Renting out a room: the lease and rules you need to know

Are you thinking of renting out a room in your home? Renting out a room is a popular way to earn a little extra, whether you own your home or are a tenant yourself. But there are rules you need to know, and a written lease is essential to protect both you and your tenant.

This guide reviews what you need to know about renting out a room in Denmark: the legislation, the tax aspects, the requirements for the lease, and the most common mistakes.

Who can rent out a room?

Homeowners

If you own your home, a house, an owner-occupied flat or a cooperative home, you as a rule have the right to rent out one or more rooms. For cooperative homes, however, you should check the association's articles, as many cooperative housing associations have rules about letting.

Tenants (subletting)

If you are a tenant yourself, you can as a rule sublet at most half of the home's residential rooms, as long as the total number of residents does not exceed the number of rooms. You must inform your landlord in writing, and the landlord can only refuse the sublet if there is a reasonable ground.

When subletting, special rules apply to the rent: you may not charge more than corresponds to your share of the total rent.

The Rent Act and rules for renting out a room

Renting out a room is covered by the Rent Act, exactly like renting out a whole home. This means that most of the Rent Act's protective rules also apply when you rent out a room.

The most important rules

• Deposit: you can require a maximum of 3 months' rent as a deposit
• Prepaid rent: likewise a maximum of 3 months' rent
• Notice period: when you rent out a single room that is part of your own home, your notice as a landlord is 1 month (section 175, cf. section 170(1)). The tenant likewise has 1 month's notice
• Rent setting: the rent must be reasonable and proportionate to the room's size, condition and location
• Maintenance: as the landlord, you are responsible for the external maintenance, unless otherwise agreed

The rule on single rooms in your own home

When you rent out a single room that is part of your own home, the tenancy is among the freely terminable tenancies (section 170(1) of the Rent Act). As the landlord, you can give notice with 1 month's notice (section 175). This gives you more flexibility than renting out a separate home, where the notice period is as a rule longer and you need a lawful ground.

Note, however, that the rule assumes that:

• You live in the home yourself
• It is a single room that is rented out
• The room is not an independent tenancy with its own kitchen

What should a lease for a room contain?

A written lease is not required by law, but it is strongly recommended. Without a contract, it can be difficult to prove what was agreed if a dispute arises.

A lease for a room should as a minimum contain:

1. The parties' names and addresses (landlord and tenant)
2. Address and description: which rooms does the tenant have access to (own room, shared kitchen, bathroom and so on)
3. The rent: amount, payment interval and method of payment
4. Deposit and prepaid rent: amounts and conditions for repayment
5. The start of the tenancy and any end date for a fixed term
6. The notice period for both parties
7. Utility costs: are electricity, water, heating and internet included?
8. House rules: rules for shared areas, smoking, pets, guests and so on
9. Maintenance: who is responsible for what
10. Signatures from both parties with a date

Tax on renting out a room

Rental income from renting out a room in your own home is taxable, but a large part is often tax-free, because you can use a tax-free allowance (bundfradrag). You can choose between an allowance method and an accounts method.

The allowance method

With the allowance method, the rental income is tax-free up to the allowance, and only the excess is taxed. There are two forms of allowance:

1. The property-value or rent method (section 15 P of the Assessment Act)

• If you own the home, the allowance is 1⅓ % of the property value, but always at least DKK 24,000.
• If you are a tenant or a cooperative member, the allowance is ⅔ of your own annual rent or housing charge.

The amount exceeding the allowance is fully taxed as capital income.

2. The fixed allowance for the sharing economy (section 15 Q of the Assessment Act)

• DKK 35,100 (2026) if you rent out via a digital platform that reports your income to the Danish tax authority
• DKK 13,800 (2026) if you rent out outside a reporting platform

Here only 60 % of the part of the rental income that exceeds the allowance is taxed. The rates are adjusted annually, and the allowance can never exceed the rental income.

Example: if you rent out a room for DKK 4,000 a month, you earn DKK 48,000 a year. Using the fixed allowance without platform reporting (DKK 13,800), you pay tax on 60 % of (48,000 − 13,800) = DKK 20,520. Using a reporting platform (DKK 35,100), the taxable amount falls significantly.

The accounts method

Alternatively, you can keep accounts and deduct the actual costs. This can be more worthwhile if you have large costs for, for example, maintenance. The method requires documentation for all costs. Be aware that you cannot readily switch back to the allowance method once you have chosen the accounts method.

Reporting to the tax authority

Rental income must be stated to the tax authority on the annual statement. If you rent out via a reporting platform, the platform often reports the information, but it is your responsibility to ensure that the reporting is correct, regardless of the method of payment.

