Accountant in Denmark

Updated on Friday 15th March 2024

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Working with an accountant in Denmark is advisable for companies of all sizes, irrespective of the business field in which they activate. Outsourcing the accounting services is convenient for many companies, including for larger ones, even if clients only choose part of the services, and not a complete package.

All Danish companies are expected to follow the laws in force regarding registration, licensing, annual accounting and reporting.

By working with our team of lawyers in Denmark you will ensure legal compliance, and you can combine this with the services offered by an accountant in Copenhagen.

Read below to find out more about the general accounting rules applicable in Denmark and how our team can help you.

Quick Facts
Bookkeeping services	Tracking financial transactions and providing complete and accurate records and accounts
Payroll	The administration of payroll and employment tax obligations provided by our accountant in Denmark
Invoicing	Request, track and manage invoices
Cash management in Denmark	Wire transfers, cash flow to equity, cash flow to the firm
Reporting	Handling the annual reporting obligations in Denmark
Financial analysis	Monthly, quarterly or annual reports, financial research and analysis
Forensic accounting	Evaluate evidence and interpret the findings in the context of an investigation or in court
Tax compliance	Assisting investors in Denmark with the payment of the applicable taxes
VAT compliance and reporting	VAT registration according to the applicable threshold, monthly, quarterly or biannual VAT submissions
Audit offered by our accountants in Denmark	Financial, operational, compliance audits and other related services
Property financial matters	Real estate income reporting, real property tax compliance with the help of our accountant in Denmark, as applicable
Statutory compliance in Denmark	Assistance for compliance with the Danish GAAP or IAS/IFRS
Tax authority assistance	Representation and advice in dealing with matters involving the Danish Customs and Tax Administration
Support for voluntary dissolution	Upon request
Services for foreign companies offered by our accountant in Denmark	Complete accounting services for foreign branches or subsidiaries in Denmark
Consultancy services	Our accountants in Denmark offer consultancy services, including assistance with business plans for loan applications and specialized tax reviews.
Services for small businesses	- bookkeeping, - invoice payment, - VAT submissions, - monthly reporting, - creditor management solutions, - salary management, etc.
Legal framework for accounting in Denmark	The accounting and financial reporting rules outlined in EU Directives and Regulations.
Authorities responsible for financial reporting and auditing	- Danish Business Authority, - Danish Financial Supervisory Authority
Corporate income tax	22%
Withholding tax on dividends	27%, increasing to 47% when it exceeds certain thresholds
VAT rates	- 25% (standard), - 0% (for certain goods and services)
Automatic tax assessment	Danish tax authorities will automatically generate a tax assessment for individuals based on the income they have reported.
Tax year for Danish companies	From January 1st to December 31st, but it can be modified.
Joint taxation (YES/NO)	YES
Audit required (YES/NO)	NO, only for larger companies
Audit exemptions	- must not exceed a balance sheet total of DKK 4 million, - must not exceed an annual turnover of DKK 8 million, - must not exceed having 12 full-time employees.
Foreign tax credit (YES/NO)	YES
Incentives for intellectual property	Denmark offers incentives related to intellectual property rights used in research and development activities; Our team of lawyers in Denmark can provide guidance on how to leverage these incentives effectively.
Other accounting services assisted by our law firm in Denmark	- monthly, quarterly, or annual reports; - budget management; - invoicing; - debt management, etc.

What are the services offered by an accountant in Denmark?

Our team offers a wide range of services and we tailor our solutions based on the company profile, the number of employees, as well as the business goals for financial management. Some of the services offered by our accountant in Copenhagen include the following:

Bookkeeping: complete financial transaction records for companies, including the balance sheets, income statements, invoice filing, assets inventory, receivables, etc.;
Payroll administration: an accountant in Denmark from our team specializes in this particular sector, dealing with all of the steps needed for paying the company’s workers;
Tax and VAT reporting: preparing the annual tax and VAT returns, tax and VAT compliance and registrations as needed;
Others: issuing monthly, quarterly or annual reports, budget management, invoicing, debt management and others.

Our bookkeeping services focus on making sure that our clients comply with the ongoing laws and good practice principles. Our agents are responsible for making reconciliations as required at the level of the documents before they are submitted.

An accountant from our team is the one who will post the documents, make the needed reconciliation of the balance with the financial and credit institution, make reconciliations with the debtors or creditors, make the inventories and prepare and reconcile the VAT accounts.

Our team is also able to offer consultancy services for tax and financial matters. We consult with clients who need to make business plans for loan applications, those who need specialized reviews or consultancy on tax filing for companies.

As required, an accountant from our team can also participate in meetings on location, in Copenhagen. Our temporary assistance solutions can be well suited for companies that need a flexible solution or one that will suit a particular, perhaps urgent financial or tax matter.

Our accountant in Copenhagen can give you more details about these services.

Only Danish companies that are registered for VAT are expected to prepare the VAT accounts and declare the due amounts.

VAT is declared even in those periods when the registered company has had no activity (a zero declaration is submitted in this case). We remind company owners that the VAT registration threshold in Denmark is DKK 50,000. Non-resident companies are required to register in all cases when they make taxable supplies of certain goods and services.

Accounting services for small businesses in Denmark

We offer solutions to companies of all sizes, however, at the same time, we know that professional tax and bookkeeping services can be very important when you are just starting your business.

Denmark is a very attractive country for start-ups and small businesses. A special type of visa is even dedicated to foreign, non-EU nationals who have the resources to incorporate an innovative business.

In a welcoming, albeit competitive climate, having professional accounting services from the very beginning can be an important advantage for your business.

