In Denmark, the estate is a separate legal entity and a separate tax entity. The estate is taxable if its assets are above approx. €500,000. If so, capital gains tax is levied on the estate for shares, real estate (not the home of the deceased) and so forth. Under the right circumstances (which are fairly common), the spouses can wash off up to €1.5 mn capital gains tax on their estates.
In a marital agreement, the couple can create a separate property of €500,000 that is not tied to a specific asset for the pre-deceased spouse. The rest of the assets remain community property. That €500,000 is not passed on to the surviving spouse, but to the children. Upon the death of the first spouse, the heirs can choose which asset(s) to place in the €500,000 bracket. They may opt for capital gains tax relevant assets, say shares in a holding company. Those shares are then passed on free of capital gains tax since the succession as such is below the €500,000 tax threshold.
The surviving spouse may then opt for a postponement of the succession of the rest of the estate, which is their right when there are only joint children and community property. Upon the death of the surviving spouse, that estate is treated as two estates since it covers the joint marital assets of both spouses. This results in a new, double tax-free threshold of €500,000, one for each spouse. If the surviving spouse, through gifts etc., can tailor their assets to fit these thresholds, the couple will have obtained a €1.5 mn capital gains tax free estate in total.
This model can also be used in combination with the restructuring of companies for an even greater tax advantage.
January 20, 2026
By Troels Rovsing Koch & Mette Sheraz Rovsing- Rovsing Advokater P/S – Copenhagen (Denmark)
