Unlike other countries, where the BEPS initiative has been the driving force behind tax policy changes, the Danish tax system has faced greater domestic challenges. Perhaps the leading concern of taxpayers and practitioners in Denmark in recent years has been the state of the tax authority. The Danish Tax Administration (SKAT) is being dismantled after being hit by a series of scandals. It is known that the SKAT refund system was abused and an estimated DKK 12.3 billion ($1.9 billion) was siphoned off through fraudulent refund claims.
Normally the Danish authorities tax dividends at 27%, except in cases of double taxation where firms are entitled to refund what they have paid in Denmark. Companies made false claims to take advantage of the system. Director general Jesper Rønnow Simonsen resigned over the scandal.
As if this scandal was not bad enough on its own, the tax authorities have faced serious IT problems. These problems have held back tax collection and led to inflated property evaluations. The Danish government will replace SKAT with seven new tax agencies, five of which will be based outside of Copenhagen, and expand the new agencies' teams with a fresh intake of staff.
"The Danish tax authorities have gone through a scandalous season – you have the dividends scandal, where the authorities have paid out too much to people who were not entitled to it," said Arne Riis, senior partner at Accura. "There have been failures with tax collections because of IT problems for the last three years. A commission is investing what exactly has gone wrong."
Each of the new agencies will have its own head, who will be answerable to the tax minister. The aim is to improve the capabilities of the tax authorities, while reducing the risk of fraud and serious technical problems with collecting tax revenue going back three years. As this reorganisation goes ahead, SKAT is due to be fully replaced by July 2018.
Whether or not the reorganisation succeeds, and how this success can be measured, is an open question. However, law firms are glad to see the tax authorities reformed. Some tax specialists are optimistic that the reorganisation will produce the desired results. Others are concerned that the increased bureaucracy might just lead to new problems.
Over the same period, tax avoidance scandals like the Panama Papers have led to renewed focus on tax evasion and avoidance, though only a small number of Danish companies and individuals were implicated in the case. Nevertheless, the scandal raised public awareness of tax avoidance and prompted calls for greater scrutiny.
Even though Danish tax law is already largely compliant with the new international standards set by the OECD and the EU, the reorganisation of the tax administration is expected to create more work for tax professionals as normal tax collection is likely to resume and the new agencies will be expected to enforce the standards rigorously.
This is necessary if the tax authorities are going to shake off the scandals of the past and satisfy the public calls for reform. As a result, the market may well see a rise in demand for tax advice in compliance and planning. This could be followed by an increase in the number of tax disputes and this would mean more work for tax litigators in the years ahead.
Bjørnholm Law I/S
DK-2900 Copenhagen, Hellerup
Tel: +45 45 17 42 00
Tel: +45 30 93 71 93
Nikolaj Bjørnholm is an experienced litigator and has appeared before the Supreme Court more than 15 times since 2000 with an excellent track record.
Tel: +45 20 12 06 90
Bodil Tolstrup is specialized in tax controversy within all areas of tax. She has represented clients varying from individuals and small independent businesses to venture funds and labor-unions.
Bjørnholm Law was founded in March 2016 with focus on tax controversy and international taxation. The firm is currently involved in disputes relating to inter alia transfer pricing, beneficial ownership, hydro carbons and GAAR. The two partners of the firm are well known and very experienced in representing the clients before the tax authorities, competent authorities and the courts.
Ernst & Young P/S
Osvald Helmuths Vej 4
Tel: +45 7323 3000
Regional Tax Leader
Christin Erichsen Bøsterud
Tel: +47 977 78 314
Country Tax Leader
Tel: +45 25 29 37 80
Tel: + 45 73 23 33 10
Business Tax Services
Hans Henrik Bonde Eriksen
Tel: +45 2529 4049
Global Compliance and Reporting
Tel: +45 2529 5911
Peter K. Svendsen
Tel: +45 25 29 35 45
International Tax Services – Core
Vicki F. Jørgensen
Tel: +45 5158 2632
Carina Marie G. Korsgaard Tel: +45 2529 3764
Tel: +45 5158 2649
People Advisory Services
Morten S Dalsgaard
Tel: +45 5158 2771
|Corporate Income Tax||22%|
|Capital Gains Tax||22%|
|Net Operating Losses (years)|
|Royalties from, for example, patents, know-how||22%||B|
A) The 22% rate applies to payments on or after March 1 2015.