Small business and start-up owners can benefit from working with a team of accountants in Denmark. When accounting and bookkeeping is left within capable hands, such as those of our specialists, entrepreneurs can focus on growing their business and prioritizing what matters more for their specific business goals.

Our solutions for small businesses include bookkeeping and invoice payment, annual and VAT submissions, monthly reporting, creditor management solutions and salary management.

Our team can also provide solutions for streamlining existing internal processes that can lead to financial gains.

Working with our accountants in Denmark can be on an interim or permanent basis, as your company grows and expands.

What are the Danish accounting principles?

Denmark is a member of the European Union and, as such, it is subject to the accounting and financial reporting rules outlined in the EU Directives and Regulations.

The two local authorities in charge of financial reporting and auditing are the Danish Business Authority and the Danish Financial Supervisory Authority.

Danish companies use the International Financial Reporting Standards (IFRS) as their accounting rules.

We remind company owners that the main taxes applicable to companies are the following:

22% corporate income tax;
27% withholding tax on dividends paid to a resident company, with a 5% reclaim percentage, reducing the effective rate to 22% (in some cases);
25% standard value-added tax rate and a 0% reduced VAT rate for certain services.

Who files tax returns in Denmark?

All individuals who derive income from Denmark must submit a tax return. This applies to employed individuals and for those who receive a personal business income and/or for those who receive foreign income. The Danish tax authorities will send an automatic tax assessment, based on the income reported by the individual.

Any changes to the automatic tax assessment must be filed no later than May 1st following the end of the tax year.

For companies, the calendar year is the same as the taxable year. Corporations may select a different 12 month period.

Companies in Denmark have the option to select joint taxation, either mandatory (for legal entities in the same group) or voluntary international taxation.

Our Danish lawyers can help answer any questions, especially if you are foreign employees or investors who are filling in the tax return for the first time.

We also invite you to watch a short video about the main accounting requirements:

When are the accounting filing due dates?

Companies prepare their financial statements each year. For many businesses, the financial year is the same as the calendar one, however, taxpayers may choose to use a different taxable period. The tax returns are filed according to the financial accounts, adjusted for tax and the tax returns are filed no later than 6 months after the end of the accounting year.

You can contact our law firm in Denmark for more information about the tax laws and the requirements set forth by the Tax Department and the Danish tax authorities (SKAT).

While companies can be subject to audit by the Danish tax authorities, only large companies or groups are required to submit annual audits.

A company is not subject to audit if, for two successive years of reporting, it does not exceed two of the following three:

a balance sheet of DKK 4 million;
a net revenue of DKK 8 million;
an average of 12 full-time employees during the reporting period.

If you are in need of audit services in Denmark, our accountant in Denmark can help you.

When should I contact an accountant in Copenhagen for my company?

You can reach out to our team as soon as you have incorporated your company. Alternatively, you may need to change your accounting services provider or, if you company has previously had an internal accounting department, you may wish to switch to outsourcing these services. If you already work with our lawyers in Denmark, it will be convenient to also work with an accountant from our team.

Our experts offer tailored solutions, according to the size of your company as well as your short and long-term business goals. We offer both temporary accounting and auditing solutions, as well as long-term partnerships with companies across all industries.

You can find out more about our accounting services and their prices once you contact us and offer more information on the types of services you will require.

Our team works with hourly rates in most cases. The size of the company and the number of employees have an impact on the total number of hours of accounting services per month.

Different types of accounting services require different hours for their completion. Our team will charge an hourly rate for the annual report and income tax return services and another rate for the hourly bookkeeping services.

Small companies and sole traders can expect a lower number of hours dedicated to accounting services each year while large companies such as an ApS or an A/S will dedicate more hours, which will also be reflected in the budget for the accounting services.

You can find out more about these prices, as well as our packages when you choose several of our services, if you contact our accountants in Denmark.

Tax minimization services in Denmark

Tax minimization represents a set of measures which allows for the legal reduction of taxes and expenses incurred by a company or a foreign citizen relocating to Denmark. You can obtain more information on the tax minimization solutions available for companies from our law firm in Denmark.

Before showing an interest in what is the best way to minimize the taxes paid in Denmark, investors should know that this country is considered a tax-friendly state with a corporate tax rate of 22%.

The available tax minimization measures in Denmark can be regarded from a residency point of view, as only resident companies will be subject to taxation in this country. Permanent establishments such as branch offices of foreign companies will be subject to the corporate tax in Denmark also. This makes double taxation treaties one of the most effective tax optimization tools in Denmark as many levies can be deducted under these agreements.

Our lawyers in Denmark can offer information on the legislation related to taxation under the double tax agreements.

The Danish government has also enabled various tax breaks for companies operating in industries like pharmaceuticals, IT, agriculture, transportation, energy and environment and life sciences which can make viable tax minimization options for business owners in these fields.

Another method through which companies can reduce the taxes paid in Denmark is the foreign tax credit which allows local companies to be reimbursed the levies paid on foreign-sourced income. This method usually applies to subsidiaries of Danish companies in other countries.

Incentives and exemptions as tax optimization solutions in Denmark

One of the most efficient tax minimization tools in Denmark is the distribution of dividends which are exempt from taxation when issued by a local company or received by one. However, there are also exceptions to this rule and they can be explained by our Danish lawyers.

Another effective tax minimization solution is the incentives related to intellectual property rights used in research and development activities

Our team has the knowledge and experience to help you with bookkeeping, tax and VAT reporting, and payroll processes, tax minimization services among many others. Contact our accountants in Denmark for more information about the services we provide.

We also assist our clients with tax advisory and tax compliance services, and legal advisory services either prior or post-incorporation.