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flag Denmark Denmark: Business Environment

In this page: Accounting Rules | Tax Rates | Intellectual Property | Legal Framework | Standards | Business Practices

 

Accounting Rules

Tax Year
The fiscal year begins on January 1st and ends on December 31st of the same year.
Accounting Standards
The accounting rules of the Scandinavian countries 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.
Accounting Regulation Bodies
Confederation of Danish Industry
Accounting Reports
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 weighted average cost or with the FIFO method.

For more information, consult the Statutory report on corporate governance by Novozymes.

Publication Requirements
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.
Professional Accountancy Bodies
FFR, Foreningen af Registrerede Revisorer , The Danish Institute of Certified Public Accountants
(Association of Registered Accountants (in English).

FSR, Foreningen af Statsautoriserede Revisorer , Association of Chartered Accountants (in Danish only)
Certification and Auditing
Companies audit are compulsory. Companies must be audited in accordance with the generally accepted auditing practice.
Accounting News
EIN Accounting news on Northern Europe

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Tax Rates

Consumption Taxes

Nature of the Tax
Moms (in Danish) = VAT
Tax Rate
25%
Reduced Tax Rate
None.
Other Consumption Taxes
Various excise taxes apply in Denmark.
Denmark has introduced a fat tax in 2011. The new tax is imposed on food containing more than 2.3% saturated fat, such as in butter, oil and processed food.

Learn more about Service Providers in Denmark on Globaltrade.net, the Directory for International Trade Service Providers.

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Corporate Taxes

Company Tax
23.5%
Tax Rate For Foreign Companies
Resident companies are taxed on worldwide income, with foreign branches and foreign real estate of Danish companies exempted. Non-resident companies are taxed only on Danish-source income. A corporate entity is resident if it is registered in Denmark or if its place of management is in Denmark. The 28% tax rate applies to all forms of companies and branches.
Capital Gains Taxation
Capital gains are normally included in taxable income of companies. Long-term gains on shares are tax-free. Capital gains of individuals are taxed at 27% up to DKK 48,300 and 42% above.
Main Allowable Deductions and Tax Credits
For information on company deductions consult Facts on Taxation in Denmark from the ministry of Foreign Affairs of Denmark.
Other Corporate Taxes
Registration duty, Real property tax, Stamp duty.
Other Domestic Resources
Consult Doing Business Website, to obtain a summary of the taxes and mandatory contributions.
 

Country Comparison For Corporate Taxation

  Denmark OECD United States Germany
Number of Payments of Taxes per Year 10.0 12.0 11.0 9.0
Time Taken For Administrative Formalities (Hours) 130.0 176.0 175.0 207.0
Total Share of Taxes (% of Profit) 27.7 42.7 46.7 46.8

Source: Doing Business - Last Available Data.

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Individual Taxes

Tax Rate

Individual Tax rate Progressive rate from 0% to 59%
Up to DKK 41,000 0%
From DKK 41,001 to 279,800 37.48%
From DKK 279,800 to 335,800 43.48%
DKK 335,801 and over 59%
Allowable Deductions and Tax Credits
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.
Special Expatriate Tax Regime
25% tax rate for the first 3 years in Denmark under specific conditions and for specific occupations.

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Double Taxation Treaties

Countries With Whom a Double Taxation Treaty Have Been Signed
See the list of the double Taxation Avoidance Treaties.
Withholding Taxes
Dividends: 28%, Interest: 25%, Royalties: 25%.
Dividends received from a subsidiary are basically exempt from tax if the parent company owns 10% or more of the share capital

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Sources of Fiscal Information

Tax Authorities
The Danish Ministry of Taxation
Customs Office website
Other Domestic Resources
Taxindenmark

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Learn more about Taxes and Accounting in Denmark on Globaltrade.net, the Directory for International Trade Service Providers.

