Denmark seeks public feedback on a bill that would let smaller startups offer unlimited tax-free employee shares under relaxed eligibility rules.
The Danish Ministry of Taxation has initiated a consultation on a bill that would widen access to tax-free employee share schemes under section 7 P of the Danish Tax Assessment Act on 26 August 2025.
The proposal would allow younger and smaller companies to grant tax-free equity-based remuneration without a limit on value, provided the employee earns at least DKK 253,100 annually.
Under the current rules, tax-free shares are capped at 50% of salary for eligible startups, with other thresholds applying based on company size and employee participation. The bill proposes removing this cap entirely for qualifying companies, while keeping the tax advantage that employees are only taxed when selling the shares, at share income rates rather than as salary.
The bill also relaxes eligibility criteria for startups, increasing the employee threshold from 50 to 200, the financial limit from DKK 15 million to DKK 200 million, and extending the maximum company age from five to ten years.
The consultation is open until 25 September 2025.
