In this study, we explored how a targeted land use change in a Danish catchment (River Odense) may provide multi-functional benefits through nitrogen (N)-load reductions to obtain good ecological quality in Odense estuary, protection of N-vulnerable groundwater aquifers, protection of Natura2000 sites and carbon sequestration. An N-load model linked to GIS thematic layers of known protected areas (Natura2000 sites and N-vulnerable groundwater aquifers) was utilised targeting high N-load areas to locate set-aside land. The achieved multi-functional benefits within the catchment and estuary were assessed and cost–benefit assessment was performed by dividing the total welfare costs of the set-aside by the total multi-functional benefits gained from each strategy. The results show that obtaining multi-functional benefits at the lowest cost requires a targeted shift of set-aside from the traditional hot-spot N-load areas to designated protected areas.