Can You Avoid Mark-to-Market Taxation on Shares?

Mark-to-market taxation ("lagerbeskatning" in Danish) means you're taxed on the increase in value of an investment once a year — regardless of whether you've sold or not. This contrasts with realization-based taxation, where you're only taxed once you actually sell and "realize" a gain. For many business sellers, this question becomes especially relevant once the sale proceeds need to be invested somewhere.

When does mark-to-market taxation apply?

Mark-to-market taxation applies to, among other things, investments in investment companies (e.g. many mutual funds and ETFs), and the rules apply to both Danish and foreign investment companies. Ordinary individual shares in a company, by contrast, are typically taxed on a realization basis — that is, only when you sell.

Can it be avoided entirely?

If you place the money in a product covered by mark-to-market taxation, you can't avoid it — but you can reduce the overall tax burden by choosing where and how the money is placed:

• Share savings account ("aktiesparekonto"): Returns here are also taxed on a mark-to-market basis, but at a lower rate (17% in 2026) and within a deposit cap (DKK 174,200 in 2026). For amounts within the cap, this can be advantageous compared to ordinary share income taxation.
• Pension scheme: Returns in a pension savings plan are taxed at the special, lower PAL tax rate (15.3%) instead of ordinary share income tax.
• Individual shares instead of investment companies: If you choose to invest directly in individual shares rather than through an investment company, you avoid mark-to-market taxation and are instead taxed when you sell.
• Spread realizations over several years: For realization-taxed shares, you can sell gradually instead of all at once, avoiding the entire gain hitting the high 42% rate in the same year.

Why is this relevant after selling a business?

If you've sold your business and are sitting on a large cash proceeds — often parked in a holding company — the question of how to invest the money going forward quickly becomes relevant. Here, the choice between mark-to-market and realization-taxed products has a direct impact on how much you actually end up with after tax.

Thinking about how to invest the proceeds from a business sale afterward? That's a conversation that extends beyond the sale itself — book a call under Advisory & Mediation, or read more about tax when selling a business.