Closing a business in Denmark

Liquidating a company can feel pretty overwhelming, as it involves quite a few steps that need careful attention. It’s really important to tackle each step in the right order to keep access to your company’s online systems, which makes the whole process go a lot smoother. Plus, getting it right helps you avoid unnecessary costs, like taxes and fees that could crop up if things aren’t handled properly.

We know how important it is to get all the formalities sorted out during liquidation, and that’s why we’re here to help you every step of the way. With our support, you can relax knowing that everything will be managed according to Denmark's rules and standards.

How to carry out the process of closing a business in Denmark?

The process of winding up a business in Denmark involves several administrative and legal steps that must be followed carefully. This significant task requires thorough planning and precise execution. No matter the reason for closing the business, it’s essential to meet all the necessary formalities and legal requirements to ensure everything is done in line with Danish laws.

The first step is verifying any outstanding liabilities. At this stage, it's crucial to check if the company owes money to employees, customers, suppliers, or authorities. Ensuring that all debts are settled and obligations fulfilled helps prevent legal or financial issues during the liquidation process.

Next, you need to make a formal decision to wind up the business. For sole proprietorships, this decision must be approved by the owner. In the case of partnerships, all shareholders or board members need to agree. This formal decision is vital for moving on to the next steps in the liquidation.

Informing the relevant authorities is another important step. You must notify Danish authorities about your decision to close the company. This includes reporting the termination to the Central Register (CVR) and the Tax Authority (SKAT). Notifying these institutions is necessary for officially closing the company in public records.

As part of the liquidation process, preparing a liquidation balance sheet is essential. This document should accurately reflect the company's assets as of the liquidation date. For companies, conducting a liquidation audit may also be beneficial, ensuring that all accounts are accurate and complete. Once all liabilities are settled, the remaining assets can be distributed among partners or owners.

Reporting the liquidation to Erhvervsstyrelsen is the next step. Every Danish company is required to notify the Danish Enterprise Authority (Erhvervsstyrelsen) about the liquidation process. This can be done online through their website.

There are also additional steps to consider during the liquidation process. It’s a good idea to inform business partners, suppliers, and customers about the closure. Communicating with all parties involved helps ensure everyone is aware of the changes and can adjust accordingly. If there are alternative contacts or a plan for another company to take over responsibilities, that information should be shared as well.

Closing the company bank account is another crucial step. After settling all financial obligations and completing current operations, make sure all transactions are finalized and the account balance is zero before closing it. This process should also account for any unused funds and confirm that no further activity is expected on that account.

Finally, Danish regulations require you to keep all business-related documents for a set period, typically five years. 

Closing a company in Denmark

In Denmark, companies can be terminated for various reasons, and these situations often fall into a few main categories. One common reason is bankruptcy, which can be initiated either by the company itself or by its creditors. There’s also forced liquidation, which a court can order, and shareholders can choose to voluntarily close the business. Sometimes companies might also undergo restructuring to fix their financial issues before going for liquidation.

I. Declaring bankruptcy

Bankruptcy usually happens when a company runs out of cash and can’t pay its bills. If this occurs, the company’s management might decide to declare bankruptcy. But before that can happen, they need to file a request with the court. Interestingly, creditors can also file this request if they haven’t been paid. Once the court gets the application, it investigates the company’s finances to see whether it should go into bankruptcy or be restructured.

II. Forced liquidation  

Forced liquidation often happens when a company is closed down by a court order, usually without the owner's say-so. This can occur for various reasons, like missing the deadline for submitting annual reports, not conducting required audits after an auditor resigns, or if the Managing Director steps down. When a court decides to dissolve a company, it appoints a liquidator. This person looks closely at the company's finances to see if it can keep operating. If the company can’t pay its debts, bankruptcy proceedings may start, leading to asset sales and settling up with creditors. If the company is still in the black, it will just be shut down, and the liquidator will manage the necessary winding-up procedures.

III. Voluntary termination  
Shareholders can voluntarily close a company, but only if it’s still solvent, meaning its assets are greater than its debts. Before kicking off the liquidation process, the company needs to announce its decision publicly. This announcement gives creditors at least three months to file any claims. The company also needs to inform the commercial register to make sure everyone knows what’s happening. After this waiting period, the liquidator takes over, settling debts and distributing any remaining assets.

IV. Restructuring

If a company wants to avoid bankruptcy, it might choose to restructure instead. This option allows it to reorganize and fix its financial situation without formally declaring bankruptcy. The court appoints someone to oversee the restructuring process, making sure everything runs smoothly. This person works with creditors, monitors the restructuring plan, and takes steps to streamline the company’s operations. The goal is to help the company regain liquidity and operate more sustainably, ultimately avoiding legal troubles tied to bankruptcy.

V. Liquidation of the company

When shareholders decide to liquidate the company, they don’t have to wait for three months for creditors to file claims. However, it’s super important to handle all the formalities correctly to avoid any future headaches. Ignoring any obligations can lead to liabilities that shareholders will have to cover. Plus, it’s essential to wrap up all banking activities and cancel contracts with suppliers and service providers. Once all that’s done, the company can be legally closed without risking additional costs for the shareholders.  

Legal forms and specific procedures for closing different types of Danish businesses (ApS, A/S, sole proprietorship, IVS, partnerships)

In Denmark, the procedure for closing a business depends strongly on the legal form. The Danish Business Authority (Erhvervsstyrelsen) and the Danish Tax Agency (Skattestyrelsen/SKAT) are the two main authorities involved, but the exact steps, documents and timelines differ for ApS, A/S, sole proprietorships, IVS and partnerships. Below you will find an overview of the most important rules and practical aspects for each type of business.

Closing a private limited company (ApS)

An ApS (Anpartsselskab) is a separate legal entity with a minimum share capital of DKK 40,000. When closing an ApS, the owners can usually choose between:

• Voluntary liquidation with a liquidator
• Simplified solvent liquidation (payment of remaining capital to shareholders)
• Dissolution after bankruptcy

For a solvent ApS, the most common route is voluntary liquidation. The general meeting must pass a resolution to liquidate the company, appoint a liquidator and file the decision with the Danish Business Authority via Virk. From that point, the company name must be supplemented with “i likvidation” (in liquidation) in all communication and documents.

The liquidator prepares a statement of assets and liabilities, settles all debts, terminates contracts, collects outstanding receivables and sells or distributes assets. Before any final distribution to shareholders, all known creditors must be notified. A notice is published in the Danish Official Gazette (Statstidende), and creditors are given a deadline to file their claims, typically three months from publication.

When all obligations are settled, the liquidator prepares a final liquidation balance sheet and a proposal for distribution of the remaining equity. The general meeting approves the final accounts and distribution. The liquidator then files the final documents with the Danish Business Authority. Only after the authority has registered the dissolution is the ApS formally closed and removed from the CVR register.

During liquidation, the ApS must continue to submit tax returns, VAT returns and annual reports as long as it is registered and has activities. Corporate income tax (currently 22%) is calculated up to the final date of business activity. Any remaining tax liabilities must be paid before the company can be finally dissolved.

Closing a public limited company (A/S)

An A/S (Aktieselskab) is subject to stricter capital and governance rules than an ApS, but the closure process is largely similar. The minimum share capital is DKK 400,000, and there are typically more shareholders and a board of directors, which can make the process more complex.

The general meeting passes a resolution to liquidate the company and appoints a liquidator. The decision is filed with the Danish Business Authority, and the company name is supplemented with “i likvidation”. The liquidator then:

• Prepares an opening liquidation balance sheet
• Notifies creditors and ensures publication in Statstidende
• Settles all debts, including bank loans, supplier balances and tax liabilities
• Handles employee terminations and statutory obligations
• Prepares annual reports for the liquidation period if required

After the creditor deadline has expired and all claims have been settled or secured, the liquidator prepares a final liquidation statement and a proposal for distribution to shareholders. Once approved by the general meeting, the documents are filed with the Danish Business Authority. The A/S is dissolved when the authority registers the final liquidation and removes the company from the CVR register.

Because A/S companies often have more complex capital structures (e.g. different share classes, shareholder agreements, listed shares), additional legal and tax planning may be needed to ensure that the distribution to shareholders is handled correctly and tax-efficiently.

Closing a sole proprietorship (enkeltmandsvirksomhed)

A sole proprietorship is not a separate legal entity. The owner is personally liable for all business obligations, which makes the formal closure process simpler but increases personal risk if debts remain unpaid.

To close a sole proprietorship in Denmark, the owner must:

• Stop business activities and issue final invoices
• Settle outstanding debts with suppliers, banks and other creditors
• Pay outstanding VAT, payroll taxes and A-tax (withholding tax) if there were employees
• File the final VAT return and deregister for VAT and other schemes via Virk
• Deregister the business from the CVR register

The final business income is reported in the owner’s personal tax return. Any remaining assets (for example inventory, equipment or a car) are treated as private withdrawals at market value and may have tax consequences. If the business has been using the business scheme (virksomhedsordningen), special rules apply for the final settlement of the scheme, including taxation of retained profits and adjustments of the business account.

There is no requirement for a formal liquidation or a liquidator. However, the owner remains personally liable for all business debts even after deregistration. It is therefore important to ensure that all creditors are informed and that realistic payment agreements are made before the business is closed.

Closing an IVS (iværksætterselskab)

The IVS (entrepreneurial company) form has been abolished in Denmark, and existing IVS companies have been required to convert into ApS or be dissolved. If an IVS still exists in the process of closure, it is generally treated as an ApS for the purpose of liquidation and dissolution.

