Double Tax Treaties in Denmark

What is a double tax treaty?

If a non resident foreign investor has invested capital in a company from Denmark, usually the income of that business must be taxed in Denmark and in the country of residence of the shareholder.

In order to avoid this situation, Denmark has signed many double tax treaties over the years. These treaties stipulate the way the capital and the income are taxed and the rates of the withholding taxes on dividends, interest and royalties.

Also, the treaties contain information regarding the exchange of information that has to be made between the signatory states. Every year, lists with the legal entities willing to beneficiate from tax exemptions are trade between the countries.

Along with the double tax treaties, protocols of exchange of information are signed if these requirements are not stipulated by the double tax treaties

Countries that signed double tax treaties with Denmark

Denmark has one of the most developed network of signed treaties with more than 70 countries: Argentina, Armenia, Aruba, Austria, Australia, Bangladesh, Belarus, Belgium, Bermuda, Brazil, Bulgaria, Canada, Cayman Islands, Chile, China, Croatia, Cyprus, Czech Republic, Egypt, Estonia, Finland, France, Faeroe Islands, Georgia, Germany, Great Britain, Greece, Greenland, Holland, Hong Kong, Hungary, India, Indonesia, Ireland, Iceland, Isle of Man, Israel, Italy, Jamaica, Japan, Jordan, Kenya, Korea, Kuwait, Kyrgyzstan, Latvia, Lebanon, Lithuania, Luxembourg, Macedonia, Malaysia, Malta, Morocco, Mexico, Montenegro, Netherlands Antilles, New Zealand, Norway, Pakistan, Philippines, Poland, Portugal, Romania, Russia, Serbia, Switzerland, Singapore, Slovakia, Slovenia, South Africa, Spain, Sri Lanka, Sweden, Taiwan, Tanzania, Thailand, The British Virgin Islands, Trinidad & Tobago, Tunisia, Uganda, Ukraine, The United States, Venezuela, Vietnam and Zambia.

Besides these treaties, there are many more drafts waiting to be confirmed, for example with Antigua & Barbuda, Gibraltar, Saint Kitts and Nevis, the Grenadines and Saint Vincent.

If a legal entity wants to beneficiate from the double tax regulations, he has to deposit at the Denmark tax authority the documents proving his residence in another country. After being checked, Denmark decides what method to use in deducting the taxes (exemption or credit) and decides what rates to apply at dividends, interest and royalties.

Please feel free to contact our company formation specialists in Denmark for more details and personalized consultancy in double tax treaties matters.