Subletting and renting out: what is the difference?

It is important to understand the difference, as the rules differ. With renting out, it is the homeowner who lets on market terms with a requirement of reasonableness, while with subletting it is the tenant who re-lets, and where the rent may not exceed the tenant's own share of the rent. If you sublet a room as a tenant, you must inform your landlord, and you remain liable to the landlord for the whole tenancy. If your subtenant causes damage, it is you who is liable.

The most common mistakes when renting out a room

1. No written lease. The most widespread mistake. Without a contract, you are in a weak position if there is disagreement about rent, termination or maintenance.

2. Too high a deposit. The deposit may amount to at most 3 months' rent. If you require more, the tenant can demand the excess back and bring the matter before the rent tribunal.

3. No documentation of the room's condition. Take photos and make a move-in report. Without documentation, it can be difficult to claim payment for damage on move-out.

4. Unreasonable rent. The rent must be in a reasonable proportion to what is rented. If it is too high, the tenant can complain to the rent tribunal, which can reduce the rent, possibly with retroactive effect.

5. No agreement on shared areas. Describe clearly which rooms the tenant has access to, and what rules apply to the kitchen, bathroom and other shared areas.

6. Forgetting to inform the tax authority. Rental income is taxable. If you fail to state it, you risk back payment with interest.

7. Subletting without informing the landlord. If you are a tenant yourself and sublet without informing your landlord, you risk the landlord cancelling your own tenancy.

Setting the rent: what can you charge?

The level of rent depends on the room's size, the home's location, the condition and equipment, and whether utility costs are included. As a rough guide, the rent for a room is typically between:

• Copenhagen and Aarhus: around DKK 3,500 to 6,500 a month
• Odense, Aalborg and Roskilde: around DKK 2,500 to 4,500 a month
• Other towns: around DKK 2,000 to 3,500 a month

The prices often include utility costs, and a furnished room can justify a surcharge. These figures are only an indicative market level. Regardless of the market, the rent may not be unreasonable in relation to what is rented, and the rent tribunal can reduce it if a tenant complains.

Fixed-term renting of a room

You can rent out a room on a fixed-term basis, for example for 6 or 12 months. But the fixed term must be sufficiently justified by your circumstances, for example that you expect to need the room yourself, are planning a renovation, or that a relative is to move in. Without a genuine justification, the tenant can challenge the fixed term, and the tenancy can be regarded as open-ended.

Practical tips for renting out a room

1. Screen potential tenants: hold a meeting and ask for references
2. Make a detailed contract
3. Document everything: photos, move-in report and correspondence
4. Be clear about the house rules from day one
5. Keep track of the rental income, ideally in a separate account
6. State the income to the tax authority

Frequently asked questions

Do I need a lease when I rent out a room?

It is not a legal requirement, but it is strongly recommended. Without a written contract, it is hard to prove what was agreed, and the Rent Act still applies, whether or not there is a contract.

How much deposit can I require?

You can require up to 3 months' rent as a deposit. The deposit must be repaid on move-out, less any justified claims for damage or a lack of cleaning.

Can my tenant complain about the rent?

Yes. The tenant can bring the level of rent before the rent tribunal, which can reduce the rent if it is assessed to be unreasonable.

Can I give my tenant notice without a reason?

When you rent out a single room in your own home, the tenancy is freely terminable (section 170(1) of the Rent Act), and you can give notice with 1 month's notice (section 175). The rule only applies if you live in the home yourself. The termination must still be in writing and inform the tenant of the right to object.

What happens if my tenant does not pay the rent?

If the tenant does not pay on time, you can send a demand. If the tenant still does not pay within the demand deadline of 14 days, you can cancel the tenancy. Always use written communication.

Do I have to pay tax on rental income?

Yes, rental income is taxable, but you can use a tax-free allowance if you rent out a room in your own home. See the tax section above for the applicable allowances.

Can I rent out a room via Airbnb?

Yes, but special rules apply to short-term rental. As a rule, you can short-term rent your year-round home for up to 70 days a year, and the municipality can raise the limit to 100 days. The income is taxable and must be stated.

What is the difference between renting out and subletting a room?

Renting out happens when you, as the owner of the home, let it. Subletting happens when you, as a tenant, re-let. When subletting, you must inform your landlord, and you may not charge more rent than your own share.

Conclusion

Renting out a room can be a sensible way to earn extra income, but it requires that you know the rules and have the legal side in place. A well-crafted lease protects both you and your tenant and prevents conflicts. If you are in doubt about the rules, especially about tax and fixed terms, you should seek advice.

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The content of this article is for guidance only and does not constitute legal advice. Consult a lawyer for advice on your specific situation.