The typical steps include:

• Conversion to ApS if this has not already been done, including increasing the share capital to at least DKK 40,000
• Passing a resolution to liquidate the company as an ApS
• Appointing a liquidator and following the standard ApS liquidation procedure

Because many IVS companies have had low capitalisation and sometimes accumulated tax or supplier debts, it is important to clarify whether the company is solvent. If the company cannot pay its debts as they fall due, the management has a duty to consider filing for bankruptcy. In that case, the closure will take place through the bankruptcy court rather than through voluntary liquidation.

Closing partnerships (I/S, K/S and other personal companies)

Partnerships in Denmark, such as I/S (interessentskab) and K/S (kommanditselskab), are usually treated as transparent entities for tax purposes. The partners are personally (and in a K/S, at least one partner is personally) liable for the partnership’s obligations. The closure process therefore focuses on settling the partnership’s affairs and distributing assets and liabilities among the partners.

The starting point is the partnership agreement, which should describe how dissolution and exit of partners are handled. In practice, the partners must:

• Decide to dissolve the partnership and record the decision in writing
• Prepare a closing balance sheet showing assets, liabilities and partners’ capital accounts
• Terminate leases, supplier contracts and other agreements
• Settle debts and collect outstanding receivables
• Distribute any remaining assets or deficits between the partners according to the agreement
• Deregister the partnership from the CVR register and relevant tax schemes (VAT, payroll, etc.)

For tax purposes, each partner reports their share of the final profit or loss in their own tax return. If assets are taken over privately by one or more partners, this is treated as a transfer at market value and may trigger taxation of hidden reserves. In a K/S, special attention must be paid to the distinction between general partners (with unlimited liability) and limited partners, as this affects both liability and tax treatment.

Voluntary liquidation vs. compulsory dissolution

For ApS, A/S and some partnerships, there is an important distinction between voluntary liquidation and compulsory dissolution initiated by the Danish Business Authority. Compulsory dissolution can occur, for example, if the company fails to submit annual reports, does not have a registered management, or does not comply with capital requirements.

In a compulsory dissolution, the court may appoint a liquidator or a bankruptcy trustee, and the owners lose control over the process. This often leads to a less predictable outcome, higher costs and a greater risk of personal liability for management if there has been wrongful trading or late filing for bankruptcy. Whenever possible, it is usually preferable to plan a timely voluntary liquidation while the company is still solvent.

Choosing the right closure method for your Danish business

The optimal way to close a Danish business depends on solvency, the company’s legal form, the number of owners, existing contracts and the tax position of both the company and its owners. A small, debt-free ApS with a single shareholder can often be closed relatively quickly through a simplified liquidation, while a larger A/S with employees, long-term contracts and significant assets will require a more extensive process.

Regardless of the legal form, it is crucial to coordinate the legal steps with tax and accounting requirements: final financial statements, corporate tax and VAT, employee obligations and proper deregistration from all relevant registers. Professional advice can help avoid personal liability, unexpected tax bills and delays in the closure of your Danish business.

Tax obligations when closing a business in Denmark (VAT, corporate tax, payroll tax, duties)

When you close a business in Denmark, you must settle all tax obligations before the company can be finally deregistered. This includes VAT, corporate income tax, payroll taxes and duties. Proper planning of the final tax position helps avoid unexpected assessments, penalties and delays in the dissolution.

Final VAT obligations

If your business is VAT-registered in Denmark, you must deregister for VAT and submit a final VAT return covering the period up to the last day of taxable activity.

Key points to consider:

• Final VAT period: The final VAT return must include all sales and purchases up to the closure date, including any credit notes, corrections and private use adjustments.
• VAT on remaining assets: If you have inventory or fixed assets on which you previously deducted input VAT, you may have to account for output VAT on their value when the business ceases, unless they are sold to another VAT-registered business.
• Bad debts: You can normally adjust VAT on receivables that are definitively uncollectible at the time of closure, provided you have proper documentation.
• VAT registration threshold: Danish businesses must register for VAT when taxable turnover exceeds DKK 50,000 over a 12‑month period. Even if your turnover has fallen below this threshold before closure, you still need to file a final VAT return and deregister correctly.
• Deadlines: The deadline for the final VAT return depends on your normal VAT reporting frequency (monthly, quarterly or half‑yearly). The final period usually follows the same deadline rules as previous periods, unless the Danish Tax Agency (Skattestyrelsen) sets a specific date.

Corporate income tax on closure

For companies such as ApS and A/S, the final corporate tax position must be settled before the company can be struck off. The standard Danish corporate income tax rate is 22% on taxable profits.

Important aspects include:

• Final financial statements: You must prepare final accounts up to the date of cessation or liquidation. These form the basis for the last corporate tax return.
• Final corporate tax return: The company must file a final tax return (selvangivelse) for the last income year. As a rule, the deadline is 6 months after the end of the income year, but in liquidation the tax authorities may set specific deadlines.
• Taxation of liquidation gains: Gains on the sale of assets (for example, property, machinery, goodwill or shares) realized during the winding‑up are included in taxable income and taxed at 22%, subject to special rules for participation exemptions and tax‑exempt shareholdings.
• Losses: Any remaining tax losses in the company generally lapse when the company is finally dissolved and cannot be transferred to shareholders. Planning the use of tax losses before closure can therefore be important.
• Prepaid and outstanding tax: You must reconcile preliminary tax payments (a‑conto skat) with the final tax liability. Any underpayment will trigger an additional payment with interest and possible surcharges, while overpaid tax can be refunded to the company before dissolution.

Payroll tax, A‑tax and labour market contributions

If your Danish business has employees, you must settle all payroll‑related obligations when closing. This includes A‑tax (withholding tax on salaries), AM‑bidrag (labour market contribution) and reporting via e‑Indkomst.

• A‑tax and AM‑bidrag: Employers must withhold A‑tax according to the employee’s tax card and 8% AM‑bidrag on gross salary. All withheld amounts must be reported and paid to Skattestyrelsen up to the last payroll date.
• Final e‑Indkomst reporting: You must submit final salary reports for all employees and mark the employment as terminated with the correct end date.
• Holiday pay and other benefits: Accrued holiday pay, bonuses and other taxable benefits paid on termination must be included in the final payroll and reported for tax purposes.
• Employer obligations to funds: Contributions to ATP (Labour Market Supplementary Pension) and any other mandatory schemes must be settled for the final period of employment.

Excise duties and other indirect taxes

If your business is registered for Danish excise duties (for example on energy, packaging, alcohol or certain goods), you must file final duty returns and deregister from the relevant schemes.

• Ensure that all dutiable goods moved, sold or consumed up to the closure date are included in the final duty calculations.
• Check whether any stock on hand at closure triggers additional duty or can be transferred duty‑suspended to another registered entity.

Tax audits, documentation and risk management

The Danish Tax Agency may review your final VAT and tax returns, especially if the business has significant write‑offs, asset disposals or cross‑border transactions. Keeping complete documentation for at least the statutory retention period is essential to handle any later queries or audits.

Before initiating the formal closure, it is advisable to:

• Reconcile all tax accounts (VAT, corporate tax, A‑tax, AM‑bidrag, duties) with the balances shown in TastSelv Erhverv
• Correct any missing or late filings to reduce the risk of penalties
• Clarify the tax treatment of major transactions during the winding‑up, such as sale of business assets or transfer of activities

Properly managing these tax obligations helps ensure that the Danish authorities can approve the deregistration and that the business can be closed without outstanding tax risks.

Employee-related obligations when terminating a business (notice periods, severance, holiday pay, ATP, pension)

When you close a business in Denmark, you must handle your employee obligations correctly and on time. Danish employment law is protective of employees, and errors in notice, severance, holiday pay or pensions can lead to costly claims and delays in the closure process.

Notice periods when terminating employees

For salaried employees covered by the Danish Salaried Employees Act (funktionærloven), statutory notice periods depend on length of service and must be respected even if the business is closing:

• Up to 6 months’ seniority: 1 month’s notice
• More than 6 months and up to 3 years: 3 months’ notice
• More than 3 years and up to 6 years: 4 months’ notice
• More than 6 years and up to 9 years: 5 months’ notice
• More than 9 years: 6 months’ notice

These are minimum statutory periods. Collective agreements (overenskomster) or individual contracts can grant longer notice. For blue-collar workers and employees covered by collective agreements, notice periods and procedures are set in the relevant agreement and must be checked carefully before issuing termination letters.

Notice must be given in writing and should clearly state the reason for termination (closure of business), the last working day and information about holiday, severance and other entitlements. In some cases, you may place employees on garden leave during the notice period, but they must still receive full salary and benefits.

Severance pay and special compensation

Under the Salaried Employees Act, employees with long seniority may be entitled to statutory severance pay in addition to salary during the notice period:

• At least 12 years’ continuous employment: severance equal to 1 month’s salary
• At least 15 years’ continuous employment: severance equal to 2 months’ salary
• At least 18 years’ continuous employment: severance equal to 3 months’ salary

Collective agreements can provide for severance after shorter seniority or at different levels, and some agreements include special “seniority bonuses” or redundancy packages in case of closure. These obligations apply even if the company is insolvent, although in insolvency situations some claims may be covered by the Employees’ Guarantee Fund (Lønmodtagernes Garantifond).

Unlawful or defective terminations (for example, discriminatory dismissals or failure to follow special rules for protected employees such as shop stewards, pregnant employees or employees on parental leave) can trigger additional compensation. When planning a closure, it is important to identify any protected employees and follow the specific rules that apply to them.

Holiday pay and outstanding entitlements

On closure, all accrued but unused holiday must be settled in accordance with the Danish Holiday Act (ferieloven). The general rules are:

• Employees earn 2.08 days of paid holiday per month of employment, up to 25 days per holiday year.
• Upon termination, you must pay out all accrued but unused holiday allowance (feriepenge), including holiday supplement (ferietillæg) if applicable.
• For employees covered by the Holiday Act with holiday allowance paid to a holiday fund, you must report and transfer outstanding holiday pay to FerieKonto or another approved holiday scheme.
• For employees who receive paid holiday directly from the employer (typical for some salaried employees), you must settle the value of remaining holiday days with the final salary.

