What SKAT Expects From a Small ApS

Running a small private limited company, or ApS, in Denmark comes with a set of responsibilities. The Danish Tax Agency, SKAT, and other authorities have clear expectations for how you manage your company's finances and reporting. This is not as complicated as it might seem. It is mostly about knowing your deadlines and what you need to report.

This guide breaks down the main obligations. We will cover corporate tax, VAT, employee taxes, the annual report, and how you, the owner, get paid. Understanding these duties is the foundation of a compliant and healthy business.

Corporate Tax (Selskabsskat)

Every Danish ApS is required to pay corporate tax on its annual profits. The current rate is 22%. This tax is calculated on your company's taxable income, which is your revenue minus your eligible business expenses.

Your company's financial year does not have to follow the calendar year. You choose your first financial year when you set up the company. It can be 12 months, or shorter or longer for the first year. You file one corporate tax return per financial year.

The process involves two main steps. First, you pay your expected tax for the year in two voluntary instalments. SKAT will send you a reminder about these payments via your company's e-Boks. If you do not pay these, you will pay a surcharge on your final tax bill. Second, after your financial year ends, your bookkeeper or accountant prepares your final tax return. This must be submitted no later than six months after your financial year-end. If you owe more tax, you pay the remaining amount. If you overpaid, SKAT refunds the difference.

Key Dates for Corporate Tax

• Voluntary Payments: Typically March 20th and November 20th during your financial year.
• Tax Return Deadline: Six months after your financial year concludes.

VAT (Moms)

Value Added Tax, or moms in Danish, is a consumption tax. It is separate from your corporate income tax. Most businesses in Denmark must register for VAT once their revenue exceeds DKK 50,000 in a 12-month period. Once registered, you must add 25% VAT to your sales within Denmark and the EU.

You also get to deduct the VAT that you pay on your own business expenses. This is called input VAT (købsmoms). The difference between the VAT you collect (output VAT) and the VAT you pay (input VAT) is what you owe to SKAT.

VAT is reported on an ongoing basis, not just once a year. For most new and small companies, this happens quarterly. You calculate how much VAT you have collected and paid, and you report the net amount online via SKAT's portal, TastSelv Erhverv. The deadline is usually the first day of the third month after the quarter ends. For example, VAT for Q1 (January-March) is due on June 1st.

Employee Taxes (A-skat & AM-bidrag)

If your ApS has employees, including yourself if you draw a regular salary, you have another set of obligations. You must withhold tax from their paycheques. This includes A-skat (income tax) and AM-bidrag (labour market contribution, which is 8%).

Your company acts as a collection agent for SKAT. You withhold the tax and then pay it directly to the tax authorities on behalf of your employees. This is done monthly. You must report the total salary paid and the amount of tax withheld for each employee. These payments are made via your company's Skattekontoen.

It is critical to handle this correctly. Failing to withhold and pay employee taxes is taken very seriously by the authorities.

The Annual Report (Årsrapport)

This is a common point of confusion. Your tax return goes to SKAT. Your annual report goes to the Danish Business Authority (Erhvervsstyrelsen). They are two separate obligations.

The annual report is a public document that provides a transparent overview of your company's financial health. It includes your income statement, balance sheet, and notes explaining the numbers. For small companies, the requirements are simplified, but the report must still be prepared according to Danish accounting law.

Like the tax return, the annual report is due six months after your financial year ends. Most companies get their accountant to prepare it. Once it is ready, it is submitted digitally to the Erhvervsstyrelsen. Missing this deadline can result in fines and, eventually, forced dissolution of your company.

Transfer Pricing

If your ApS conducts transactions with related parties, you need to be aware of transfer pricing rules. A related party could be you as the owner, another company you own, or a close family member. The rule is simple in principle: all transactions must happen at "arm's length." This means the price and terms must be the same as if the transaction were between two independent companies.

For example, if your ApS buys services from another company you own abroad, the price must be a fair market price. You cannot set an artificially high price to move profits out of Denmark. For small companies, the documentation requirement is less strict, but you must still be able to explain and justify your pricing if SKAT asks.

Your Skattekontoen (Tax Account)

Your Skattekontoen is a central account that manages all your payments with SKAT. Think of it as a current account for your taxes. When you need to pay VAT, corporate tax, or employee taxes, you transfer the money to this account. When SKAT owes you a refund, it will appear here.

You can access your Skattekontoen through TastSelv Erhverv. It gives you a real-time overview of your balances, payments, and any interest charges. It is a useful tool for staying on top of your obligations.

Owner's Tax: Salary vs. Dividend

Finally, how do you get paid? As the owner of an ApS, your personal finances are separate from the company's. You cannot just take money out of the business account. You have two main options: salary or dividends.

Choosing between salary and dividends depends on your personal financial situation and the company's profitability. Many owners use a combination of both. Taking a salary up to a certain level is often more tax-efficient than only paying out dividends. It is a good idea to discuss this with an accountant to find the right strategy for you.