B) The 22% rate applies to payments on or after March 1 2015. The rate is 0% for royalties paid for copyrights of literary, artistic or scientific works, including cinematographic films, and for the use of, or the right to use, industrial, commercial or scientific equipment. In addition, the rate may be reduced or eliminated if certain conditions are met under the European Union (EU) Interest-Royalty Directive or a double tax treaty entered into by Denmark.
C) A Danish branch office or a tax-transparent entity may be recharacterised as a Danish tax-resident company if the entity is controlled by owners resident in one or more foreign countries, the Faroe Islands, or Greenland and if either of the following circumstances exists:
Arne Riis is the head of tax at Accura. He has more than 15 years of experience in M&A tax, structuring, international, corporate and financial tax. The firm re-established its tax practice in 2015 and has rapidly gained a presence in the market. Accura offers clients a wide range of tax services and focuses on key areas such as real estate and international tax.
In just a couple of years, Accura has developed a strong reputation in M&A tax for private equity and corporate clients. One client said: "I am very happy with the tax advice provided by Arne Riis from Accura, who shows very high standards in his expertise. I do not use any other lawyer for tax advice."
With more than 18 years of experience in taxation, Ida Gert Jensen is the head of tax and VAT at BDO Denmark. The tax team advises and assists companies on a range of tax and VAT issues related to financial transactions, such as tax planning, real estate, foreign investment, incentive schemes and restructuring. The Danish member firm mainly focuses on VAT and other indirect tax matters. BDO International has member firms with 1,400 offices in 154 countries.
Anders Oreby Hansen is the head of the tax division at Bech-Bruun, Taxand Denmark. He has extensive expertise in Danish and international tax law. Hansen has advised both multinational clients on tax strategy and dispute resolution.
Other significant partners include chief economist Jørgen Dreyer Hemmsen and tax litigation team leader Kaspar Bastian. The team is a mix of lawyers and economists, who have expertise in the full range of tax services. This scope includes transactions, transfer pricing, international tax and VAT. Indirect tax is an area of speciality for the firm.
Bech-Bruun offers clients advice and assistance in such areas as M&A, financial instruments, restructuring and incentives. The practice has a broad range of domestic clients from various industries. This includes banks and leading financial institutions, energy companies and telecommunications businesses.
Nikolaj Bjørnholm founded Bjørnholm Law after leaving Plesner in 2016. He has more than 20 years of tax experience. He specialises in tax disputes, litigation and controversy work. Held in high regard by clients and firms alike, Bjørnholm has been rated as one of the best tax lawyers in Denmark.
Another distinguished figure at the firm is partner Bodil Tolstrup, who specialises in tax controversy and represents clients ranging from independent businesses to trade unions. The practice has been able to secure prominent clients on account of its outstanding record in litigation before the Danish courts. These cases include negotiations and settlements at the tax tribunal.
One client said: "Bjørnholm Law has the right balance between tax expertise, experience and pragmatism, with quite a good understanding of the business."
Søren Lehmann Nielsen and Erik Banner-Voigt are co-heads of the tax practice at Bruun & Hjejle. The firm has a strong focus on complex transactional questions and tax litigation. This niche extends to acquisition structures, due diligence, debt structuring, transfer pricing, corporate tax and VAT.
Banner-Voigt is a well-known tax specialist with impressive expertise in alternative investments, M&A, private equity and venture capital funds. Lehmann Nielsen advises clients on a range of tax matters, but is particularly strong in dispute resolution. His clients range from telecommunications companies and financial institutions to cooperatives.
Recent additions to the team include attorney Julie Levin and consultant Christoffer Bennike Rønning. The firm's client base is composed of banks, private-equity funds, real estate companies, pension funds and multinational corporations.
Jakob Bundgaard is the head of tax at CORIT Advisory. The firm is fully independent and offers a wide range of advice, with strengths in complex cases and international tax matters. The practice increasingly advises multinational companies from key sectors.
Another prominent partner is Katja Dyppel Weber, one of the leading experts on derivatives and tax matters, who has been engaged by banks in major tax disputes. Recently, CORIT Advisory conducted a study on aggressive tax planning for the European Commission. Bundgaard is a permanent member of the Danish tax law council.
"CORIT [professionals] love what they do and it shows both in the technical level of their advice and the desire to deliver an outstanding service every time," said one client. "They are very flexible and nimble and can adapt to the specific needs of any company in a specific case. And it is obviously always nice not to have to deal with all the compliance hassle and formalities."
Niels Josephsen is the head of tax at Deloitte Denmark. He has a great deal of experience in corporate tax, international tax and strategy. The tax practice consists of more than 230 professionals, including 31 partners, and advises clients in key areas such as international tax, transfer pricing and VAT.