Holiday pay is usually calculated as 12.5% of the employee’s qualifying salary for the earning period, unless a collective agreement or contract specifies another method that is compliant with the Holiday Act. Any outstanding holiday supplement (typically 1% of annual salary for salaried employees) must also be settled.

ATP contributions when closing the business

ATP (Arbejdsmarkedets Tillægspension) is a mandatory labour market supplementary pension scheme. As an employer, you must ensure that all ATP contributions are paid up to the employee’s final day of employment. Contributions are shared between employer and employee and depend on the employee’s working hours.

When you terminate all employees as part of the closure, you must:

• Report the final employment end date for each employee via eIndkomst (E-income)
• Pay the final ATP contributions for the last contribution period
• Correct any missing or incorrect ATP registrations for previous periods

Failure to pay ATP correctly can result in demands for back payments and interest. Before the company is finally deregistered, it is advisable to reconcile ATP payments with payroll records to ensure that all obligations are fulfilled.

Occupational and private pension schemes

Many employees in Denmark are covered by occupational pension schemes through collective agreements or individual contracts. These typically include contributions to retirement savings, insurance for loss of earning capacity and life insurance.

When closing the business, you must:

• Pay all outstanding employer and employee pension contributions up to the last day of employment
• Notify the pension provider about the termination of employees and the closure of the employer agreement
• Ensure that contributions reported via payroll match the amounts actually transferred to the pension provider

Collective agreements often specify minimum contribution rates (for example, a total contribution of 12–18% of the employee’s pensionable salary, split between employer and employee). These minimums must be respected until the employment relationship ends. Employees usually keep their accrued pension savings even after the company closes, but they may need information from you or the pension provider about their options.

Other employee-related obligations

In addition to notice, severance, holiday pay and pensions, you must also handle several other obligations when terminating a business with staff:

• Final salary and benefits: Pay all outstanding salary, overtime, bonuses, commissions and allowances up to the last working day, including value of any benefits that must be compensated in cash.
• Statutory reporting: Report final income, A-tax (withholding tax) and labour market contributions (AM-bidrag) via eIndkomst, and ensure that all payroll taxes are settled with the Danish Tax Agency (Skattestyrelsen).
• Mass redundancies: If you employ a certain number of employees and the closure triggers collective redundancies, you may be subject to special notification and consultation rules under the Danish Act on Collective Redundancies. This can involve notifying the Regional Labour Market Council and informing employee representatives within specific deadlines.
• Employee documentation: Provide employees with final payslips, holiday pay information, pension information and, where relevant, employment certificates or references.
• Data and record-keeping: Keep employment and payroll records for the legally required retention periods even after the company is closed, in case of later claims or audits.

Properly managing employee-related obligations when closing a business in Denmark is essential for a smooth and legally compliant winding-up process. Early planning, accurate payroll calculations and timely communication with employees, authorities and pension providers help minimise risks and unexpected costs.

Settlement of company debts and obligations towards creditors before closure

Before a Danish company can be formally closed, its debts and obligations towards creditors must be settled or otherwise lawfully dealt with. This is a key requirement both in voluntary liquidation and in most other closure procedures, and the Danish Business Authority (Erhvervsstyrelsen) as well as the Danish Tax Agency (Skattestyrelsen) will not accept a closure if significant liabilities remain unaddressed.

Identifying all creditors and liabilities

The first step is to prepare a complete overview of all outstanding obligations. This typically includes:

• Trade creditors and suppliers (unpaid invoices, service contracts, leases)
• Banks and other lenders (overdrafts, term loans, guarantees)
• Tax authorities (corporate income tax, VAT, payroll taxes, A-tax, AM-bidrag, duties)
• Employees (salaries, holiday pay, bonuses, severance, pension contributions)
• Landlords (rent, deposits, restoration costs)
• Utilities and telecom providers
• Leasing companies (cars, machinery, IT equipment)
• Group companies and shareholders (intercompany balances, shareholder loans)

All contracts should be reviewed to identify notice periods, termination fees and any clauses that may be triggered by closure or insolvency (for example, acceleration of loans or guarantees).

Order of priority and creditor protection

In Denmark, creditors are protected by statutory rules on priority of claims, especially in formal liquidation or bankruptcy. As a general principle, the following order applies when assets are distributed in an insolvent estate:

1. Costs of the estate and legal proceedings (court fees, liquidator or trustee fees)
2. Certain employee claims (wages, holiday pay and some other employment-related claims, often covered by the Employees’ Guarantee Fund)
3. Secured creditors (for example, banks with security in assets, mortgages, pledges)
4. Unsecured creditors (suppliers, tax authorities, landlords, etc.)
5. Subordinated claims (for example, some shareholder loans if contractually subordinated)
6. Shareholders (only if all creditors have been paid in full)

In a solvent, voluntary liquidation, all creditors must be paid in full before any remaining assets can be distributed to the owners. Any selective or preferential treatment of certain creditors may be challenged if the company later proves to be insolvent.

Negotiating and settling debts

If the company is solvent, debts are normally paid according to the agreed terms. Where liquidity is tight but the company is still viable, it may be possible to negotiate:

• Extended payment deadlines or instalment plans
• Partial write-offs or settlement agreements
• Conversion of debt into equity (for group companies or related parties)

For tax debts, Skattestyrelsen may in some cases accept instalment arrangements, but will typically require timely filing of all tax returns and realistic payment plans. Interest and surcharges can apply if payments are delayed.

Handling tax and public-law obligations

Before closure, the company must ensure that all tax and duty obligations are correctly calculated and settled. This usually includes:

• Final VAT return up to the date of cessation of taxable activities
• Final payroll reporting (eIndkomst) and payment of A-tax and AM-bidrag for employees
• Corporate income tax for the final income year, including any exit taxation if assets are transferred abroad or to owners
• Settlement of excise duties and other sector-specific taxes, if applicable

Any outstanding balances with Skattestyrelsen should be reconciled. If the company has VAT or tax receivables, these can usually be refunded and form part of the assets available to pay other creditors.

Employee-related liabilities

Employee claims must be handled carefully, as they enjoy special protection under Danish law. Typical obligations include:

• Salary up to the termination date
• Accrued holiday pay and holiday allowances
• Notice pay according to the Danish Salaried Employees Act (Funktionærloven) or collective agreements
• Bonus, commission and other variable pay earned up to closure
• Outstanding pension contributions and ATP contributions

In case of insolvency, the Employees’ Guarantee Fund (Lønmodtagernes Garantifond) may cover certain employee claims, but the company and its management must still comply with the formal rules on termination and notification.

Secured creditors, leases and long-term contracts

Secured creditors, such as banks with security in receivables, inventory or fixed assets, must be informed about the planned closure. Security arrangements and covenants should be reviewed, and the parties must agree on how the collateral will be realised or released.

For leases and long-term contracts, the company must:

• Observe contractual notice periods
• Clarify any early termination fees or penalties
• Agree on the return condition of leased assets (vehicles, equipment, premises)
• Document the handover to avoid later disputes

Dealing with shareholder loans and related-party balances

Balances between the company and its owners or group entities must be settled before closure. This may involve:

• Repayment of loans from shareholders to the company
• Repayment of loans from the company to shareholders (which may have tax implications if not repaid)
• Offsetting intercompany balances where legally possible

Improper handling of shareholder loans, especially if the company is or becomes insolvent, can lead to personal liability for management and tax reclassification of loans as taxable distributions.

Documentation and communication with creditors

Throughout the closure process, it is important to document all settlements and agreements with creditors. This includes:

• Written confirmations of paid and closed accounts
• Settlement agreements and payment plans
• Receipts for tax and duty payments
• Termination letters for contracts and leases

Transparent communication with key creditors reduces the risk of disputes and can facilitate smoother negotiations, especially where the company needs time to liquidate assets to pay its debts.

Consequences of unpaid debts at closure

If a company is unable to pay its debts as they fall due, it may be considered insolvent and should not distribute assets to shareholders. In such cases, management is generally expected to consider formal insolvency proceedings, such as bankruptcy, rather than attempting a standard voluntary closure.

Failure to treat creditors correctly can result in:

• Personal liability for members of the management or board
• Claw-back of certain payments made to related parties or selected creditors
• Criminal or administrative sanctions in cases of gross negligence or fraud

Careful planning of the settlement of debts and obligations is therefore essential to ensure that the closure of a Danish company is lawful, efficient and minimises risk for owners and management.

Deregistration from Danish authorities and registers (CVR, SKAT, VAT, E-income, NemID/MitID Erhverv)

When you decide to close a business in Denmark, proper deregistration from all relevant authorities and registers is essential. Failing to deregister correctly can result in continued tax assessments, fees and legal responsibilities, even if you have stopped trading. Below you will find an overview of the key deregistrations that typically need to be handled: CVR, SKAT (Danish Tax Agency), VAT, E‑income and NemID/MitID Erhverv.

Deregistering the company in the CVR register

All Danish businesses are registered in the Central Business Register (CVR). When you close a company, you must notify the Danish Business Authority (Erhvervsstyrelsen) so that the CVR registration can be updated or removed.

For most legal forms (ApS, A/S, partnerships and sole proprietorships), deregistration is done digitally via Virk.dk. In practice, this means:

• Submitting a notification of cessation of business activities
• Indicating the effective date of closure (the last day of business activity)
• Ensuring that all mandatory filings (annual reports, tax returns, VAT returns) are submitted up to the closing date

For limited liability companies (ApS and A/S), the CVR status will only be finally changed to “dissolved” once the formal liquidation or compulsory dissolution process is completed. For sole proprietorships and most partnerships, the CVR number is usually deactivated shortly after the closure notification is processed.

