Your pension pot, at retirement

Project your labour market pension from your contributions, after the 8% AM-bidrag and the 15.3% tax on returns.

  • Danish pension rules
  • Shown in today's money
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Your details

years
years

Danish state pension age depends on your birth year. Check yours on borger.dk.

DKK
DKK
%
%

Common Danish schemes total 12% to 15%.

%

Before tax and costs. 4% to 6% is a common long-term assumption.

%

Pension pot at retirement, in today's money

2,494,136 DKK

4,794,307In future kroner
15,318Per month for 20 years, today's money, before tax
33 yearsTo retirement
Amount
Starting savings150,000
Contributions after 8% AM-bidrag1,967,328
Growth after 15.3% PAL tax2,676,979
Pot at retirement4,794,307

How it's calculated

  1. Monthly contributions. Your share and your employer's share are a percentage of your gross salary.
  2. 8% AM-bidrag on contributions. Labour market pension contributions have AM-bidrag deducted when they are paid in.
  3. Growth after PAL tax. Returns inside the pension are taxed at 15.3% each year, so the projection grows at your return minus that tax.
  4. Today's money. The headline figure is adjusted for inflation, so you can compare it with prices now. Payouts are taxed as income when you retire.

Figures used

FigureValueSource
PAL tax on returns15.3%Skattestyrelsen
AM-bidrag on contributions8%Skattestyrelsen
State pension ageDepends on birth yearborger.dk

Questions

Is the state pension (folkepension) included?

No. This projects your labour market pension only. Folkepension depends on your residence years in Denmark and is paid on top.

What return should I assume?

Pension funds usually plan with 4% to 6% a year before costs over long periods. Use a lower number to be cautious.

Why is the pot shown in today's money?

A krone in 30 years buys less than a krone today. Adjusting for inflation makes the result easier to judge.

Is the payout taxed?

Yes. Most labour market pension payouts are taxed as personal income when you receive them.

Related

Danish pensions explainedFolkepension, ATP and workplace schemes.Read the guide →Net salary calculatorInclude your pension share in take-home.Open calculator →Investing in DenmarkSaving beyond your pension.Read the guide →

Last checked October 2026. A projection, not a guarantee. Returns vary, and fees, salary changes and tax at payout are not included.

Tax & Money

The pension system, three private layers plus the state

Updated July 2026Reviewed July 2026
The one-line versionOn top of the state pension sit three private types: ratepension and livrente (tax break now, taxed later) and aldersopsparing (no break now, tax-free later). Returns are taxed at 15.30% along the way.

The structure

Danish retirement saving stacks in layers: the state pension (folkepension) everyone qualifies for, ATP (a small mandatory supplement), and up to three private schemes - usually including your workplace pension. The three private types differ mainly in when the tax break lands.

The three private types

TypeTax model2026 contribution cap
RatepensionDeduction now; payouts taxed as income; paid in instalments (10-30 yrs)DKK 68,700/yr
Livrente (lifelong)Deduction now; taxed later; pays for lifeDKK 63,200/yr (private)
AldersopsparingNo deduction now; tax-free withdrawal laterDKK 9,900/yr (DKK 64,200 within 7 yrs of pension age)

Tax on the way and at the end

Returns inside any pension are taxed annually at PAL-skat of 15.30% (2026), deducted automatically by the provider - lower than the 27-42% on ordinary investments. Ratepension and livrente give a deduction on the way in and are taxed as income on the way out; aldersopsparing is the reverse - no deduction now, but withdrawals are tax-free and do not count against your folkepension.

Pension is a top-tax leverBecause ratepension and livrente contributions reduce your personal income, topping them up can pull you under the middle- or top-tax threshold. For higher earners, it is often the most efficient tax move available - and it builds your retirement at the same time.
Expats: watch the exitIf you leave Denmark, what happens to your pension depends on the scheme type and any double-taxation treaty - some can be transferred or drawn, others not easily. And there is generally no QROPS route for UK pensions. Get cross-border advice before you move money.

Common questions

What is PAL-skat?
A 15.30% annual tax on pension investment returns (2026), deducted automatically by your provider - you do not need to act.
Ratepension or aldersopsparing?
Ratepension gives a deduction now (good if you are a higher earner today); aldersopsparing gives tax-free withdrawals later. Many use both.
Does exceeding the aldersopsparing cap cost me?
Yes - a 20% penalty on the excess, though transferring it to a ratepension reduces the penalty to 4% and earns the deduction.

Verified July 2026 against official sources: skat.dk (Skattestyrelsen), borger.dk and pension-provider documentation. Figures are 2026 levels and reset each January. General information, not financial or tax advice - see our editorial policy.

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