Company registration in DenmarkDenmark is consistently ranked one of the Europe's best place to do business, and it only takes a few hours to register a company in Copenhagen. Denmark offers a unique tax rule according to which foreign branches of a Danish company are generally not subject to paying tax in Denmark. As a result, a Danish company is an ideal platform for Nordic and European expansion from which to set up branches in other countries. Moreover, establishing a company in Denmark is simpler, faster and more cost-efficient than establishing a branch. It only takes a few hours to register a company ready for business whereas it usually takes several weeks, and is more costly, to register a branch.
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There are three ways to register a company in DenmarkA new company can be incorporated and ready for business within only a few hours by using the online electronic registration system provided by the Danish Business Authority. No requirements for local shareholders or local resident management apply. A traditional paper registration of the company will usually take two to three weeks. An “off the shelf” company is a company which has already been founded and registered but has no previous activities or operations. Such companies can be acquired and up and running from one day to the next. [lawyers-box-1] As registering a company online is fast and very cost-efficient, this is the most commonly used procedure in Denmark.
Limited liability companyThe most commonly used business entity in Denmark is a limited liability company, as it is very quick and easy to form. Two main types of limited liability company prevail:
- A/S (public limited liability company).
- ApS (private limited liability company).
Registration for VAT purposesWhen considering setting up a company in a foreign country, entrepreneurs naturally take into consideration the VAT levels. Denmark has a standard VAT rate of 25%. In certain cases, even without opening a company in Denmark, you may have to register for local VAT, according to Danish legislation; these are most often similar throughout EU countries, and it will be applied when:
- importing goods into the European Union countries via Denmark;
- buying and selling goods within Denmark;
- using local warehouse facilities in order to trade goods on the Danish market;
- distance online sales involving individuals in Denmark.