Notifying SKAT and final tax registration updates

SKAT (the Danish Tax Agency) must be informed that the business has ceased. This is typically done through TastSelv Erhverv or via your accountant. Key elements include:

• Updating the business tax registration to indicate cessation of activities
• Submitting final corporate income tax returns (for companies) or business income statements (for sole proprietors)
• Ensuring that advance tax (B‑tax for self‑employed, preliminary corporate tax for companies) is adjusted so that you do not continue to receive payment demands after closure

For companies subject to corporate income tax, the final tax year ends on the date of cessation or at the end of the financial year in which the company is liquidated, depending on the chosen liquidation method. Any tax losses, depreciation balances and deferred tax items must be settled in the final tax return.

Deregistration from VAT (moms)

If your business is registered for VAT, you must deregister the VAT number when you stop taxable activities. This is done via Virk.dk by changing your VAT registration and indicating the last day on which you carried out VAT‑liable transactions.

Important points when deregistering VAT:

• You must submit a final VAT return covering the period up to the closing date
• You must account for VAT on remaining stock and fixed assets if they are taken over privately or transferred without consideration, based on their market value
• You must correct any outstanding VAT adjustments (for example, for investment goods subject to multi‑year adjustment rules)

After deregistration, you are no longer allowed to issue invoices with Danish VAT, and you will not be able to deduct input VAT on costs incurred after the effective closure date, except in limited situations related to the liquidation itself.

Closing payroll registrations and E‑income

If you have had employees, you must deregister as an employer and stop reporting via the E‑income system. This includes:

• Registering the last salary payment date for all employees
• Submitting final E‑income reports for wages, holiday pay, benefits in kind and other taxable remuneration
• Ensuring that A‑tax (withholding tax) and AM‑bidrag (labour market contribution) are fully settled

Once the final payroll period is reported and all liabilities are paid, you can deregister as an employer via Virk.dk. Remember to also close or transfer related schemes such as ATP contributions, occupational injury insurance and any collective pension agreements.

Deregistering from other tax schemes (PAYE, excise duties, etc.)

Many businesses are registered for additional schemes beyond standard VAT and corporate tax. When closing a company, you should review and deregister from any of the following that apply:

• PAYE schemes for foreign employees (for example, researchers’ tax scheme)
• Excise duties (energy, packaging, environmental taxes)
• Import/export registrations, including EORI numbers used in customs procedures

Each scheme has its own final reporting requirements and deadlines. All outstanding returns must be filed and payments made before the deregistration can be completed.

NemID/MitID Erhverv and digital mailboxes

Digital identification and communication tools must also be handled when closing a Danish business. For most companies this means:

• Reviewing and, when appropriate, closing or limiting MitID Erhverv roles and user access
• Ensuring that the company’s Digital Post (e‑Boks/Virk) mailbox is monitored until all authorities have confirmed deregistration and no new messages are received
• Downloading and archiving important correspondence and decisions from authorities before access is removed

In many cases, the legal representative or liquidator will keep MitID Erhverv access active during the liquidation process to handle ongoing communication with SKAT, Erhvervsstyrelsen and other authorities. Access is typically revoked only once all procedures are completed and the company is finally dissolved.

Practical sequence and timing

In practice, deregistration from Danish authorities and registers is not done all at once but follows the actual closure process. A typical sequence is:

1. Decision to close the business and preparation of a closure or liquidation plan
2. Notification to Erhvervsstyrelsen and update of CVR data
3. Deregistration from VAT and employer schemes as soon as trading and payroll stop
4. Submission of final VAT, payroll and tax returns to SKAT
5. Ongoing use of MitID Erhverv to communicate with authorities until all matters are settled
6. Final deactivation of digital access and confirmation that the CVR status is “dissolved” or “ceased”

Coordinating these steps correctly reduces the risk of additional assessments, penalties or delays in the final dissolution of your Danish company. Professional assistance can help ensure that all registrations are closed in the right order and within the required deadlines.

Handling of company assets on closure (inventory, fixed assets, intellectual property, goodwill)

When closing a business in Denmark, the correct handling of company assets is crucial for both legal compliance and tax optimisation. Assets such as inventory, fixed assets, intellectual property and goodwill must be identified, valued, realised or transferred, and properly reported to the Danish Tax Agency (Skattestyrelsen) and other authorities.

Inventory and stock

All inventory must be counted and valued as of the effective closing date. The valuation is normally based on the lower of cost and net realisable value, in line with Danish accounting rules. Unsold stock can be:

• sold to customers or wholesalers at market price
• transferred to the owners (which is treated as a sale at market value for tax and VAT purposes)
• written off if it is obsolete or unsellable, with appropriate documentation

For VAT-registered businesses, the sale or transfer of inventory is generally subject to 25% Danish VAT, unless the goods are VAT-exempt or the transfer qualifies as a transfer of a going concern. Any remaining input VAT adjustments on inventory must be settled in the final VAT return.

Fixed assets (machinery, equipment, vehicles, property)

Fixed assets must be listed and valued before liquidation or closure. This includes machinery, IT equipment, furniture, vehicles and, where relevant, real estate. Key steps include:

• determining market value for each asset (for sales, transfers to owners or scrapping)
• calculating balancing income or loss for tax purposes in the relevant depreciation pools
• settling any remaining finance leases or loans secured on the assets

For tax purposes, Danish companies typically depreciate assets in pools (for example, operating equipment and machinery at up to 25% declining balance per year). On closure, the difference between the tax value of the pool and the sales proceeds may result in taxable income or a deductible loss. The sale or private transfer of fixed assets is usually subject to 25% VAT, unless the asset is VAT-exempt (for example certain real estate or passenger cars with restricted VAT deduction).

Intellectual property (IP)

Intellectual property rights such as trademarks, patents, software, domain names and copyrights are often overlooked when closing a Danish company. These assets should be:

• identified and documented (registrations, licences, contracts)
• valued at fair market value, especially if transferred to owners or related companies
• formally assigned or terminated with the relevant registries and contractual partners

Transfers of IP to shareholders or group companies must be made on arm’s length terms under Danish transfer pricing rules. Gains on IP may be taxable as ordinary income at the corporate tax rate of 22%. If IP has been developed internally, the tax basis may be low, which can lead to a significant taxable gain on transfer or sale.

Goodwill and business value

Goodwill represents the value of the business beyond its identifiable assets, such as customer relationships, brand and reputation. When a Danish company is sold before closure, part of the purchase price is often allocated to goodwill. In a pure liquidation, goodwill may have limited value, but it must still be considered if:

• the business (or part of it) is sold as a going concern before formal dissolution
• activities, customers and contracts are transferred to another company owned by the same shareholders

For the seller, gains on goodwill are generally taxable; for the buyer, goodwill can usually be depreciated for tax purposes over a number of years. The allocation of the purchase price between tangible assets, IP and goodwill should be documented and consistent with Danish tax rules and the arm’s length principle.

Transfers to owners and related parties

When assets are distributed to shareholders or owners instead of being sold to third parties, Danish rules require that the transfer is made at market value. This has several consequences:

• the company is treated as if it had sold the asset at market price (potential taxable gain or loss)
• for VAT-registered businesses, output VAT may be due on the deemed sale
• for shareholders, the value received is treated as a liquidation distribution, which may be taxed as dividend or capital gain depending on their status

Particular care is needed when assets are transferred to foreign owners or group companies, as Danish transfer pricing and documentation requirements apply.

Documentation and reporting

Proper documentation of asset handling is essential during the closure process. At a minimum, you should prepare:

• a complete asset register as of the closing date
• valuation documentation for significant assets and IP
• sales contracts, invoices and transfer agreements
• calculations of tax depreciation, balancing income/loss and VAT adjustments

These records support the final financial statements, corporate tax return and VAT return, and must be retained for the statutory period required under Danish law after the business has been closed.

Voluntary liquidation vs. compulsory dissolution by the Danish Business Authority – key differences

When you close a company in Denmark, there is a fundamental difference between a voluntary liquidation initiated by the owners and a compulsory dissolution initiated by the Danish Business Authority (Erhvervsstyrelsen). Understanding these differences is crucial for planning the exit, protecting the owners’ liability position and avoiding unnecessary costs or tax risks.

What is voluntary liquidation in Denmark?

Voluntary liquidation (frivillig likvidation) is a controlled process initiated by the shareholders or owners when the company is solvent and able to pay all its debts as they fall due. It is typically used for ApS and A/S companies that are no longer needed, for example after a restructuring, sale of business activities or retirement of the owner.

Key characteristics of voluntary liquidation include:

• Decision by owners: The general meeting passes a resolution to liquidate the company and appoints a liquidator (often a lawyer or accountant).
• Solvency requirement: The company must be able to settle all liabilities in full. If insolvency appears during the process, the liquidator must consider filing for bankruptcy.
• Orderly settlement of affairs: The liquidator realises assets, collects receivables, pays creditors, handles contracts and prepares final accounts.
• Notice period for creditors: A notice to creditors is published via the Danish Business Authority, giving creditors a fixed period to submit claims before final distribution to shareholders.
• Final distribution to owners: After all known debts, taxes and costs are paid, remaining assets or cash are distributed to shareholders as liquidation proceeds.
• Planned tax handling: The process allows for tax planning regarding corporate tax, VAT deregistration and the taxation of liquidation proceeds at shareholder level.

Voluntary liquidation is generally the preferred route if the company is compliant, solvent and the owners want a predictable, transparent closure with minimal reputational and legal risk.

What is compulsory dissolution by the Danish Business Authority?

Compulsory dissolution (tvangsopløsning) is initiated by the Danish Business Authority when a company fails to comply with key legal obligations. It is not a tax or insolvency procedure in itself, but an administrative measure to remove non-compliant entities from the register.

