Contents

This section describes when banks, credit institutions and capital pension funds offering plans under Section 1(1) of PAL must submit the statement of the basis of taxation and pay PAL tax.

 

The section covers

• Deadline
• Payment
• Withdrawal of PAL tax from the account
• Missing information on the value of unlisted shares in limited companies and unlisted shares in private limited companies as well as shares in limited partnerships
• Corrections to the statement under Section 22 of PAL
• Notification to the person liable to taxation

 

Deadline

►Pension providers etc. must submit by 15 January after the end of the year of taxation at the latest:◄

• ►the statement of the basis of taxation
• the taxable part thereof
• the tax for the year of taxation 
◄

See Section 22(1), Item 1 of PAL.

 

A statement must be prepared for each of the different savings plans.

 

However, the statement may be made collectively for pension savings accounts under

• Sections 12 or 13 of PBL,
• accounts under Section 42 of PBL,
• instalment savings accounts under Sections 11 A, 15 A and 15 B, cf. Section 11 A, of the Danish Pension Tax Act, and
• accounts under the Special Pension Savings Scheme (Den Særlige Pensionsopsparing (SP)) (SP accounts), cf. the Danish Labour Market Supplementary Pension Fund (ATP) Act (Lov om Arbejdsmarkedets Tillægspension)

 

See also

If the deadline falls on a Saturday, Sunday or public holiday, the deadline is extended. See section D.1.7, Special information on the deadline for submitting statement and paying PAL tax.

 

Payment

PAL tax is paid at the time of submission of the statement.

 

See Section 22(1), last item of PAL.

 

The basis of taxation, the taxable amount thereof and the PAL tax must be declared in Danish kroner (DKK), and the tax must also be paid in DKK. Foreign banks must undertake to translate the foreign currency into DKK in respect of plans taken out by pension holders with the banks. The translation must take place at the average current rate of exchange at the end of the year of taxation, i.e. 31 December. See the comments on Section 22 in L 10 of 28 November 2007.

 

►The total tax amount and the total interest amount must be rounded off to the nearest whole Danish krone (DKK). The tax amount collected from the pension plan holder must not be rounded off. ◄

 

Payment must be made into account no. 3100 781 1020.

 

The statement must be sent to Skattecenter Maribo, Brovejen 15A, 4930 Maribo, Denmark, on a form prepared by SKAT. See Section 1 of Order no. 1540 of 13 December 2007 on the rules in the Danish Pension Investment Return Tax Act on foreign banks and pension providers and on compensation disbursements.

 

Withdrawal of PAL tax from the account (Section 22(2) of PAL)

The bank withdraws the PAL tax from the account of the person liable to taxation one week before the final due date for payment, i.e. on 8 January after the end of the year of taxation.

 

In case of a security with an attached cash account, the bank must withdraw the PAL tax irrespective of whether there are sufficient funds in the cash account to cover the amount.

 

If the account holder does not cover the overdraft within 15 days of the bank having notified the account holder of the overdraft on the account, the account holder must pay interest on the amount. The interest corresponds to the lending rate agreed between the account holder and the bank.

 

The account holder should not deduct such interest expense when determining the income liable to PAL taxation.

 

PAL does not set out any provisions for when a possible overdraft must be covered. Neither does it authorise the bank to carry out a forced sale of securities to cover the deficit. It is up to the individual bank and pension holder to solve this conflict amongst themselves.

 

The bank declares the PAL tax collectively for the administered pension accounts.

 

Specification of the calculation of PAL tax

The pension holder is entitled to a specification of the calculation of the PAL tax from the bank. This means that the bank must provide the pension holder with such a specification if requested by the pension holder.

 

Missing information on the value of unlisted shares in limited companies and unlisted shares in private limited companies as well as shares in limited partnerships (Section 30 of PAL)

 

In the event that an account holder liable to taxation has not submitted information on

• the value of the unlisted shares under Section 15(7) of PAL,
• the value of shares in limited partnerships under Section 16(3) of PAL

the bank must inform SKAT in connection with the submission of the final statement under Section 22 of PAL that the values mentioned have not been received.

 

►SKAT will contact the account holder and inform him or her that the information on the values is missing. ◄ SKAT grants the pension holder a deadline of one month within which to submit the values to the bank and informs the bank about this.

 

See section D.5, Missing information on the value of unlisted shares in limited companies and unlisted shares in private limited companies as well as shares in limited partnerships.

 

Corrections to the statement under Section 22 of PAL

Corrections to a bank's statement under Section 22 of PAL are submitted once every quarter, by 1 March, 1 June, 1 September and 1 December, respectively, at the latest. The bank submits the corrections on a form prepared by SKAT. See Section 9 of Order no. 1540 of 13 December 2007 on the rules in the Danish Pension Investment Return Tax Act on foreign banks and pension providers and on compensation disbursements.

 

Note

After the final due date for payment, which is 15 January, the PAL tax payable carries interest pursuant to Section 28 of PAL, see section D.3, Default interest.

 

Notification to the person liable to taxation

The bank or pension provider notifies the pension holder of the payment of the PAL tax. See Section 22(2), Item 5 of PAL.

 

Such notification must be made in writing. See Section 20 of Order no. 1540 of 13 December 2007 on the rules in the Danish Pension Investment Return Tax Act on foreign banks and pension providers and on compensation disbursements.

 

The bank must notify the person liable to taxation of the PAL tax amounts no later than 8 weeks after the payment of the PAL tax. See Section 22(2), Item 5 of PAL and Section 20 of Order no. 1540 of 13 December 2007 on the rules in the Danish Pension Investment Return Tax Act on foreign banks and pension providers and on compensation disbursements.

 

The deadline runs from the actual payment to SKAT, and the notification must be received by the pension holder by the deadline at the latest.

 

If the account is overdrawn, the pension provider etc. must notify the pension holder at the same time of the amount by which the account is overdrawn.