Investors looking for specialized aid when opening a company in Denmark can request the services offered by our agents who specialize in company incorporation. Company Formation Denmark.com provides all the necessary instruments for company registration in this country, such as:
- drafting the Articles of Association and other documents necessary for the incorporation of the Danish company;
- setting up a bank account for the Danish company;
- recommending an accountant and offering a Registered Office in Denmark.
The steps for opening a company in Denmark are briefly outlined in the list below:
- Choose a suitable type of legal entity: this is done by observing the size of the future business, its goals and objectives, along with the available capital for incorporation.
- Choose a unique business name and open a bank account: each company must have a unique business name and a bank account opened with one of the Danish banks.
- Actual company registration: once the company’s constitutive documents are complete, entrepreneurs submit all of them to the Danish Business Authority; each company is assigned a CVR number.
- Tax registration: after it’s registered with the Business Authority, a new company is also registered with the Danish Customs and Tax Administration.
Our agents detail each of these steps further down in this article. Investors who have additional or specific questions can send us an inquiry. Businessmen who intend to open a company in Denmark should know that our team of specialists in company registration in Denmark can handle the entire company formation procedure. In case you need specialized accounting and auditing services in Malta, we can put you in touch with our partners.
Types of companies
Private limited company
Minimum share capital
for LTD Company
Minimum number of
shareholders for Limited Company
|Time frame for the incorporation||
4 working days
|Corporate tax rate||22%|
|Dividend tax rate||
27%, with a 22% reduced final rate in some cases. No witholding tax on dividends applies in case of the participation exemption.
25% standard rate and a 0% reduced rate for some goods and services.
|Number of Double Taxation Treaties||80|
|Do you supply a Registered Address?||Yes|
|Local Director Required||No|
|Annual Meeting Required||Yes|
|Electronic Signature||Yes, in most cases (exceptions: notary, marriage contracts, certain real property rights transfers, etc.)|
|Is Accounting/Annual Return Required?||Yes, auditing can be optional in some cases.|
|Any Tax Exemptions Available?||Dividends received by Danish parent companies are generally tax exempt from the withholdign tax.|
|Any Tax incentives Available?||Full deductions for patents in the year of acquisition and various research and development expenditure refunds.|
Types of business entities in Denmark
Only a single member is required to form a Danish Private Limited Company (Anpartsselskab – ApS) without restrictions on his residence. The minimum share capital necessary in order to incorporate a Limited Liability Company in Denmark is 40.000 DKK which is divided into shares not negotiable, and not transferable. The members of the Danish ApS are held liable to the company’s debts to the extent of their contribution.
For large amounts of capital and a limited liability of the members, it is advisable to open a Danish Public Limited Company or stock corporation (Aktieselskab – A/S). A Joint Stock company incorporated in Denmark requires at least one founder and a minimum share capital of 400.000 DKK. Under certain conditions one can choose to pay only DKK 100,000 up front for an A/S.The capital is divided into shares which can be offered to the general public. Just like in the case of the private limited liability companies, the liability of its members is limited to the extent of their contribution to the capital.
For small investments, the Danish and foreign entrepreneurs are advised to opt for opening the main form of business an individual can establish in Denmark which is the sole proprietorship. In this case, the single member of the business entity is not a separated entity from its business and it is fully liable for the company’s debts.
Investors who intend to open a company in Denmark should know that another type of Danish business where the personality of the members is not distinct from its owners is the Danish General Partnership (Interessentskab – I/S). Unlike the companies, the members of the partnership are fully liable to the company’s obligations to the extent of their own personal assets. The structure, the roles and the rights of the partners are regulated by the partnership agreement.
Another type of partnership is the Danish Limited Partnership (Kommanditselskab – K/S) which is formed by a general partner and a limited liability partner, called silent partner. Only the general partner can decide the entity’s business strategies and all the major decisions. The silent partners are liable for the company’s debts in the limit of their contribution to the capital.
Also, investors might take into consideration the idea of entering the Danish market through a branch or a subsidiary. Our specialists in company formation in Denmark are here to advise upon the benefits and requirements of each of them.
Open a company in Denmark
Before drafting the incorporation documents, the Danish or foreign entrepreneurs willing to open a business in Denmark must verify the uniqueness of their name at the Danish Registrar. The articles of association of an entity established in Denmark are the main documents standing at the base of each business. It states the internal regulations of the Danish company and all the details related to it such as the company’s name, the location of the registered office, the purposes of its establishment, details related to the share capital, the names and addresses of the managing members. These articles of association must be notarized before being used for registration.
A particularity of the company registration in Denmark is that each business must receive a digital signature known as NEM id. After taking this step it is necessary that the minimum share capital is deposit in a bank account which will issue a certificate of deposit.
The registration at the Danish Business Authority is made through an online system. The entrepreneurs must complete an online application and send electronically the articles of association and the bank certificate. Due to the centralized system, the companies are registered in maximum one day at the Danish Business Authority and three days at the tax authorities. Our team can definitely help you open a company in Denmark by registering with the responsible institutions.
Companies that will hire personnel must handle an additional step. These entities must register their employees with a private insurance company, a process that lasts approximately one day.
Danish companies in selected business fields will need to apply for additional special permits and licenses once they are registered and have their business permits. These are sector-specific licenses and are obtained from relevant authorities.
Opening a new company is not the only manner in which investors interested in Danish company formation are able to enter the market. Another option is to purchase a shelf company or a ready-made company which has been incorporated but has had no previous business operations. Interested investors can find out more about this option from our agents.
