VAT and Tax Deductions for Brands Buying Influencer Marketing in Denmark

Yes — a payment to an influencer is generally a fully deductible advertising expense in Denmark, both on your corporate tax return and on your VAT return, because the content reaches the influencer's followers: an undefined circle of potential customers. That follows from Ligningsloven (the Danish Tax Assessment Act) § 8(1) and the general VAT deduction rule in Momsloven § 37. If the arrangement instead targets specific, named business contacts — a dinner or a gift for one particular partner, say — it risks being classified as representation (entertainment) instead: only 25% tax-deductible, and generally no VAT deduction at all. This is general guidance, not tax advice for your specific situation — always confirm the classification with your accountant.

Two different tax rules, not one

When a business spends money on marketing, there isn't a single deduction rule that covers all of it. Denmark's tax authority, Skattestyrelsen, distinguishes between advertising expenses and representation (entertainment) expenses, and the two carry very different deduction rights — on both income tax and VAT. A payment to an influencer isn't automatically one or the other; what decides it is who the content actually reaches, not the fact that it's labelled "influencer marketing."

Advertising or representation: the test is who you reach

Under Ligningsloven § 8(1), advertising expenses incurred to generate sales of goods or services in the current or a later tax year are fully deductible from taxable income. Skattestyrelsen's own guidance defines advertising as expenses typically directed at an undefined circle of customers or potential customers, serving to maintain the business's general reputation or advance its interests by making it known and favourably regarded.

Representation expenses, by contrast, are directed at specific, named business contacts — for example to close a deal or to build or maintain a relationship with a particular customer. Denmark's Supreme Court underlined exactly this distinction in SKM2013.378.HR: an arrangement limited to a defined circle of people is fundamentally different from ordinary advertising and must be treated as representation, with the reduced deduction rights that brings.

A sponsored post, video or article that an influencer shares with their followers typically reaches an undefined circle — that's advertising in the legal sense. Pay an "influencer" who is really a named business partner for a private arrangement with no public content, on the other hand, and the payment starts to look like representation.

Decision framework: when does an influencer deal count as advertising?

• IF the influencer shares the content publicly with their followers (Instagram, TikTok, YouTube, a blog) and any follower can see it THEN it's an advertising expense — full tax and VAT deduction.
• IF the arrangement is instead a private service for one specific, named business contact with no public content THEN it's assessed as representation — 25% tax deduction, generally no VAT deduction.
• IF you're unsure because the deal mixes public content with a private component (say, an exclusive event where only one influencer is invited, who then posts publicly afterwards) THEN assess the two parts separately — document which part of the payment relates to the public content.

VAT on the invoice itself

Classification as advertising decides whether you can deduct the VAT — but the VAT on the invoice itself depends on where the influencer is VAT-registered:

• Danish influencer with a CVR (VAT) number: charges 25% Danish VAT on the invoice as normal. If the deal is an advertising expense, you deduct the full VAT as input VAT.
• Danish influencer without a CVR number, below the VAT threshold: no VAT on the invoice at all — see affiliate influencer marketing in Denmark for the DKK 50,000 threshold that decides when an influencer must register for VAT themselves.
• Influencer based abroad (EU or non-EU): the invoice is typically issued without VAT, and you self-account for Danish VAT under reverse charge. The full walkthrough of invoicing, VAT and withholding tax for international collaborations is in How to Pay International Influencers — this article doesn't repeat it.

Do gifted products to an influencer count?

If you pay wholly or partly in product rather than cash, the same test applies to the income tax deduction: if the product is part of a deal that results in content shared publicly with an undefined audience, its value is an advertising expense on the same terms as a cash payment. The VAT picture is more nuanced — there is generally no VAT deduction for ordinary gifts (Momsloven § 42(1)(5)), but samples and ordinary low-value promotional items retain full deduction rights. That line is narrow and depends on the product's value and character — get the specific assessment from your accountant before relying on it for a larger product sponsorship. See gifting vs. paid collaborations for the broader comparison between product gifts and paid deals.

