Registering a company in Denmark and opening an account with a Danish bank is one of the most promising solutions in 2022. One of the key advantages of opening an international business in this jurisdiction is the ability to enter the most profitable markets of the European Union, the consumer base of which totals hundreds of millions of people.
The Kingdom of Denmark is an independent progressive state, located in Northern Europe. The country is the main member of the Commonwealth of the Kingdom of Denmark, which also includes Greenland and the Faroe Islands. Among the nearest neighboring countries are: Germany, Sweden and Norway.
Denmark is characterized by a stable, balanced economic system. The most developed areas are: mining, a shipbuilding and engineering, services, light and chemical industries.
The capital of the state is Copenhagen. The monetary unit is Danish krone (DKK).
Key business benefits of Denmark
In 2019, the Kingdom of Denmark took the leading positions in the Doing Business ranking, in particular: 11th in registering property, 9th in taxation, 6th in resolving insolvency, 3rd in ease of doing business and 1st in international trade. In addition, according to research by Numbeo, Denmark is in first place in terms of living in the world.
If you intend to open a company in Denmark, the following advantages of this jurisdiction await you:
- A rapidly growing economy;
- A strong political and social position;
- A convenient geographical location;
- A member of the Hague Convention;
- A low inflation and unemployment;
- The presence of a highly skilled workforce;
- A well-developed high-tech sector;
- One of the most expensive and stable currencies in the world;
- The availability of double taxation avoidance agreements with more than 75 countries in Europe, Asia and Africa;
- A developed banking structure;
- A flexible tax system.
If you want to register a company in Denmark, we recommend you to focus on the following business niches: IT-sphere and software production, a construction, real estate operations, a medicine, a clothing industry, a food industry, a tourism, a gambling.
Types of companies in Denmark
If you intend to register the company in Denmark remotely, then for a start it will be necessary to determine the most suitable form of business activity. In Denmark, you can open the following types of enterprises:
- a Public Limited Company (A/S);
- a Private Limited Company (ApS);
- a Private Limited Company for startups (IVS);
- an Individual Emergency (SP);
- a General Partnership (I/S);
- a Limited Partnership (K/S);
- a branch of a foreign company.
If you want to set up a Danish company remotely, then the best legal forms will be the following: A/S, ApS and IVS. Their main advantages: a relatively quick and easy registration procedure, as well as the ease of management.
Business registration requirements
Depending on the chosen legal form, the Regulator will require certain conditions to be met in order to register a commercial firm in Denmark as quickly as possible, simply and successfully.
Consider them on the example of the most popular forms of economic activity mentioned above (A/S, ApS and IVS).
A/S registration conditions
To open a Danish company by type A/S, you will need:
- a unique name;
- the number of founders is from 3 or more (individuals/companies of any residency status);
- the size of the authorized capital is 500 thousand DKK (about 75 729 USD);
- the enterprise is managed by the Board of Directors, which includes at least one CEO (a resident/non-resident);
- if the CEO does not have EU resident status, then all shareholders of the company must be residents of the European Union;
- shareholders are entitled to hold positions of directors and vice versa;
- a registered office and address, as well as the availability of a competent secretary;
- a mandatory audit.
APS registration conditions
Opening a company in Denmark with the ApS type becomes possible if the following requirements are met:
- a unique name (at the end indicates legal form);
- a number of founders is at least one (an individual/company, a resident/non-resident);
- a number of directors is from 1 or more (the individual/legal entity of any residency);
- a number of shareholders is from 1 or more (a resident of the European Union);
- the size of the authorized capital is 125 thousand DKK (about 18,933 USD), of which 25% is paid within 1 year;
- a local office and address;
- a mandatory financial, tax reporting and audit.
IVS registration conditions
To open an IVS company in Denmark, follow these conditions:
- a unique name of the enterprise;
- the number of founders/directors is from 1 or more (an individual/legal entity, any residency);
- a number of shareholders is at least 1 (EU resident);
- a share capital is at least 1 DKK;
- a local office;
- a submission of accounting and tax reporting;
- an audit.
Also, if shareholders want to receive dividends, they will need to provide a free capital in the amount of 50 thousand DKK, after which the IVS can be converted to ApS.
Stages of a business registration
Registering a Danish company takes place in several stages, the key ones are:
- A choice of the name and a creation of the Charter;
- A preparation of constituent documents;
- Obtaining a digital signature NemID for the access to a bank account;
- Opening a corporate account with a bank in Denmark;
- The equity contribution;
- A registration of employees in a Private Insurance Company;
- Obtaining a special business license/permit in Denmark (if necessary).
Taxes in Denmark
Those, who wish to register a company in Denmark, must certainly familiarize themselves with the tax system of jurisdiction. In particular, pay attention to the following types of taxes:
- The current income tax rate is 22%. Oil and gas companies pay a rate of 25% + pay a “hydrocarbon tax” of 52% (effective rate is 64%);
- A VAT is 25%, with an annual turnover of more than 20 thousand DKK. Companies that provide banking and postal services, produce printed products, and work in the field of medicine, education, and passenger transport are not taxed;
- Dividends are 25%;
- A stamp duty is 0,1-4%.
If you are interested in setting up a company in Denmark, pay attention to the fact, that local (registered) companies do not pay income taxes from around the world, and non-resident companies pay taxes on profits made exclusively within the state.
How to start a business in Denmark?
If you want to open a company in Denmark remotely, YB Case specialists are ready to provide you with professional assistance on the main business advantages of jurisdiction, in obtaining an account for a company with a bank in Denmark, obtaining a gambling Denmark license and more.