Taxation of free phones

Taxation of devices such as mobile phones, tablets, computers with accessories, and internet connections provided to employees.

There is taxation of free phones, mobile phones, tablets, eSIMs, and internet connections if these can be used for private purposes according to the applicable rules. The rules for taxation can be found on skat.dk

Phone

According to the Tax Agency’s guidelines, a phone is understood as:

• A regular landline phone or a mobile phone, including SIM cards/eSIMs used in private devices.
• An Apple Watch or similar smartwatch with or without eSIM is considered a phone subject to the taxation of free phones. This means that if the employer-paid mobile subscription can be used on a private smartwatch for private purposes, it is equated with a smartphone and is therefore taxable.
• Small handheld computers whose main function is telephony and possibly calendar and time registration functions, such as PDAs, smartphones, and similar devices.
• The phone device itself, setup, subscription, and usage costs of the phone.
• Usual phone services such as wake-up calls, voicemail functions, “caller ID” and other usual services that are part of the subscription. Usual phone services are a flexible concept that changes with the standards and developments in the field.
• A mobile phone that can also be used to access the internet, as the main function of a mobile phone is telephony, and internet access is considered a secondary function of lesser importance.

It is up to the individual manager to decide whether a phone should be provided to an employee.

If an employee is provided with a phone, and this phone is also made available for private use at home, the employee must be taxed on the value of the free phone. It is the private right of use of the phone that is taxed, regardless of how much it is actually used.

The employee is taxed for a free phone at DKK 3,300 in 2025.

The individual employee has no expenses for the subscription and calls on the phone.

Computer including accessories

According to the Danish Tax Agency guidelines it is the main function of the use of accessories, which determines whether or not it is taxed.

iPhones, PDAs and other smartphones are classified as phones, whereas iPads, Folio 100, Galaxy Tab and similar are classified as computers, as their main function is not telephony.

• General accessories are: Common PC accessories such as a screen, software programs, printer, etc. of a normal size and standard. “General accessories” is a flexible term which changes in line with current standards and developments.
• So far monitors with a TV tuner size 32 ", 37" and 42" inches are not considered as general accesso-ries, whereas monitors up to 26" are.
• Accessories made available to an employee without a computer are taxed separately, unless the accessory is primarily provided for the sake of the employee's work and therefore may possibly be below the triviality limit of work-related benefits.

If an employee has a desktop and / or laptop at home, or one which can be taken home, it is not taxed, unless the computer is solely used privately.

If the computer is solely for private use, the individual employee will be informed separately, and it is the responsibility of the employee to report this to the Danish Tax Agency.

Internet connection

According the Danish Tax Agency guidelines an Internet connection is:

•  Access to and use of the Internet, such as ISDN, ADSL connection or other broadband connections.
• A non-recurring expense of setting up the Internet connection.
• Subscription costs for Internet access also include general services that are part of the subscription. Internet subscriptions may include services other than Internet access – e.g. "free" downloads of music or TV channels. If these services are integrated in the subscription and cannot be separated, and if they are regarded as common, they are covered. "General services", which are included in the subscription costs, is a flexible term which changes in line with current standards and developments. Presently e.g. TV packages which are part of a phone and Internet package are not regarded as general services.
• Mobile broadband connections

If an internet connection is made available to an employee privately and the employee has access to DTU’s network and the same programs and documents, as the employee has access to at DTU, no taxation is paid.

If an internet connection is solely for private use and without access to DTU’s network, the employee will be taxed 3,300.- per year.

Taxation

The value of a free telephone and internet connection, regardless of access to DTU's network, is DKK 3,300.- per year. Tax deducted from income at source (A-skat) and LM contributions (AM-bidrag) are retained and the amount is reported to the tax authorities as B income. The DKK 3,300.- is included in the calculation of holiday pay and special holidays.

If several "free phones" are made available to an employee, and there is no work-related reason for this, the employee must report this to the Danish Tax Agency as B income. The same applies, if several "computers with accessories" and "internet access" are made available to an employee for no work-related reason.

Availability of free telephone part of the year

An employee who has only used a free telephone privately for part of the year, or has not been employed throughout the year, will only be taxed for the months of availability of a private telephone.

Spouse discount

Spouses who are both paying tax on a free phone can get a spouse discount corresponding to 25% per spouse. This also applies if only one spouse is employed at DTU.

It is the responsibility of the spouses to check and report the spouse discount to the Danish Tax Agency.

DTU administration

The registration of employee taxation of free telephones is made in the DTU base and reported to the Danish Tax Agency.

Solemn declaration

An employee who does not want to use the phone privately must sign a "solemn declaration", after which no taxation is paid.

By signing a "solemn declaration” the employee gives consent to DTU to obtain information about calls and payment of expenses, to check if the phone is used privately. Information and data submitted will be treated in accordance with the set of rules in the Act on Processing of Personal Data.

The solemn declaration must be uploaded in Fusion – see the guide for instructions

Employees who have previously filled in a "solemn declaration” in connection with multimedia tax, does not have to fill in a new declaration.

Use of mobile phone etc. for private purposes

Mobile phone and other equipment can reasonably be used for private purposes.

The mobile phone cannot be used for parking fee payment and purchase of train and bus tickets given that this access/entry is closed.

If misuse of the telephone is observed DTU may require all associated costs in connection herewith paid back. Misuse is understood as an extensive private use of the telephone abroad, the usage of special services and multi-media in the phone, extensive usage of mobile data abroad, payment of private fees, and payment of private tickets and the like. Furthermore, extensive or repeated misuse may also have employment law consequences.

Via account statements DTU carries out checks on the individual usage/consumption of mobile telephony and mobile data.

Commencement

The guideline is approved by the Executive Board and was discussed by the Cooperation and Joint Consultation Committee (HSU) in March 2017. The guideline becomes effective from the time it is published on DTU Inside.