Double Taxation Treaties in Denmark
Denmark has a developed network of signed double tax treaties with more than 70 countries: Argentina, Armenia, Aruba, Austria, Australia, Bangladesh, Belarus, Belgium, Bermuda, Brazil, Bulgaria, Canada, Cayman Islands, Chile, China, Croatia, Cyprus, Czech Republic, Egypt, Estonia, Finland, France, Faeroe Islands, Georgia, Germany, Great Britain, Greece, Greenland, Holland, Hong Kong, Hungary, India, Indonesia, Ireland, Iceland, Isle of Man, Israel, Italy, Jamaica, Japan, Jordan, Kenya, Korea, Kuwait, Kyrgyzstan, Latvia, Lebanon, Lithuania, Luxembourg, Macedonia, Malaysia, Malta, Morocco, Mexico, Montenegro, Netherlands Antilles, New Zealand, Norway, Pakistan, Philippines, Poland, Portugal, Romania, Russia, Serbia, Switzerland, Singapore, Slovakia, Slovenia, South Africa, Spain, Sri Lanka, Sweden, Taiwan, Tanzania, Thailand, The British Virgin Islands, Trinidad & Tobago, Tunisia, Uganda, Ukraine, The United States, Venezuela, Vietnam and Zambia.
These treaties are very important for the Danish economy as it attracts foreign investors because of the possibility of not being double taxed for the profits and incomes in Denmark and in the country of residence of the shareholders. The taxes can be exempt at source or credited after withholding.
Also the withholding taxes on dividends, royalties and interests are exempt or minimized by these treaties. The usual withholding taxes are 25% for dividends, interests of royalties paid to nonresidents (with an exception for the holding companies which keeps more 10% from one subsidiary’s shares or for the EU/EEA country, totally exempt from paying withholding taxes on dividends).
In order to beneficiate from it, the applicant must provide relevant documents, such a foreign tax certificate proving that the company is already paying those taxes in the country of origin.
Another provision stated in almost each treaty is the fact that any authority can request information regarding the taxes paid in Denmark by a company and any Danish company can ask the same questions to the partner foreign authorities.
Besides these treaties, there are many tax information exchange treaties waiting to be confirmed with Antigua & Barbuda, Gibraltar, Saint Kitts and Nevis, the Grenadines and Saint Vincent.
These provisions are signed in order to avoid the tax frauds, possible if the requesters are not paying taxes in neither of the participant states.