Denmark VAT guide
Denmark VAT guide for businesses
Value Added Tax (VAT) or Merværdiafgift (MOMS) in Danish was introduced in Denmark in 1967. The current standard of rate of VAT of 25% was introduced in 1991. There is no reduced VAT rate in place.
The Danish Tax Authority is called Skattestyrelsen or SKAT.
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What is the VAT (MOMS) rate in Denmark?
25%
Denmark’s standard-rated VAT rate is 25% and has been in place since 1991. There is no reduced rate VAT rate in the country, hence only the standard-rated VAT rate, the zero-rated VAT rate (i.e. 0%) and exempt of VAT are in place.
Requirement to register for VAT
If the taxable turnover has reached the threshold of DKK 50,000 over a 12-month period, then the business is required to register for VAT. Additionally, registration should be carried out 8 days prior to the start of taxable trading within the country, where applicable.
Registration processes take around 21 days after the request has been sent. It should be noted that for non-established companies, the Form 40.112 should be filled out online.
Intrastat has to be submitted if the annual turnover exceeds the value of DKK 6,900,000 for Arrivals and DKK 5,200,000 for Dispatches. (2022 threshold amounts are DKK 10,000,000 for Dispatches and 13,000,000 for Arrivals. There are two ways in which a business may be liable for Intrastat:
If a business’s trade exceeds the threshold in 2021. In this case the business becomes liable for Intrastat submission in January 2022.
Or, if a business’s trade exceeds the threshold during 2022. In this case the business becomes liable for Intrastat submission from the next reporting period.)
EC Sales List (ESL) is obligatory if a Danish taxable person carries out supplies or renders reverse-charge services to EU VAT registrations, with a deadline of 25th each month. If a business has limited supplies, then the company may request permission for quarterly submission.
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Invoicing requirements
If you sell goods and/or services subject to VAT, you need to prepare an invoice. The invoice must state:
- Sequential invoice number
- Invoice date
- Name and address of seller and his/her CVR (business reg. no.)/SE no. (VAT no.)
- Name and address of the customer
- Type of goods/services, quantity and price
- Date of delivery (if different from invoice date)
- VAT basis, price per unit exclusive of VAT, possible discounts, bonuses and rebates if they are not included in the unit price
- Current VAT rate
- VAT amount
Simplified invoice requirements in Denmark
If you sell goods and/or services for less than DKK 3,000 to another business subject to VAT, you may issue a simplified invoice stating:
- Name and address of your business
- CVR no. (business reg. no.)
- Sequential number (invoice number)
- Date of issue (invoice date)
- Quantity and type of goods delivered/extent or type of services performed
- Total invoice and VAT amount
Deadlines and filing frequency
If a business had an annual turnover less than DKK 5,000,000, filed and paid on time, then the half-yearly VAT return can be submitted. The submission deadline is the first day of the third month after the end of the reporting period. For example, a VAT return submission for 1 July – 31 December 2021 will have a payment deadline is 1 March 2022.
Monthly returns
If a business has its annual taxable revenue above DKK 50,000,000, then monthly VAT return has to be submitted with a deadline of the 25th of the following month of the end of the reporting period.
E.g. a VAT return submission for 1st December – 31st December 2021 will have a payment deadline is 25th January 2022.
Furthermore, if a deadline falls on a bank holiday, then the following working day is the deadline for both the submission and the payment.
The EC Sales List has its deadline set to the 25th of the following month of the reporting period.
Quarterly returns
If a business has its annual turnover subject to VAT between DKK 5,000,000 and 50,000,000 then a quarterly VAT return has to be submitted. Similar to the half-yearly return, the deadline is the first day of the third month after the end of the reporting period.
E.g a VAT return submission for 1st October – 31st December 2021 will have a payment deadline is 1st March 2022.
Submission
Only electronical submission of the VAT return and other related reports are possible. It should also be noted that, for the e-submission of the returns, a taxpayer must possess a hard token which contains a valid electronic signature of the taxpayer.
Fiscal representative
Fiscal representative is required for non-EU businesses. However, if your business is established in another EU member state, appointing a tax agent is not compulsory.
IOSS
Since the 1st of July 2021 the European Union removed the duty-free limit of €22 parcels to private customers. In Denmark DKK 80 applies, which is lower than the EU standard.
Furthermore, goods imported to the EU from non-EU businesses and with a value below €150 may be subject to the IOSS (Import One Stop Shop) scheme.
Transactions in scope for IOSS:
- Goods are imported from a non-EU country to an EU member state
- The value of the goods does not exceed the value of EUR 150
- The goods are not subject to excise tax
If the supplier has applied for the IOSS scheme, monthly return has to be submitted and payment should be carried out with the corresponding EU member states. If the supplier does not apply for the IOSS scheme, then the VAT must be paid by the buyer.
Intrastat
If supply or purchase of goods are carried out to other EU member states, then Intrastat declaration has to be submitted. Thresholds are:
- Arrivals DKK 6,900,000
- Dispatches DKK 5,200,000
Deadlines are separated into two groups:
Group 1 is for large businesses and the deadline is the next month after the end of the reporting period. Submission varies, as the January, February and October declarations are to be submitted by 12th of the following month of the reporting period. The rest of the deadlines are set between to 14-19th.
Group 2 is for small businesses with the submission deadline of 25th day of the next month of the reporting period (exception is the June period with mid-August submission deadline). If the submission deadline falls on a bank holiday, then the next working day is the submission deadline.
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