5 August 2015

The Danish Tax Authority, SKAT, have recently released an update regarding the treatment of roadside assistance contracts.  They have specified that companies who provide roadside assistance subscriptions must pay tax on the element of non-life insurance premium charged within subscriptions, on a monthly basis. This news release highlighted the importance of companies registering to file tax on non-life insurance if they are offering roadside assistance subscriptions, as well as how to report and pay the premium tax due.
 
FiscalReps contacted SKAT regarding the default position of class 18 ‘Assistance’ insurance contracts, as our understanding prior to this announcement was that ‘Assistance’ insurance contracts should be subject to the 1.1% tax on non-life insurance in Denmark. SKAT has confirmed our position on this point and therefore we understand that class 18 ‘Assistance’ contracts should continue to be subject to the 1.1% tax on non-life insurance by default.
 
Please note that SKAT have highlighted to us that this update was released with the intention of drawing attention to the new requirement that companies offering roadside assistance should register to pay tax on non-life insurance, and that it is not just insurance companies who are obliged to register. The advice we received on querying this update was that “it is taxable for all who give roadside assistance, and these companies must now register.”