Denmark

Click on each topic for more information
:

TAXES - ACCOUNTING

 

 

Corporate tax

Tax rate for resident companies

28%

   
Tax rate on long-term capital gains Capital gains are taxed at the rate of 30%.
   
System governing groups of companies and dividends paid by subsidiaries to their parent companies Dividends paid to non-resident companies:
Withholding tax of 28% when the non-resident company owns at least 20% of the share capital for one year.

Dividends paid to resident companies:
Dividends received from a Danish or foreign company are tax-exempt when the parent company owns at least 20% of the share capital for one year.

   
Tax rate on branches Branches are taxed at the rate of 28%.




Income tax

Fiscal year The fiscal year begins on January 1st and ends on December 31st of the same year.
   
Income tax rate Individuals are subject to the state income tax, charged at progressive rates of up to 26.5%, and to country, municipal and church taxes. Country and municipal taxes range from 29% to 35%, and church tax varies from 0.4% to 1.5%.
A maximum tax ceiling of 59% applies.
   
Tax deductions or other allowances There are several types of deductions or reductions applying to taxpayers. For further details concerning the nature of the deductions, contact the local tax authorities.



VAT rates

Standard rates 25%
   
Reduced rates A 0% rate applies to newspapers, the sale and leasing of certain aircrafts and ships, and exports.
Exempt supplies include certain financial services, insurance, education, medical supplies, and the sale and leasing of immovable property.



Other important taxes


Name of tax
Rate
Property tax  
1.6% to 3.4%  


 

Accounting

Introduction
The accounting rules of the Scandinavian countries (Denmark, Finland, Iceland, Norway and Sweden) are very similar thanks to their closely related history and culture.
The relation between the accounting and the tax system is the same as in Germany.


General accounting principles
Intangible assets can be booked in the Balance sheet or in expenses in the profit and loss account (choice of the company).
Physical fixed assets must be estimated at the original or production cost.
Current assets have to appear at the lower cost and value of the market.
Stocks are estimated with the weighed average cost or with the FIFO method.

Obligations and publications
Law refers to the notion of "good accounting method" as regards the methods of companies for the elaboration of financial status.
All the companies of capital have to send a copy of their annual report to the legal authorities of the country. This annual report must contain a profit and loss account, a balance sheet and an annual report.

Certification and auditing
The audit is compulsory.

Professionals and representative organizations
The auditors : they are represented by two professional organisations recognized by the State: the FSR (Foreningen af Statsautoriserede Revisorer) which represents the authorized auditors and the FFR (Foreningen af Registrerede Revisorer) which represents the approved auditors.



Useful links
The Danish Ministry of Taxation
The Finance Ministry
The Customs Office

Last modified in January 2007
Export Entreprises©, All rights reserved