You can also watch a short video on company formation in Denmark presented by our team:
Company taxation in Denmark
Companies in Denmark need to observe the main sources of tax law: the Corporation Tax Act and the Personal Tax Act, along with their amendments, as well as other sources of tax law and agreements such as the double tax treaties.
The main taxes for companies in the country are the following:
- the corporate income tax (22% for companies in all other industries except for the oil and gas industry; for these companies the tax is 25%);
- the withholding tax on dividends (can be subject to a reduced rate under an applicable double tax treaty);
- social security tax (approximately 10,000-12,000 DKK per employee per year);
- stamp duty as well as other taxes.
Companies in the shipping industry can choose to pay a tonnage tax instead of the applicable corporate income tax.
The tax year is usually the same as the calendar year, however, companies may choose a different 12-month period. Affiliated companies in Denmark are subject to tax consolidation and so are branches.
Taxpayers file the tax returns electronically and this must be accomplished within six months from the end of the accounting year. Late filing is subject to penalties.
The value-added tax is imposed on the sale of goods and services and it applies to most companies. The standard rate is 25% and some types of services are exempt, although providers in these categories cannot deduct VAT on the purchases they make. Examples of exempted services include education, insurance, financial activities, the transport of individuals.
Companies are required to register for VAT purposes with the Danish Customs and Tax Administration (SKAT). A legal entity is required to register if the profits exceed 50,000 DKK. Non-resident companies are required to register at all times.
VAT returns and VAT payments are made once a month for those companies with an annual turnover of over 50 million DKK and only on a quarterly basis of this turnover is between 5 million and 50 million DKK. Companies with a turnover below 5 million DKK must only file and pay the VAT twice a year. One of our specialists in company registration in Denmark can give you more information about these different VAT filing and payment requirements, including those for newly registered businesses.
As far as accounting in Denmark is concerned, the applicable principles are the International Financial Reporting Standards, the Danish GAAP and the International Accounting Standards.
How we can help
Our team specializing in company formation in Denmark can help you open and manage your business. We can assist you in all aspects, starting with choosing and registering the legal entity and further down your business progression, as needed with various other corporate-related matters.
We can help you with the following:
- Choose a legal form: as seen above, there are several types of companies available for incorporation and each can suit different business needs, according to size, budget and number of founders; while the business form can be changed if particularly needed, our team can help you choose the right business form from the very beginning;
- Register the business: we provide complete assistance for drafting the corporate documents, handling the processing of founders’ documents and other issues that are needed prior to the actual submission for registration;
- License: we provide complete solutions for companies that need special licensing to function; operating in certain industries in Denmark is subject to more complex conditions and our team is ready to assist you and answer industry-specific questions;
- Workforce: Denmark is a country that has a pool of talented and highly skilled employees; we can help you when the time comes to hire workers and we can also provide advice and assistance for hiring foreign employees;
- Others: we are here to assist foreign companies that are ready to open their Nordic headquarters in Denmark; we can help you set up in Copenhagen or in another chosen city.
We provide personalized solutions to foreign investors who are looking to open a Danish company. Likewise, we are able to assist companies that are ready to expand to the Danish market. Registering a business in Denmark is a simple process and there are no mandatory requirements for residency in case of company founders or directors. Nevertheless, having a trustworthy partner during the incorporation process can be of importance, as investors will find that they will be able to handle all of the steps knowing that they are in full compliance with the ongoing laws and requirements.
Foreign investments in Denmark
Many foreign investors want to come and open a company in Denmark due to the country’s high standard of living. This statute also keeps the economy in a rather flourishing position. Foreign investments in Denmark are encouraged by the government by offering incentives, such as loans, grants or reduced taxes for foreign investors. If you wish to know how much you have to pay in terms of corporate taxes, dividend tax and VAT in Denmark we invite you to use our instant tax calculator.
Some of the key business sectors in Denmark include but are not limited to the following:
- Transport, trade, and logistics: the country owes its success to its position in Europe; reaching EU consumers is easy from Denmark and many transport and logistics companies have set up their headquarters here;
- Construction: this industry is an evolving one and many international companies are looking for investment opportunities in the Greater Copenhagen area;
- Technology: Denmark encourages innovative and modern solutions and the country is preferred by investors in software development, robotics, mobile technology as well as others; access to talented employees is also facile here;
- Life science: pharmaceutical and biotech companies, clinical testing companies well as health technology companies have all found a suitable location to develop their activities;
- Food: Denmark can be seen as an important food cluster in Europe and many companies benefit from the welcoming and collaborative environment where top food producers work together to provide quality and organic ingredients.
According to Statistics Denmark, the value of direct investments was higher in the final quarter of 2019, compared to the beginning of the same year:
- direct investments in Q1 2019 had a value of 1,778,767 million DKK;
- in the second quarter of the year, FDI amounted to 1,812,417 million DKK;
- this value increased further in the third quarter, to 1,895,647 million DKK;
- in the final quarter of 2019, the direct investments amounted to 1,950,965 million DKK.
According to the same source regarding general enterprise statistics for the year 2017, the majority of companies activate in the trade and transport sector, as Denmark is well established in this business field, particularly sea transport. Other key areas for doing business are the business services sector (advertising, computer services, legal activities, business management, and consulting as well as others), followed by construction and real estate, education, and health. As far as employment per business sector is concerned, the public administration, education, and health sectors employed the largest number of people in 2017, followed by the trade and transport sectors.
Investors looking towards company registration in Denmark will also benefit from the fact that the country is ranked among the top countries in Europe for ease of doing business. These favorable positions occupied by Denmark in international economic and business overviews are based on some facilities in the process of setting up a company in Denmark. The well-trained workforce, the high quality of life or the lack of bureaucracy in Denmark are only a few reasons for company formation in Denmark.