Typical reasons for compulsory dissolution include:

• Failure to file annual financial statements on time
• Lack of a registered management (e.g. all directors have resigned and no new board or management is registered)
• Missing registered address in Denmark or returned official mail
• Failure to provide required information or documentation requested by the authorities
• Other serious breaches of the Companies Act or registration rules

When the Danish Business Authority initiates compulsory dissolution, the company is usually referred to the Danish Maritime and Commercial High Court (Sø- og Handelsretten) or another competent court, which appoints a liquidator or trustee to handle the winding-up. The owners lose control over the process and cannot freely decide on the timing or method of closure.

Main differences between voluntary liquidation and compulsory dissolution

Although both procedures end with the company being removed from the Danish register (CVR), they differ significantly in control, timing, costs and risk exposure.

• Who initiates the process
  Voluntary liquidation is initiated by the shareholders or owners through a formal resolution. Compulsory dissolution is initiated by the Danish Business Authority due to non-compliance, often without the owners’ consent.
• Control over the process
  In a voluntary liquidation, the owners choose the liquidator, can plan the timing and have influence over practical decisions, as long as creditor interests are protected. In a compulsory dissolution, the court appoints the liquidator, and the owners have limited influence and must cooperate with the court-appointed liquidator.
• Reason for closure
  Voluntary liquidation is usually a strategic or commercial decision: the company has fulfilled its purpose, is being restructured or the owners are exiting the market. Compulsory dissolution is a sanction for non-compliance, such as missing annual reports or lack of management.
• Solvency and financial situation
  Voluntary liquidation presupposes that the company is solvent and can pay all creditors in full. If the company is insolvent, bankruptcy proceedings are normally required instead. In compulsory dissolution, the company may be solvent or insolvent; if insolvency is identified, the process may turn into bankruptcy.
• Costs and efficiency
  Voluntary liquidation costs can be planned and are usually lower overall, because the process is more efficient and there is less need for investigative work. Compulsory dissolution often leads to higher legal and administrative costs, as the court-appointed liquidator must investigate the company’s affairs and possible management liability.
• Risk of management and owner liability
  In voluntary liquidation, if the company has been run properly and all creditors are paid, the risk of personal liability for management and owners is limited. In compulsory dissolution, the liquidator is required to examine whether there has been wrongful trading, illegal loans to shareholders, missing bookkeeping or other breaches that could trigger personal liability claims.
• Reputation and relationship with authorities
  Voluntary liquidation signals orderly and responsible behaviour towards creditors, employees and authorities. Compulsory dissolution is visible in public records and may negatively affect the reputation of the owners and management, and can influence future dealings with banks and authorities.
• Possibility to reverse the process
  In some cases, a company that has been put into compulsory dissolution can be “reinstated” if all missing filings and obligations are quickly brought up to date and the court or Danish Business Authority accepts the request. In voluntary liquidation, once the process has advanced beyond certain stages and assets have been distributed, reversal is practically difficult or impossible.

Which option is better for your Danish company?

If your company is still compliant and solvent, initiating a voluntary liquidation before problems arise is almost always preferable to waiting for the Danish Business Authority to start compulsory dissolution. It gives you control over timing, costs and communication with stakeholders, and significantly reduces the risk of personal liability issues.

If your company has already received warnings from the Danish Business Authority or has been referred to compulsory dissolution, it is important to act quickly. Professional assistance can help you assess whether it is possible to restore compliance and avoid compulsory dissolution, or whether you should cooperate with the court-appointed liquidator and focus on limiting risks for owners and management.

Timeframe and typical stages of the business closure process in Denmark

The timeframe for closing a business in Denmark depends on the legal form of the company, whether it is solvent, and which procedure is chosen. In practice, a straightforward voluntary liquidation of a solvent ApS or A/S will typically take from a few months up to around a year, while a simple deregistration of a sole proprietorship can often be completed within weeks. Below is an overview of the usual stages and indicative timelines for the most common situations.

1. Preparation and decision to close (1–4 weeks)

The process starts with an internal decision to cease business activities. For companies with limited liability (ApS and A/S), the shareholders’ meeting must pass a formal resolution to liquidate or dissolve the company. This stage usually includes:

• Reviewing the company’s financial situation to confirm whether it is solvent
• Choosing the method of closure (voluntary liquidation, solvent dissolution without liquidation, or bankruptcy if insolvent)
• Preparing minutes of the shareholders’ resolution and appointing a liquidator if required
• Agreeing on a closure date for operations, employees and contracts

For sole proprietorships and simple partnerships, the decision is typically made by the owner(s) and documented internally, without a formal shareholders’ meeting.

2. Stopping business activities and updating registrations (1–8 weeks)

Once the decision is made, the company should gradually stop its commercial activities and update its registrations with the Danish authorities. Typical actions include:

• Stopping new sales and contracts, and informing key customers and suppliers
• Terminating leases and service agreements in line with notice periods
• Notifying employees and observing statutory or contractual notice periods
• Updating registrations in the Central Business Register (CVR) and with the Danish Tax Agency (Skattestyrelsen), including VAT, payroll tax and E-income

For a sole proprietorship, deregistration of VAT and employer obligations via virk.dk can often be completed quickly, but the effective date must reflect the actual end of taxable activities.

3. Voluntary liquidation of a solvent ApS or A/S (typically 3–12 months)

If a Danish limited liability company is solvent, the most common route is voluntary liquidation. The process usually involves the following stages:

1. Shareholders’ resolution and appointment of liquidator
   The general meeting passes a resolution to enter into voluntary liquidation and appoints a liquidator. The decision is filed with the Danish Business Authority (Erhvervsstyrelsen) via virk.dk. From this point, the company name is supplemented with “i likvidation” (in liquidation).
2. Public notice to creditors and waiting period
   The Danish Business Authority publishes a notice to creditors in the public register. Creditors are given a deadline to submit their claims. The statutory notice period is normally 3 months from publication. During this time, the liquidator collects receivables, settles debts and realises assets.
3. Settlement of debts and preparation of liquidation accounts
   Before the company can be finally dissolved, all known debts must be paid, including:
   • Outstanding VAT and payroll taxes reported to Skattestyrelsen
   • Corporate income tax for the final income year (current corporate tax rate: 22%)
   • Employee-related obligations such as holiday pay, ATP contributions and pensions
   • Trade creditors, bank loans and other liabilities
   The liquidator prepares a final liquidation balance sheet and a statement of distribution.
4. Distribution to shareholders
   Once all creditors are satisfied and the 3‑month notice period has expired, any remaining equity can be distributed to shareholders as liquidation proceeds. The tax treatment depends on the shareholder’s status (Danish or foreign, individual or company) and the size of the shareholding.
5. Final approval and deregistration
   The final liquidation accounts and documentation are submitted to the Danish Business Authority. After approval, the company is formally dissolved and removed from the CVR register. At this point, the company’s VAT and employer registrations should already have been closed, and final tax returns filed.

In uncomplicated cases, voluntary liquidation can be completed in around 4–6 months, but if there are disputes, complex assets or tax audits, the process may extend to 12 months or more.

4. Alternative solvent procedures: dissolution without liquidation and fast-track models

In some cases, a solvent Danish company can be closed through a simplified dissolution without a full liquidation process, for example by transferring all assets and liabilities to a parent company or buyer. This is often used in group restructurings. The timeframe can be shorter than a standard liquidation, but still requires:

• Formal corporate resolutions and documentation of the transfer
• Notification to the Danish Business Authority
• Final tax returns and settlement of any remaining obligations

The exact duration depends on the complexity of the transaction and any required approvals from banks, landlords or other counterparties.

5. Bankruptcy and compulsory dissolution (often 6–24 months)

If the company is insolvent and cannot meet its obligations, the closure process is usually handled through bankruptcy (konkurs) or compulsory dissolution initiated by the Danish Business Authority. In these cases, the timeframe is typically longer and less predictable:

• The bankruptcy court appoints a trustee (curator), who takes control of the company
• The trustee realises assets, reviews claims and distributes any proceeds to creditors according to statutory priority rules
• Tax and VAT matters are handled in cooperation with Skattestyrelsen

Bankruptcy proceedings can last from several months to several years, depending on the size of the estate, disputes with creditors and any legal actions. The company is finally removed from the register when the bankruptcy is closed.

6. Tax and VAT finalisation (parallel stage, usually 1–6 months)

Throughout the closure process, tax and VAT matters run in parallel. Typical steps and deadlines include:

• Filing the final VAT return and paying any outstanding VAT within the normal VAT period deadlines (monthly, quarterly or half-yearly, depending on registration)
• Submitting the final corporate income tax return for the last income year and paying 22% corporate tax on taxable profits
• Filing final payroll reports in E-income and settling A-tax and AM-bidrag (labour market contribution) for employees
• Ensuring that any withholding obligations on dividends or liquidation proceeds are fulfilled

Tax authorities may review the final returns and request additional documentation, which can extend the overall timeframe, even after the company is technically dissolved.

7. Post-closure obligations and document retention (up to 5 years or more)

Even after the company is removed from the CVR register, certain obligations continue for a defined period. Under Danish bookkeeping rules, accounting records, vouchers and key corporate documents must generally be kept for at least 5 years from the end of the financial year to which they relate. This applies to both companies and sole proprietorships.

Former owners and directors should ensure that someone is responsible for storing these records and able to respond to any queries from the Danish Tax Agency or other authorities during this period.

Overall, the typical stages of closing a business in Denmark follow a clear pattern: decision and planning, stopping activities, settling obligations, formal liquidation or dissolution, and post-closure record keeping. Careful coordination of legal, tax and practical steps helps to keep the timeframe under control and reduces the risk of delays or unexpected liabilities.

