Denmark legal and accounting and tax considerations in 2024

Tax planning in Denmark is relatively straightforward compared with most jurisdictions, as it is a low-tax jurisdiction with relatively simple tax laws.

1. The current corporate tax rate in Denmark is 22%;
2. Dividends and capital gains paid from a subsidiary to a foreign parent company are exempt from taxation;
3. Denmark levies no capital duty, share transfer duty or wealth taxes on foreign and domestic companies;
4. The VAT rate in Denmark is 25%. The majority of goods are subject to VAT, and there are no VAT exemptions relevant to business;
5. Municipal income tax is levied on taxable income and varies according to the municipality, between 20.14 % and 26.71%. In Copenhagen, the country’s capital, the municipal tax rate is 24%. Non-resident individuals are taxed at the state and municipal levels;
6. Personal income tax in Denmark ranges from between 37-59% depending on the level of income. This can be further reduced by double taxation treaties;
7. Healy Consultants Compliance Department assists our Clients to efficiently and completely discharge the annual accounting and auditing obligations of their Denmark company through the following: i) documenting and implementing accounting procedures ii) implementing financial accounting software iii) preparation of financial accounting records and iv) preparing forecasts, budgets and sensitivity analysis to better manage financial obligations and ease the process of reporting to the Denmark accounting authorities;
8. It is important our Clients’ are aware of their personal and corporate tax obligations in their country of residence and domicile; and they will fulfill those obligations annually. Let us know if you need Healy Consultants’ help to clarify your annual reporting obligations.

• Healy Consultants Group’s fees for accounting and tax support

  Denmark accounting and tax task	€
  Denmark active company unaudited annual tax and accounting	2,700
  Denmark dormant company unaudited annual tax and accounting	950
  Denmark active company audited annual tax and accounting	5,950
  Denmark annual personal tax return	1,950
  Denmark company residence certificate	950
  Average monthly bookkeeping services	550
  Quarterly VAT reporting services (active entity)	950
  Quarterly VAT reporting services (dormant entity)	450

• Legal and compliance

  Healy Consultants Compliance Department assists our Clients efficiently and completely discharge their Denmark legal and tax obligations.

  1. According to the Companies Act, a Denmark private limited company must have at least one director and one shareholder of any nationality;
  2. Every company must lodge an annual return confirming relevant details of the company for the public register including names and addresses of all directors, address of principal place of business and details of shareholders and their shareholdings. A company is exempt from this obligation if there have been no relevant accounting transactions in the financial year;
  3. Annual audited financial statements must be submitted to the Danish Business Authority, though companies with annual revenue less than US$277,000 are exempt from the audit requirement. Healy Consultants assists our Clients efficiently and effectively complete this annual statutory obligation;
  4. Each time a change occurs in the particulars of the company or to its officers, the change must be lodged with the Denmark companies registry;
  5. Company information such as capital structure and shareholder and director details are made publicly available through the Central Business Register. This means less privacy for shareholders, but increases transparency of doing business in Denmark;
  6. Each Denmark entity must appoint a director. The director is appointed by the memorandum of association or by a separate management contract. Unless otherwise stated in the MOA, the company director shall enjoy full powers of administration, and his acts shall be binding to the Company, provided that it is supported with documentation stating the capacity he enjoys;
  7. All business activities conducted in Denmark must receive government approval. There is an obligation to register for certain business activities with the government, including i) shops ii) hotels iii) restaurants iv) catering and v) agriculture and financial services;
  8. Recruitment of foreign labour requires the employer to justify the hiring of the foreign worker in place of a Denmark national. The foreign employee is expected, but not required, to have professional and educational qualifications relevant to the position;
  9. When employing local or foreign workers, employers must make sure to stay compliant with the Employers’ and Salaried Employees’ Act (1996), the main set of laws governing labour in Denmark. The current labour laws most resemble the English system of labour laws, in terms of employer responsibilities;
  10. A Denmark company can hire EU and Nordic citizens without them acquiring a work permit visa, according to the European Free Movement Law. However, non-EU/Nordic citizens much acquire a work permit visa to work in Denmark;
  11. When incorporating in Denmark, a license is required for all business activities. Healy Consultants can assist our Client in determining what operating licenses are required for their company.