenting the date, purpose, origin, destination, and kilometres driven for each business trip. Random audits by SKAT are common, and failing to produce a driving log can result in denied deductions and penalties.
• — Electric vehicle charging: If you charge a company EV at home, you may be able to deduct the electricity cost. The documentation requirements for home charging are stricter than for fuel receipts.

For a full guide to mileage and commuting deductions, see our tax deductions guide →.

FAQs

How much is the registration tax on a car in Denmark?

The registration tax is 85% on the first approximately 197,000 DKK of the vehicle’s value and 150% on the amount above that threshold. For example, a car worth 300,000 DKK incurs roughly 321,950 DKK in registration tax. Electric vehicles and fuel-efficient cars qualify for reductions. The tax is paid by the dealer and included in the purchase price — you do not pay it separately when buying a registered car in Denmark.

What is the green owner tax (grøn ejerafgift)?

The grøn ejerafgift is an annual tax based on the vehicle’s fuel efficiency (km/L). The less efficient the car, the higher the tax. Diesel vehicles pay a surcharge. Electric vehicles (BEVs) currently pay no or minimal green owner tax. The tax is billed quarterly or semi-annually and can be paid via Betalingsservice or online banking. You can look up your specific rate on SKAT’s website using your number plate.

How is a company car taxed in Denmark?

If your employer provides a car for personal use, the benefit is taxed as fri bil. The taxable value is 25% of the list price up to ~300,000 DKK plus 20% above that amount. For electric vehicles, the taxable value is reduced by up to 50%. The benefit is added to your A-income and is subject to AM-bidrag and income tax. Your employer reports the benefit via eIndkomst.

Are electric vehicles exempt from Danish car taxes?

Not entirely exempt, but significantly reduced. In 2026, BEVs pay a reduced registration tax (not the full 85%/150% rates), and no green owner tax. The incentives are being phased out gradually — the historical full exemption (pre-2021) is no longer available. For company cars, the taxable value of an EV is reduced by up to 50%. The government has published a phase-out schedule for the remaining incentives.

Can I deduct car expenses on my Danish tax return?

Yes, if you use the vehicle for business. Employees can claim mileage allowance (kørselsfradrag at ~3.98 DKK/km) and commuting deductions (befordringsfradrag at ~1.98 DKK/km over 24 km daily). Self-employed individuals can deduct actual vehicle costs (fuel, maintenance, insurance, depreciation, registration tax) for business use. You must keep a kørebog (driving log) to document business trips. All claims are made on the forskudsopgørelse or årsopgørelse.