Intellectual Property

National Organizations
The Committee of Normalization and Metrology is the body working out the laws of standardization and approval in Denmark. Consult also the Copyright Division. The purpose is to harmonize these standards with the European ones. The standard ISO 9000 is a factor of competitiveness, although it is optional.
Regional Organizations
European Patent office
International Membership
Member of the WIPO (World Intellectual Property Organization)
Signatory to the Paris Convention For the Protection of Intellectual Property
Membership to the TRIPS agreement - Trade-Related Aspects of Intellectual Property Rights (TRIPS)
 

National Regulation and International Agreements

 
Type of property and law Validity International Agreements Signed
Patent
 
The Consolidate Patents Act; Publication of the Patents Act, cf. Consolidated Act No. 366 of June 9, 1998 as amended by Act No. 412 of May 31, 2000).
20 years
Patent Cooperation Treaty (PCT)
Trademark
 
Trademark
Madrid agreement
Nice agreement
10 years Trademark Law Treaty
Protocol Relating to the Madrid Agreement Concerning the International Registration of Marks
Design
 
The Danish Designs Act.
5 years renewable twice  
Copyright
 
Consolidated Act No. 763 of June 30, 2006 on Copyright
5 years Berne convention For the Protection of Literary and Artistic Works
Convention for the Protection of Producers of Phonograms Against Unauthorized Duplication of Their Phonograms
Rome ConventionFor the Protection of Performers, Producers of Phonograms and Broadcasting Organizations
WIPO Copyright Treaty
WIPO Performances and Phonograms Treaty

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Legal Framework

Independence of Justice
Guaranteed.
Equal Treatment of Nationals and Foreigners
Denmark is ruled by law. Foreign nationals can expect a fair trial from the country's judicial system. Denmark is one of the least corrupt nations in the world.
The Language of Justice
Danish, but English is the predominant second language.
Recourse to an Interpreter
It is possible to have an interpreter.
Sources of the Law and Legal Similarities
The main source of the law is the constitution of 1849 which went through a major overhaul in 1953. The legal system is based on the civil law system and the judicial review of various legislative acts. Denmark accepts compulsory ICJ jurisdiction, with reservations. Denmark is a member of the European Union (EU), so the country's national law needs to comply with the Community legislation.
Checking National Laws Online
Ministry of justice

Learn more about Lawyers and Legal in Denmark on Globaltrade.net, the Directory for International Trade Service Providers.

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Standards

National Standards Organizations
Danish Standards Association
Integration in the International Standards Network
Denmark is a member of:
- The International Standard Organization (ISO);

- The International Electrotechnichal Commission (IEC);

- The European Committee for Standardization (CEN);

- The Asia-Europe Meeting (ASEM).

Classification of Standards
All new EU standards must be approved as Danish standards and they get the title DS/EN. If a standard initially is international and gets the status of an EU and Danish standards then the title is DS/EN ISO. Like e.g. DS/EN ISO 9001 which is the standard for quality management.
Online Consultation of Standards
Publication of standards is entrusted by the Danish Standards Association. On their website you can see a Danish Standards Foundation.
Certification Organizations
Danish Certification of Standards

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Business Practices

General Information
Danish culture and customs as seen by the Kwintessential website
Danish business culture as seen by the Kwintessential website
Danish business culture as seen by the Executiveplanet website
Opening Hours and Days
Business hours vary throughout Denmark. Opening times range from 8 to 10 a.m. and closing times from 3:30 to 5:30 p.m. Offices operate on a five-day schedule, which means that they are usually closed Saturday and Sunday.
 

Public Holidays

New Year's Day January 1
Maundy Thursday March - April
Good Friday March - April
Easter Monday March - April
Common Prayer Day May
Ascension Day May - June
Whit-Monday May - June
Constitution Day June 5
Christmas Eve & Day December 24 & 25
Boxing Day December 26
 
 

Periods When Companies Usually Close

Christmas One week around Christmas
Easter Some days around Easter
 

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Last Updates: January 2015