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Taxation in Denmark

Corporate and individual tax rules in the Danish tax system.

The Danish tax system entails several points of interest for foreign investors. Some of the attractive elements are:

• Low corporate tax and minor social costs for employees
• Competitive, effective taxation through flexible depreciation and amortisation methods and financing
• Attractive holding company tax regime
• Special expatriate taxation regime for salaried foreign individuals working in Denmark for a shorter period of time
• Full deductibility regarding interest arising from acquisitions

Important notice: Only general rules are described here. For detailed information, visit the website of the Danish Ministry for Taxation, www.skatteministeriet.dk

 

1. Corporate taxation

The Danish corporate tax is 25 per cent placing it below the average European level. There is no additional local tax, franchise or net wealth tax. Corporate tax is paid after deduction of expenses.

2. Holding company taxation

Compared to most other countries, Denmark is a unique holding company location, especially for investors from outside Europe. In practice, a large number of international companies take advantage of the favourable Danish international tax rules. >> Read more

3. Property taxation

Denmark has three kinds of property taxes: land tax, property value tax and building tax.

4. Personal taxation

Regarding personal income taxation, Denmark has one of the highest tax levels in Europe, together with other Scandinavian countries. The high level of income tax reflects several things. Health care, education, elderly and childcare etc. are to a large extent financed through taxes and provided by the public sector. Social security is mainly financed indirectly through taxes, rather than directly by employees and employers.

5. Expatriate taxation

Denmark is one of the few European countries, which applies favourable tax rules for expatriates including foreign researchers. For more information on doing business in Scandinavia contact info@copernicus-consulting.com