As a general rule, it is not a condition that the work must be performed in Denmark.

A special rule applies, however, to employees who are fully liable to taxation and resident in Denmark in accordance with a double taxation agreement. As a general rule, these taxpayers cannot use the special tax scheme if the right of taxation of the salary is transferred to the other country. This may for instance be the case if the employee is staying in the other country for more than 183 days within a 12-month period or if the salary is paid by a foreign employer or the Danish employer's permanent establishment abroad. This rule is laid down in section 48 E(2) of the Withholding Tax Act.

Please note that from 1 January 2017,  it is possible use the special tax scheme if the right of taxation of salary is transferred to another country, but only if the transferred right does not  exceed 30 days within a calendar year.

This is relevant for employees who are employed by a foreign business and are closely affiliated to this business’s permanent establishment in Denmark, and who carry out work in the home country of the business. It is also relevant for employees who are employed by a Danish business and are hired out to carry out work abroad for a foreign business.

Employees who are subject to full tax liability and resident for tax purposes in Denmark, and who are employed by a European Research Infrastructure Consortium (ERIC) are exempt from the rule that the right of taxation cannot be transferred to another country according to a double taxation agreement.

Note that the tax cannot be reduced according to section 33A of the Danish Tax Assessment Act (Ligningsloven) if the earned income is covered by the special tax scheme.