Common mistakes and risks when closing a company in Denmark – and how to avoid them

Closing a Danish company is a formal legal and tax process. Even small mistakes can lead to extra tax, personal liability for directors, fines from the Danish authorities or a significantly longer processing time. Below are the most common pitfalls we see in practice – and how to avoid them.

1. Stopping activity without formally deregistering the company

Many owners simply stop issuing invoices and paying bills and assume the business is “closed”. In Denmark, a company or sole proprietorship continues to exist – and to have tax and reporting obligations – until it is formally deregistered with the Danish Business Authority (Erhvervsstyrelsen) and the Danish Tax Agency (Skattestyrelsen).

If you do not deregister correctly:

• VAT returns and payroll reports (eIndkomst) will still be expected
• Automatic estimates and tax assessments may be issued
• Late filing penalties and interest can accrue

To avoid this, always submit the relevant deregistration via Virk.dk (for CVR, VAT, employer registration, etc.) and ensure you receive confirmation that the registrations have been cancelled.

2. Forgetting final VAT and tax returns

A frequent mistake is to deregister for VAT and then forget the final VAT return, or to close the company without filing the last corporate tax return.

Key points to remember:

• VAT (moms): You must file a final VAT return up to the deregistration date. All sales, purchases, corrections and adjustments (e.g. for fixed assets) must be included.
• Corporate income tax (selskabsskat): The standard corporate tax rate is 22%. A final tax return must be filed for the last income year, including any liquidation gains or losses.
• Personal tax: For sole proprietors, business income must be included in the personal tax return for the final year, and any business scheme (virksomhedsordningen) must be settled.

Missing or incomplete final returns can result in estimated assessments, which are often higher than the actual tax due, and may trigger audits.

3. Not settling all debts and obligations before liquidation

Closing a company without a clear overview of debts and obligations is risky. In Denmark, creditors must be treated fairly, and in a formal liquidation the liquidator must ensure that all known creditors are paid before any distribution to shareholders.

Typical oversights include:

• Unpaid suppliers and service providers
• Outstanding VAT, A-tax (PAYE), AM-bidrag (labour market contribution) and corporate tax
• Holiday pay, ATP and pension contributions for employees
• Lease termination costs and guarantees

If assets are distributed to owners while creditors remain unpaid, directors and in some cases shareholders can become personally liable. To avoid this, prepare a complete list of creditors, reconcile all accounts and ensure sufficient funds are reserved before any payout to owners.

4. Ignoring employee rights and termination rules

Employee-related mistakes are among the most expensive when closing a Danish business. Danish employment law and collective agreements provide employees with strong protection.

Common errors include:

• Not respecting contractual or statutory notice periods
• Failing to pay accrued holiday pay (feriepenge) according to the Danish Holiday Act
• Not reporting and paying ATP contributions up to the final employment date
• Overlooking collective agreement rules on severance pay and special bonuses

Before giving notice, review each employee’s contract, applicable collective agreement and seniority. Calculate the total cost of termination, including notice, holiday pay, pension contributions and any severance. Incorrect or late payments can lead to claims, court cases and additional compensation.

5. Distributing assets before the legal waiting period

In a voluntary liquidation of an ApS or A/S, the Danish Business Authority requires a creditor notice period (proklama) before final distribution of assets. If assets are distributed too early, and a creditor later appears, the liquidator and shareholders may have to repay funds.

To avoid this risk:

• Follow the formal liquidation procedure, including publication of the creditor notice
• Wait until the statutory waiting period has expired and all known claims are settled
• Document all creditor contacts and payments carefully

6. Underestimating the tax consequences for owners

Many owners focus only on the company’s tax and forget that liquidation can trigger tax at shareholder level. In Denmark, distributions in connection with liquidation are normally treated as a sale of shares.

Typical issues:

• Misclassifying liquidation proceeds as tax-free dividends instead of capital gains
• Ignoring share acquisition costs and previous losses, leading to overpaid tax
• Not considering participation exemption rules for corporate shareholders

For individuals, gains on shares are taxed as share income at progressive rates. For companies, gains may be exempt if the participation exemption conditions are met. A proper calculation of the tax basis for the shares is essential before deciding on the form and timing of the liquidation.

7. Poor handling of company assets and intellectual property

Transferring assets out of the company at undervalue, or “forgetting” to account for them, is a frequent mistake that can have both tax and legal consequences.

Risk areas include:

• Sale of inventory, equipment or vehicles to owners at below market value
• Unrecorded write-offs of receivables or stock
• Transfer of trademarks, domains, software or other IP without proper valuation

The Danish Tax Agency may adjust values to market level and tax the difference as income or a hidden distribution. To avoid disputes, ensure that all asset transfers are documented, valued at arm’s length and properly reflected in the accounts and tax returns.

8. Incomplete deregistration from all relevant registers

It is not enough to close the CVR registration. Many businesses forget to deregister from specific schemes and registers, which can lead to continued obligations and correspondence.

Typical omissions:

• Employer registration (arbejdsgiverregistrering) and eIndkomst reporting
• VAT registration and any special schemes (e.g. import/export, MOSS/OSS)
• Environmental, sector-specific or industry licences
• NemID/MitID Erhverv roles and access rights

Prepare a checklist of all registrations and licences held by the company and close each of them systematically. Keep confirmations from the authorities for your records.

9. Not keeping documents after closure

Some owners dispose of accounting records and contracts immediately after closing the company. Under Danish rules, accounting material must generally be kept for at least five years after the end of the financial year, even if the company is closed.

If you cannot present documentation in case of a later tax audit or dispute, the authorities may estimate income and VAT, often to your disadvantage. Ensure that bookkeeping records, bank statements, invoices, contracts and payroll data are stored securely and remain accessible for the full retention period.

10. Choosing the wrong closure method

There are several ways to close a Danish company, including voluntary liquidation, solvent dissolution via declaration, and compulsory dissolution initiated by the authorities. Selecting the wrong method can lead to unnecessary costs, delays or even personal liability.

Risks include:

• Starting a simplified dissolution when there are still unresolved debts or disputes
• Allowing the company to be compulsorily dissolved due to missing accounts or reports
• Overlooking the impact on contracts, guarantees and ongoing projects

Before deciding, assess the company’s financial position, number of creditors, ongoing contracts and tax situation. In many cases, a planned voluntary liquidation with professional support is cheaper and safer than letting the company drift into compulsory dissolution.

How to minimise risks when closing a Danish business

The safest way to avoid these mistakes is to plan the closure early, prepare a detailed overview of assets, liabilities and employees, and coordinate the process across accounting, tax, legal and HR. A clear timeline, correct filings with Erhvervsstyrelsen and Skattestyrelsen, and proper documentation at each step significantly reduce the risk of unexpected tax bills, fines or personal liability.

Record-keeping and document retention requirements after business closure

Closing a business in Denmark does not mean you can immediately dispose of your accounting records and corporate documents. Danish law requires that books, vouchers and key company documents are kept for a defined period, even after deregistration from the CVR register. Failing to comply can lead to problems in the event of a tax audit or disputes with former employees, customers or suppliers.

How long must records be kept after closing a Danish business?

Under the Danish Bookkeeping Act (Bogføringsloven) and tax rules, most business records must be retained for at least 5 years from the end of the financial year to which they relate. This 5‑year period applies regardless of whether the company is an ApS, A/S, sole proprietorship, partnership or foreign‑owned entity with a Danish permanent establishment.

The retention period is calculated from the end of the relevant financial year, not from the date of closure or deregistration. If your last financial year is shortened due to liquidation, the 5‑year period still runs from the end of that final financial year.

Which documents must be retained?

As a rule, you must keep all documentation that supports the company’s financial reporting and tax position. This typically includes:

• General ledger, journals and trial balances
• Annual reports and financial statements, including notes and management statements
• Bank statements, cash records and reconciliation documents
• Sales invoices, credit notes and documentation of revenue
• Purchase invoices, expense receipts and supplier contracts
• VAT accounts, VAT returns and supporting calculations
• Corporate tax returns, tax computations and correspondence with the Danish Tax Agency (Skattestyrelsen)
• Payroll records, payslips, e‑Income reports, holiday pay calculations and pension contributions
• Documentation of fixed assets, depreciation schedules and disposals
• Loan agreements, shareholder agreements and board minutes relevant to financial decisions

In addition, you should keep documentation related to the closure itself, such as liquidation accounts, statements to the Danish Business Authority (Erhvervsstyrelsen), creditor notices and final settlement agreements.

Format and storage location

Records may be stored either physically or electronically, as long as they are complete, legible and can be presented to authorities without undue delay. If you store records electronically, you must ensure that:

• The data is backed up and protected against loss, alteration and unauthorised access
• The format remains readable for the entire retention period (for example, by using widely supported file formats)
• The structure of the bookkeeping system is preserved so that entries can be traced from source document to financial statement and vice versa

Records may be stored outside Denmark, but you must be able to provide access to them in Denmark on request from the tax authorities or other public bodies. If your bookkeeping system is cloud‑based, verify with the provider that access will be maintained after the company is closed.

Responsibility for records after closure

Even after deregistration, there must be a clearly designated person or entity responsible for keeping and presenting the company’s records. In practice, this is often:

• The liquidator in a formal liquidation
• The former owner of a sole proprietorship
• The board of directors or a specifically appointed records custodian in an ApS or A/S
• An external accountant or law firm, based on a written agreement

It is important to document who is responsible, where the records are stored and how they can be accessed. This information should be agreed and recorded before the company is finally dissolved.

Special considerations for payroll and employee records

Employee‑related documentation is particularly sensitive and must be stored in compliance with both bookkeeping rules and data protection regulations (GDPR). You should retain:

• Employment contracts and amendments
• Records of working hours where required by law or collective agreement
• Payslips, tax cards, e‑Income reports and ATP/pension contributions
• Holiday pay calculations and settlements, including payments to Feriekonto or private holiday funds

These records are necessary to handle potential claims for unpaid wages, holiday pay or pensions, and to document correct reporting to the Danish authorities.