Invoice requirements before you deduct the VAT

Whether the influencer is Danish or foreign, the invoice needs to give you grounds to document the deduction: both parties' name and address (your CVR number, the influencer's name/CVR), invoice date and number, a description of the service, the amount and — for a Danish, VAT-registered influencer — the VAT base and VAT amount shown separately. The service description should match what the contract actually agreed — see what to put in an influencer contract for what should already be fixed there, so the invoice doesn't need to be reconstructed afterwards.

Worked example: what a misclassification actually costs (hypothetical)

The figures below are a made-up example to illustrate the point — not a real customer case. Denmark's corporate tax rate is 22%, and the VAT rate is 25%.

Assume you pay a Danish, VAT-registered influencer DKK 15,000 excl. VAT for a sponsored post.

Classified as advertising: The VAT on the invoice (15,000 × 25% = DKK 3,750) is fully deducted as input VAT — it isn't a real cost. The full DKK 15,000 is tax-deductible, saving 15,000 × 22% = DKK 3,300 in corporate tax. The real net cost is 15,000 − 3,300 = DKK 11,700.

Classified as representation: The VAT (DKK 3,750) generally can't be deducted at all and becomes a real cost on top, so the gross amount is 15,000 + 3,750 = DKK 18,750. Only 25% of the DKK 15,000 is tax-deductible, saving just 15,000 × 25% × 22% = DKK 825. The real net cost is 18,750 − 825 = DKK 17,925.

The difference between the two classifications is 17,925 − 11,700 = DKK 6,225 — for exactly the same DKK 15,000 nominal deal. That's the whole reason to get the classification right before the invoice is booked.

Common mistakes

• Assuming "influencer marketing" is automatically advertising — it's the reach of the content, not the category label, that decides.
• Forgetting that the VAT deduction and the income tax deduction follow separate rules — an expense can, in theory, be partly deductible on one side and not the other.
• Treating gifted products as a separate category instead of applying the same advertising/representation test used for a cash payment.
• Assuming reverse-charge VAT on a foreign influencer's invoice means there's nothing to book — you still have to self-account for and deduct the Danish VAT in your own return.
• Asking your accountant only after the invoice is paid — the classification is cheaper to confirm before the money moves.

Make Influence's perspective

This is Make Influence's own operational experience, not a general rule: the large majority of paid influencer collaborations we see — sponsored posts, videos, articles shared publicly with an influencer's followers — fall clearly within the advertising definition, because the entire point of the collaboration is to reach a broad, undefined group of potential customers. The situation that most often creates genuine doubt in practice isn't the ordinary paid campaign, but edge cases like exclusive events or VIP experiences where only a handful of named people attend, before anything is (maybe) posted publicly afterwards. If you're unsure about a specific collaboration, that's the situation worth having assessed separately.

FAQ

Is paying an influencer always an advertising expense?

No. It depends on whether the content reaches an undefined circle of followers (advertising) or targets specific, named business contacts (representation). Most ordinary, publicly shared collaborations are advertising.

Can we deduct the VAT on an influencer's invoice?

Yes, in full, if the deal is an advertising expense and your business otherwise carries out VAT-taxable activity (Momsloven § 37). If the deal is representation instead, there's generally no VAT deduction.

What if the influencer is based abroad?

The invoicing and VAT mechanics (reverse charge) are the same regardless of whether the payment is advertising or representation — see How to Pay International Influencers for the full walkthrough. The advertising-vs-representation classification still decides whether the Danish VAT you self-account for can be deducted again.

Do free products given to an influencer count as a deductible expense?

For income tax, yes, on the same terms as a cash payment, if the product is part of a deal for publicly shared content. For VAT, there's generally no deduction for ordinary gifts — only for samples and low-value promotional items. Get the specific assessment from your accountant.

How is this different from the article on affiliate influencer marketing in Denmark?

Affiliate influencer marketing in Denmark covers the influencer's own tax and VAT obligations on the income they receive. This article covers the other side: your business's right to deduct the expense you incur.

Is the influencer we're paying an employee, a fee recipient or self-employed — and does that change our deduction?

No, not for this article's test: the advertising-vs-representation deduction question is about who the content reaches, and applies the same way regardless of the influencer's own tax status. But the influencer's own classification decides how they report and are taxed on what you pay them — see employee or self-employed? How Denmark classifies an influencer's income for that side of it.