VAT Registration in Denmark

In Denmark, businesses must register for Value Added Tax (VAT) if their taxable turnover exceeds DKK 50,000 within a 12-month period. VAT registration is mandatory for both Danish and foreign companies conducting taxable business in Denmark.

Who Needs to Register for VAT?

  • Danish businesses with taxable sales over DKK 50,000.
  • Foreign businesses supplying goods or services in Denmark.
  • E-commerce businesses selling to Danish consumers if sales exceed the EU threshold.

What is VAT Rates in Denmark?

The standard VAT rate is 25%. Some goods and services are exempt, such as financial services, healthcare, and education.

VAT Reporting Periods

VAT filing frequency depends on annual turnover:

  • Annual turnover < DKK 5 million → Semi-annual filing
  • Annual turnover DKK 5–50 million → Quarterly filing
  • Annual turnover > DKK 50 million → Monthly filing

How to VAT Payment?

VAT payments must be made on time via SKAT’s online banking system. Late payments result in interest charges and penalties.

VAT for Foreign Businesses

Foreign businesses selling goods or services in Denmark may need to register for Danish VAT, unless covered by the reverse charge mechanism, where the buyer accounts for VAT. Non-EU businesses may need to appoint a VAT representative.

Fiscal Representation in Denmark

A fiscal representative in Denmark is required for non-EU businesses that need to register for Danish VAT. The fiscal representative acts as a local agent, ensuring compliance with Danish VAT regulations, including VAT registration, filing, and payments.

Who Needs a Fiscal Representative?

A fiscal representative is mandatory for:

  • Non-EU businesses selling goods or services in Denmark and required to register for VAT.
  • E-commerce businesses outside the EU exceeding the EU distance selling threshold.
  • Foreign companies that must handle Danish VAT but do not have a physical presence in Denmark.

Who Does NOT Need a Fiscal Representative?

  • EU businesses do not need a fiscal representative, as they can register for VAT directly under EU rules.
  • Foreign businesses using the reverse charge mechanism (where the Danish buyer accounts for VAT) may not need local VAT registration.

Penalties for Non-Compliance

Failure to register, file, or pay VAT on time may result in penalties and interest charges imposed by SKAT.

VAT Deregistration in Denmark

Businesses registered for Value Added Tax (VAT) in Denmark may need to deregister if they no longer meet the VAT requirements or stop taxable activities. VAT deregistration must be reported to the Danish Tax Agency (SKAT).

When Should a Business Deregister for VAT in Denmark?

A business must apply for VAT deregistration if:

  • It stops trading or ceases taxable activities in Denmark.
  • Its annual turnover falls below DKK 50,000 (the VAT registration threshold).
  • It changes legal structure, such as merging, closing, or transferring ownership.
  • It no longer makes taxable supplies in Denmark (e.g., switching to VAT-exempt activities).
  • A foreign company stops doing business in Denmark and is no longer required to have a Danish VAT number.