International Estate Planning

When a person passes away, estate or inheritance taxes may apply. For larger estates, additional estate tax may also be due. If the deceased was a resident of Denmark, taxes and duties are paid under Danish law before the heirs—whether Danish or foreign—receive their inheritance.

Domestic planning opportunities

Under Danish tax law, inheritance can often be optimised through careful estate planning.

 

Cross-border inheritance

International inheritance situations are far more complex. As a general rule, the deceased’s estate is taxed in the country of residence. For example, the estate of a Danish resident is taxed according to Danish rules before distribution. However, the subsequent taxation of each heir depends on their country of residence and the type of assets inherited.

Types of international estate planning

  • Shares and investments: If an heir lives in a country with low capital gains tax, it may be advantageous to allocate shares at minimal value to that person.
  • Real estate: If an heir is subject to high property taxes, it may be preferable to sell the property at market value and transfer the proceeds as a cash inheritance instead.
  • Complex assets: Inheritances from abroad—such as trusts, brokerages, LLCs, or other foreign structures—can have widely varying tax consequences in Denmark. Depending on how the foreign asset is classified, Danish inheritance tax can range from 0% up to 52%. This is especially relevant for assets originating from jurisdictions with different legal or tax systems, whether from remote islands in the Pacific or from more mainstream locations like the USA or the UK, where trusts and LLCs are common estate-planning tools.
  • Trusts: These can present significant challenges in the Danish tax system, with tax rates ranging from 0% to 52%. The Danish classification of the specific trust is crucial.

We provide guidance on international inheritance matters, helping you navigate cross-border taxation and optimise your estate outcomes.

Do you need advice?

We take your individual circumstances as our starting point and help you move forward.

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