A personal allowance of DKK 46,000 (in 2018) is granted to all individuals over the age of 18. For individuals under the age of 18, the personal allowance is DKK 34,500 (in 2018). The personal allowance leads to a reduction of income tax. Where a spouse cannot utilise the whole personal allowance, the balance is normally transferred to the other spouse. The value of the tax reduction is calculated based on the applicable tax rates.
For individuals who are subject to limited tax liability, the personal allowance is granted only in relation to income such as salaries and pensions, and where the individual is subject to limited tax liability to Denmark during the whole year. If the individual is subject to limited tax liability to Denmark for less than one year, the personal allowance may be chosen based on certain conditions.