Jesper Grandt Jørgensen, a 78-year-old business owner from Slagelse, Denmark, is facing a DKK 127 million tax bill due to repeated taxation on shareholder loans. Despite attempts to alert politicians and seek a retroactive change to the law, similar to the “tax from hell” case, his efforts appear unlikely to succeed.

The rules on shareholder loans, introduced in 2013, have resulted in business owners being taxed multiple times on the same money when repeatedly borrowing from and repaying their own companies. Jørgensen claims to have been taxed approximately 50 times on the same funds. While an easing of the rules is planned for January 1, 2026, it will not retroactively address the issues faced by those already affected.

Despite some initial sympathy from political parties, including Venstre and the Moderates, there is little indication that a retroactive solution will be implemented. The chairman of the tax committee, Anders Kronborg (S), stated that no amendments received support and that the bill was approved without further changes. He also highlighted the significant funding required, estimated at DKK one billion, to help those impacted by the tax rules.

The situation is similar to the “tax from hell” case, where entrepreneurs faced unfair inventory taxation of shares. In that instance, politicians eventually implemented a retroactive change. Ammar Ali, deputy tax spokesman for the Moderates, argues that the same approach should be taken in the shareholder loan case, as the current rule leads to “absurd” consequences.

Jørgensen’s lawyer, Søren Lehmann Nielsen, criticizes the long delay in addressing the issue and suggests that a retroactive solution is feasible with sufficient political will. Jørgensen has vowed to “fight to the bitter end” in the legal system if politicians fail to provide assistance.

The proposed easing of the tax rules will mean that business owners are only taxed once on the highest amount withdrawn. It also means that taking out a shareholder loan has been legal under company law from 1 January 2025.