General information about the country
Denmark is a Scandinavian country constituting the Kingdom of Denmark as well as the autonomous territories of the Faroe Islands and Greenland.
Denmark is a constitutional monarchy. The head of state is the king. The king represents the legislative power together with the unicameral parliament (Folketinget) which consists of 179 deputies.
Denmark has been a member of the European Union since 1973, but has not adopted the Euro. It continues to use the Danish krone (DKK) as the national currency.
The legal system of Denmark is part of the independent Scandinavian legal group, and combines some features of the Romano-Germanic with the Anglo-American legal systems.
Denmark generally has a standard system of corporate taxation. A company is regarded as resident in Denmark if it is established in Denmark or if the actual management is carried out in Denmark. Resident companies pay corporation tax on all worldwide income.
Meanwhile, such companies as partnerships (Komanditsselskab), provided certain criteria are met, are not treated as separate taxpayers in that the taxes are to be paid by their members, or partners, in the jurisdiction where they are resident and in proportion to the capital equity owned by each partner.
|Company type||Limited Partnership|
|Corporate legislation||Consolidation Act 546 of 20.06.1996.|
|Language of company documents||Danish|
|Corporate ending||K/S, Komanditsselskab|
|Minimum amount||2 EUR|
|Standard amount||EUR 1,000|
|Permitted currencies||DKK, EUR|
|To be paid||Within the first year of operations|
|Maximum number||No restrictions|
|Publicly accessible records||Yes|
|Status||Only physical persons|
|Publicly accessible records||Yes|
|Minimum number||No requirements|
|Local secretary||No requirements|
|Publicly accessible records||NIL|
|Filing an Annual Return||No requirements|
|Fiscal year||January 01 – December 31|
|Publicly accessible Financial Statements||Yes|
|Filing a Tax Return||Yes|
|On trading income||K/S is not considered as separate taxpayer|
|On passive income||K/S is not considered as separate taxpayer|
|Double Tax Treaty network:||Not applicable for K/S|
Additional information on taxation
Denmark does not automatically apply the status of a tax-transparent structure to the partnership. The partnership is only tax-transparent if certain criteria are met such as the majority interest in the partnership must be held by a company from a country that has a double taxation treaty with Denmark. The partnership may otherwise be treated as a corporation for tax purposes with the profit being subject to taxation at the level of the partnership itself.
The financial statements of the partnership for the previous fiscal year being a calendar year shall be prepared and filed with the Danish register of companies by no later than 1st May on an annual basis.
The Komanditsselskab may be exempted from the requirement for certification of its financial statements by an auditor if any two of the following three criteria are met:
- The number of employees of the company does not exceed 10
- The annual turnover of the company does not exceed DKK 10 mln
- The net asset value of the company as at the reporting date does not exceed DKK 4 mln
In practice Komanditsselskabs may prefer to keep an auditor even if they are subject to the above exemption. This is because the appointment and removal of an auditor is a separate procedure. In the following year if the company no longer meets these criteria, an auditor needs to be re-appointed.
A Danish Komanditsselskab is a prestigious instrument that are used most frequently as a founder of subsidiary that participate in large-scale business projects but may also be used for international trading operations.
It is important to note that whilst a Limited Partner is responsible for the liabilities of Komanditsselskab only within the funds contributed by him or it to the Komanditsselskab capital, the General Partner is responsible in full for the liabilities of Komanditsselskab.