Data protection and secure destruction

Once the statutory retention period has expired, records containing personal data should not be kept longer than necessary. When you are allowed to dispose of documents, they must be destroyed securely so that personal and confidential information cannot be reconstructed. This applies to both paper and electronic records.

How we can assist with record‑keeping after closure

We help business owners in Denmark plan and implement a compliant record‑keeping strategy for the period after closure. This includes identifying which documents must be kept, setting up secure digital or physical storage, defining responsibilities and preparing for potential tax audits. Proper document retention reduces the risk of penalties, disputes and unexpected questions from the Danish authorities long after your company has been closed.

Tax implications for shareholders and owners when a Danish company is liquidated

When a Danish company is liquidated, the tax consequences for shareholders and owners depend on the legal form of the business, the owner’s tax residence and whether the owner is an individual or another company. Proper planning of the liquidation process can significantly reduce the overall tax burden and avoid unexpected assessments from the Danish Tax Agency (Skattestyrelsen).

Distribution on liquidation: treated as dividend or capital gain

For Danish tax purposes, amounts paid to shareholders in connection with a liquidation are generally treated as a disposal of shares and taxed as capital gains, provided the liquidation is carried out as a formal liquidation and the company is finally dissolved. If the company is not properly liquidated and is instead distributing funds while still existing, distributions can be treated as dividends.

The distinction is important because dividend income and share gains are taxed differently for individuals, and different participation exemption rules apply for corporate shareholders.

Individual shareholders – tax on liquidation proceeds

For individuals tax resident in Denmark, the gain on shares in a Danish company (for example ApS or A/S) on liquidation is taxed under the rules for share income (aktieindkomst). The taxable gain is generally calculated as:

Liquidation proceeds (cash and fair market value of assets received) – tax basis of the shares

Share income is taxed at progressive rates. Current rates are:

• 27% on share income up to a certain annual threshold per person
• 42% on share income exceeding that threshold

The threshold is adjusted regularly, and married couples taxed jointly can effectively double the threshold by transferring unused allowance between spouses.

If the shareholder has realised both gains and losses on shares in the same income year, losses may reduce the taxable share income, subject to specific rules and limitations. Losses on unlisted shares may be offset differently than losses on listed shares, and correct classification is important when preparing the final tax return.

Corporate shareholders – participation exemption and tax-free liquidation

For Danish corporate shareholders (for example a holding ApS), gains on shares in subsidiary companies may be tax exempt under the participation exemption rules. As a general rule, gains on subsidiary shares and group shares are tax free for the corporate shareholder if:

• The Danish company holds at least 10% of the share capital in the subsidiary, and
• The subsidiary is tax resident in Denmark or in a country with which Denmark has a tax treaty or is an EU/EEA company covered by the EU Parent-Subsidiary Directive, and
• The shares are not held as trading stock by a financial institution or similar.

Where these conditions are met, liquidation proceeds received by the corporate shareholder are normally tax free. If the shareholding is below 10% or the conditions are not fulfilled, the gain may be taxable at the standard Danish corporate tax rate.

Corporate shareholders should also consider whether any write-downs or impairments previously recognised for accounting purposes have tax implications when the shares are finally disposed of in the liquidation.

Return of share capital and overpaid capital contributions

Part of the liquidation proceeds may represent a return of paid-in share capital and certain capital contributions. For tax purposes, this is usually taken into account in the calculation of the gain by comparing the total proceeds with the tax basis of the shares. If the liquidation proceeds do not exceed the tax basis, the shareholder may have no taxable gain and, in some cases, may realise a tax-deductible loss.

It is important to distinguish between formal reduction of share capital before liquidation and distributions made as part of the liquidation itself, as different withholding and reporting rules may apply.

Withholding tax on liquidation distributions to foreign shareholders

When a Danish company is liquidated and distributes funds to foreign shareholders, Danish withholding tax may apply. The key points are:

• Distributions that are considered dividends under Danish law may be subject to 27% Danish withholding tax.
• Under tax treaties and EU rules, the effective withholding tax rate can often be reduced, sometimes to 0%, if conditions are met and proper documentation is provided.
• If the distribution qualifies as a capital gain on shares rather than a dividend, Denmark may not levy withholding tax, but the foreign shareholder may be taxed in their country of residence.

Correct classification of the liquidation proceeds and timely filing of refund claims or relief-at-source documentation is crucial to avoid excessive withholding tax for foreign owners.

Final tax return and timing of taxation

For individual shareholders, the taxable gain is generally recognised in the income year in which the company is finally dissolved and the shareholder’s right to the liquidation proceeds is established. The gain must be reported in the personal tax return for that year under share income.

For corporate shareholders, the gain or loss is recognised in the income year in which the shares are considered disposed of for tax purposes, typically when the final liquidation resolution is implemented and the company is deregistered.

Because the liquidation process can span several months, it is important to coordinate the timing of distributions and the final dissolution with the shareholder’s tax year and any other planned transactions.

Debt forgiveness and shareholder loans

If, during liquidation, shareholder loans are written off or converted into equity without full repayment, this may have tax consequences for both the company and the shareholder:

• For individual shareholders, cancellation of a shareholder loan can in some cases be taxed as dividend income or salary, depending on the circumstances.
• For corporate shareholders, the tax treatment depends on whether the loan is considered equity-like and whether participation exemption rules apply.

Improper handling of shareholder loans is a frequent focus area in tax audits related to company closures.

Special considerations for cross-border owners

Shareholders who are not tax resident in Denmark, or who move in or out of Denmark around the time of liquidation, must consider both Danish rules and the rules in their home country. Denmark may apply exit taxation on unrealised gains for individuals who cease to be tax resident while holding significant share portfolios, and double taxation relief must be coordinated through tax treaties.

In cross-border situations, it is often necessary to obtain advance advice and, in some cases, advance rulings to ensure that the liquidation is structured in a tax-efficient way and that documentation is sufficient for both Danish and foreign tax authorities.

How professional support can help shareholders

Because the tax implications of liquidating a Danish company can be complex, shareholders and owners benefit from early planning. Professional support typically includes:

• Calculating expected gains or losses for each shareholder
• Assessing whether distributions will be treated as dividends or capital gains
• Applying participation exemption rules for corporate shareholders
• Optimising the timing of distributions and final dissolution
• Handling withholding tax and treaty relief for foreign owners
• Preparing the necessary documentation and reporting to the Danish Tax Agency

Careful preparation reduces the risk of unexpected tax bills, penalties and disputes with the authorities after the company has been closed.

Cross-border aspects: closing a Danish company with foreign owners or activities

Closing a Danish company with foreign owners, foreign directors or cross-border activities requires coordination between Danish rules and the regulations in other relevant countries. Proper planning helps avoid double taxation, unexpected liabilities and delays in the liquidation process.

Foreign shareholders and directors

When a Danish company (typically an ApS or A/S) has non-resident shareholders or board members, the formal closure procedure in Denmark is largely the same, but additional aspects must be considered:

• Shareholders and directors must be correctly registered in the Danish Business Register (CVR) before liquidation starts, otherwise the Danish Business Authority may request updates before processing filings.
• Documents for the general meeting (liquidation resolution, approval of final accounts) may need to be prepared in English and, if required by foreign banks or authorities, accompanied by sworn translations or apostilles.
• Non-resident shareholders may be subject to taxation in their country of residence on liquidation proceeds; double tax treaties between Denmark and the shareholder’s country must be checked to avoid double taxation.

Withholding tax on liquidation proceeds

Distributions to foreign shareholders in connection with liquidation can be treated as either dividends or capital gains, depending on the structure and the applicable double tax treaty. In many cases, Denmark levies 27% withholding tax on dividends paid to foreign shareholders, which may be reduced under a tax treaty or EU Parent-Subsidiary Directive (for qualifying EU/EEA corporate shareholders).

Correct classification of the final distribution is crucial. If the payment is treated as a dividend, the company may be required to withhold Danish tax and report it to the Danish Tax Agency (Skattestyrelsen). If it qualifies as a capital gain, the taxation usually takes place in the shareholder’s country of residence, and no Danish withholding tax is due. This assessment must be made before the final distribution is paid out.

Cross-border VAT and indirect taxes

If the Danish company has supplied goods or services to customers in other EU countries or outside the EU, the VAT position must be settled in all relevant jurisdictions before closure:

• Ensure that all Danish VAT returns are filed up to the final date of taxable activity, including any corrections for intra-Community supplies and acquisitions.
• Close any foreign VAT registrations (for example, in other EU member states where the company has a local VAT number) and file final VAT returns in those countries.
• Check whether any import VAT, customs duties or excise duties remain outstanding in Denmark or abroad, especially if the company has acted as importer of record.

Failure to deregister foreign VAT numbers or to file final returns can delay the liquidation and lead to penalties outside Denmark.

Permanent establishments and foreign branches

If the Danish company operates through a permanent establishment (PE) or branch in another country, the closure process must cover both the Danish entity and the foreign PE:

• Determine the closing date of the foreign PE and ensure that local corporate income tax returns are filed up to that date.
• Allocate profits, losses and assets between Denmark and the foreign PE according to transfer pricing and double tax treaty rules.
• Obtain tax clearance or confirmation from foreign tax authorities where required before distributing remaining assets to shareholders.

In Denmark, the final corporate income tax return must reflect the cessation of foreign activities and any exit taxation that may apply to assets moved out of Danish tax jurisdiction before closure.

