Double Taxation Treaties in Denmark
Double Taxation Treaties in DenmarkUpdated on Friday 03rd March 2023
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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.
Reduced or exempt taxes under the double taxation treaty
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. Our team of Danish lawyers can help you in this matter.
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.
For more details about the provisions of the double tax treaties concluded by Denmark, feel free to contact our Danish law firm.
Our accountants in Denmark can provide you with personalized information on the taxes you will need to pay if a double tax treaty applies in your case. Moreover, you will receive assistance to ensure complete tax filing and payment compliance, assistance with preparing the annual financial statements, bank reconciliation, and more. You can reach out to us for information about our services.