Cross-border employees and social security

When a Danish company employs staff who work in other countries or cross-border (for example, commuters or remote workers), the employer obligations must be settled in each jurisdiction:

• Terminate employment contracts in line with Danish rules and, where applicable, local labour law in the country where the employee physically works.
• Settle outstanding salary, holiday pay, bonuses and pension contributions, including ATP and any foreign social security contributions.
• Close foreign payroll registrations and ensure that all final payroll reports and tax withholdings are correctly filed and paid.

In Denmark, the company must submit final eIncome (eIndkomst) reports and settle A-tax (withholding tax) and AM-bidrag (labour market contributions) for all employees, including those working abroad but taxed in Denmark.

Cross-border assets and bank accounts

Many Danish companies with international operations hold assets outside Denmark, such as foreign bank accounts, receivables, inventory or intellectual property rights. Before the company can be fully liquidated:

• Foreign bank accounts must be closed or transferred, and any remaining balances must be repatriated to Denmark or distributed directly to shareholders as part of the liquidation proceeds.
• Contracts with foreign customers, suppliers and partners must be terminated or assigned, taking into account local notice periods and legal requirements.
• Intellectual property (trademarks, domains, software rights) registered in other countries should be transferred, sold or cancelled, and the tax implications of such transfers must be assessed.

All cross-border transfers of assets should be documented at arm’s length value to comply with Danish transfer pricing rules and to avoid disputes with foreign tax authorities.

Double tax treaties and risk of double taxation

Denmark has an extensive network of double tax treaties that influence how profits, liquidation proceeds and capital gains are taxed when a Danish company with foreign owners or activities is closed. When planning the closure, it is important to:

• Identify all countries involved (residence of shareholders, location of branches, assets and customers).
• Review the relevant double tax treaties to determine which country has primary taxing rights over liquidation proceeds and final profits.
• Use available relief mechanisms (exemption or credit methods) to avoid double taxation for shareholders and the company.

In complex structures, timing the liquidation and distributions can significantly affect the overall tax burden, especially where participation exemption rules or minimum holding thresholds apply in the shareholder’s jurisdiction.

Compliance, documentation and communication with authorities

Cross-border closures typically involve more documentation and communication than purely domestic cases. To keep the process efficient:

• Maintain a clear timeline of key steps in Denmark and abroad (final operations, last invoices, last payroll, final VAT and tax returns, deregistrations).
• Prepare supporting documentation in English where possible, as this is widely accepted by Danish authorities and many foreign institutions.
• Coordinate with foreign advisers to ensure that filings in other countries are aligned with the Danish liquidation accounts and final tax returns.

Well-prepared documentation reduces the risk of questions from the Danish Business Authority, the Danish Tax Agency and foreign tax offices, and helps ensure that the company can be removed from the CVR register without unnecessary delays.

Checklist: documents and information needed to start the closure process in Denmark

Before you can formally start closing a business in Denmark, it is important to gather the key documents and information that Danish authorities, banks and advisers will require. Having everything ready at the outset helps avoid delays with the Danish Business Authority (Erhvervsstyrelsen), the Danish Tax Agency (Skattestyrelsen/SKAT) and other stakeholders.

Basic company identification

First, make sure you have all core identification data for the business:

• CVR number and full legal name of the company
• Registered address and any additional business locations
• Legal form (ApS, A/S, sole proprietorship, I/S, K/S, etc.)
• Articles of association and any shareholder agreements (for companies)
• Names and contact details of owners, board members and directors
• NemID/MitID Erhverv access details and information on who is authorised to sign digitally

Corporate decisions and legal documentation

For limited liability companies (ApS, A/S) and other registered entities, you must be able to document that the owners have decided to close the business:

• Minutes from the general meeting approving liquidation or dissolution
• Liquidation plan or closing statement, including proposed date of cessation
• Appointment details of the liquidator (if voluntary liquidation is chosen)
• Updated ownership structure, including any recent share transfers
• Any ongoing contracts, leases, franchise or licence agreements that must be terminated or transferred

Accounting records and financial overview

Authorities and advisers will expect a clear financial picture of the company up to the closing date. Prepare at least:

• Latest approved annual report and financial statements
• Up-to-date trial balance and general ledger up to the planned cessation date
• List of all assets (inventory, equipment, vehicles, real estate, intellectual property, goodwill)
• List of all liabilities (bank loans, trade payables, intra-group balances, guarantees)
• Bank statements for all business accounts
• Cash register reports and POS summaries, if relevant

Tax and VAT documentation

Closing a business in Denmark requires final settlement of all tax obligations. You will typically need:

• VAT registration details and VAT numbers used in Denmark and other EU countries
• VAT accounts and filed VAT returns for the current and previous periods
• Overview of outstanding VAT, including on fixed assets subject to adjustment rules
• Corporate income tax calculations and filed tax returns for the last years
• Preliminary tax assessments and any outstanding tax payments or refunds
• Documentation for tax losses carried forward and group contributions, if applicable
• Information on any withholding tax obligations (e.g. interest, royalties, dividends to foreign parties)

Payroll, employees and social contributions

If you have or recently had employees, you must be able to document all employment-related matters up to the closing date:

• List of all current and recently terminated employees, with CPR numbers and contact details
• Employment contracts and any collective agreements
• Overview of notice periods, agreed severance and termination dates
• Payroll records, payslips and eIndkomst (E-income) reports
• Holiday pay balances and documentation for payments to FerieKonto or private holiday schemes
• ATP contributions and pension scheme details, including outstanding payments
• Documentation of other staff benefits (company car, phone, stock options, bonus schemes)

Creditors, debt and other obligations

Before a Danish company can be finally closed, debts and obligations must be settled or formally handled. Prepare:

• Complete list of creditors (suppliers, banks, landlords, group companies, private lenders)
• Loan agreements, credit facilities and security documents (pledges, guarantees, mortgages)
• Lease and rental contracts, including termination terms and notice periods
• Outstanding invoices issued to customers and unpaid supplier invoices
• Information on any disputes, claims or ongoing legal cases
• Insurance policies and their cancellation or run-off terms

Assets, contracts and intellectual property

Authorities and owners must be able to see how assets are handled at closure, as this can have tax and legal consequences. Collect:

• Fixed asset register with acquisition values and depreciation
• Valuations or sales agreements for assets to be sold or transferred to owners
• Inventory lists and stock counts close to the closing date
• Details of trademarks, domains, software licences and other intellectual property
• Customer and supplier contracts, including termination or assignment documentation
• Documentation for intra-group transactions and transfer pricing, if relevant

Registrations with Danish authorities and third parties

To deregister correctly, you need an overview of all registrations and accounts linked to the business:

• CVR registration details and any registrations for VAT, payroll (E-income) and duties
• SE numbers or other special registrations (e.g. excise duties, import/export)
• Bank account details, including any separate tax or payroll accounts
• NemKonto information for the company
• Access details and contact information for digital mailboxes (Digital Post) and e-Boks
• Registrations with industry associations, chambers of commerce or professional bodies

Information needed for shareholders and owners

When a Danish company is liquidated, there may be tax consequences for shareholders and owners. To assess and document this, you should have:

• List of all shareholders or owners, with ownership percentages and acquisition dates
• Purchase prices and documentation for acquisition of shares or ownership interests
• History of capital increases, reductions and distributions (dividends, extraordinary payouts)
• Information on loans between company and owners, including balances and terms
• Tax residency of each owner and any double tax treaty considerations

Practical checklist to start the closure process

In practice, you will usually need at least the following to initiate the formal closure of a Danish business:

1. CVR number, legal form and updated company details
2. Decision of the owners to close the business, documented in minutes or a written resolution
3. Recent financial statements and an updated overview of assets and liabilities
4. Overview of tax, VAT and payroll obligations, including any outstanding amounts
5. List of employees, creditors and key contracts, with planned termination dates
6. NemID/MitID Erhverv access and confirmation of who can sign on behalf of the company
7. Contact details for the company’s accountant, lawyer and bank

Once these documents and pieces of information are collected, the actual deregistration with the Danish Business Authority and the Danish Tax Agency can usually be carried out more efficiently, with a lower risk of unexpected tax claims or delays in finalising the closure.

How can we help with the closing of a Danish company?

We will handle the implementation of all key steps for both companies and sole proprietorships. This process includes the following activities:

- Settlement of tax liabilities
It is important to settle all tax issues, including VAT, excise duties, salaries and other dues to the Danish state, before closing the company. You should also file reports for all periods up to the closing date to avoid late penalties, which can be as high as DKK 800. Also, don't forget to file a final report. This is necessary even if the amount is DKK 0 for the period.

- Filing the closing form
Officially closing a sole proprietorship or company in Denmark requires obtaining an official closing certificate, which may be needed in the future, for example by banks or the unemployment insurance fund.

- Correcting the advance declaration
In order for the tax to be calculated correctly and consequently paid, it is necessary to adjust the profit in the tax return after the company has closed.

- Verification of the company's tax account
Before ending the business, it is important to check the status of reports and payments on Skattekonto to make sure that all payments, such as VAT or A-skat, are ureluged.

- When closing a business, it is important to prepare a skatteregnskab and calculate profits and losses. In this process, a tax return should be prepared for the period from January 1 to the closing date. The profit and loss balance sheet should include all items that have been taken out of the company, such as machinery, cars or inventory. Oplysningskema must be declared in the year following the termination of operations, and the deadline for filing is July 1. Delay in filing the declaration results in a fine of 200 kr. for each day of delay, with a maximum penalty of 5,000 kr.

- Maintaining access to a company's digital mail after the company's operations end can be a challenge, as NemID is deactivated, with the loss of access to Digital Post. Regardless of this fact, messages may still arrive in the company's mailbox. In order to ensure that you can continue to use Digital Post after your business is shut down, you should properly configure access to Digital Post before closing your business. It's worth taking these steps to avoid post-closing communication problems.