This year Deloitte established a new desk for initial public offerings and incentive-related programmes. New partner Anja Andersen leads the team of incentive specialists. The firm brings together experience and insight with industry knowledge. As part of the Nordic corporation network, Deloitte has established a unique offering towards pan-Scandinavian clientele. This includes major companies listed on the stock exchange.
Other important partners include Søren Reinhold Andersen, who leads the business tax team, Thomas Svane Jensen, the head of indirect tax, and Asger Mosegaard Kelstrup, who heads the TP unit.
Partner Ole Bendixen is the head of tax at EY in Denmark. He has expertise in such areas as international tax, transfer pricing, restructuring, corporate law, M&A, strategic planning and due diligence. The tax practice offers the full spectrum of services in corporate tax, indirect tax and litigation.
Another distinguished EY partner is Vicki From Jørgensen. With more than eight years of experience, Jørgensen has amassed a wealth of knowledge in tax affairs, especially strategy, controversy, policy, risk management and cross-border mergers. She previously worked for the Danish tax authorities.
Jakob Skaadstrup Andersen is the head of tax at Gorrissen Federspiel. He specialises in tax, compliance matters and corporate social responsibility. Andersen is a member of the International Fiscal Association, the Danish Tax Lawyers' Association and the International Bar Association.
Gorrissen Federspiel is a corporate law firm with an international outlook and assists clients across the Nordic countries and overseas. The firm brings together tax experience and industry knowledge to tackle problems in EU tax law and corporate tax, M&A, restructuring, real estate, banking and capital markets.
Partner Niclas Holst Sonne is the head of tax at Horten. He joined the firm in 2013 and the practice has expanded continuously since then. The tax team is best known for its expertise in M&A, corporate tax structuring, cross-border taxation, real estate planning and reorganisations.
Other distinguished team members include Ulrik Krogh Holst and Anne Becker-Christensen. Holst provides tax advice to clients on setting up businesses in Denmark, whether it be structuring or VAT. Becker-Christensen specialises in corporate tax law and cross-border tax matters. She has been involved in numerous transactions, acquisitions and reorganisations.
With a strong financial and corporate base, Horten's clients range from real estate funds and insurance companies to venture capital and asset management firms. This includes Danish businesses and multinationals.
Managing partner Ole Schmidt is the head of tax at KPMG Acor Tax. He specialises in domestic and international tax law, private equity, structuring and planning. Schmidt has direct experience of the oil and gas industry, providing advice on carbon tax.
Founded in 2014 after the former KPMG member firm merged with EY, the young tax practice consists of 17 partners and 80 other professionals. Other key tax partners include Ria Falk, Claus Bohn Jespersen, Jacob Alstrup Lie, Martin Reng, Flemming Mortensen and Susanne Dybdahl. The team provides support to clients on a variety of tax concerns, including M&A, double taxation, controversy, incentive programmes and VAT.
KPMG Acor Tax serves a broad spectrum of clients, such as financial institutions, medical companies, packaging businesses and wind turbine producers. The firm has established an impressive portfolio of corporate clients, including many OMX Copenhagen 20 index companies, giving it a strong position in the market.
As a leading law firm in Denmark, Kromann Reumert advises clients on tax planning, international tax, dispute resolution, VAT and litigation. Managing partner Arne Møllin Ottosen oversees the practice and specialises in corporate law, foundations and trusts, as well as the tax-related aspects of real estate, logistics and finance. Kromann Reumert has the capacity to provide tax services on a comprehensive range of issues, such as business restructuring, succession planning, joint ventures and reorganisation.
The tax group at DLA Piper is headed by Artur Bugsgang, who has impressive expertise in tax and company law, VAT and other indirect taxes. Originally known as LETT Law Firm, the practice underwent a rebrand in 2017 as part of joining DLA Piper. The firm brought with it 150 lawyers based in Copenhagen and Aarhus.
The tax team advises and supports high-net-worth individuals, corporates and the Ministry of Taxation with matters concerning criminal tax law, custom duties, VAT, direct and indirect tax. Over the years, the firm has served such companies as Nykredit and Volvo. The team assists clients with M&A, capital injections, reorganisations and the sale and purchase of companies.
Attorney Michael Amstrup is a key partner at the Lundgrens tax practice. With more than 20 years of experience, Amstrup specialises in advice on Danish tax law, criminal tax law and litigation. He works closely with fellow partner Mario Fernandez, who specialises in indirect tax, and director Malene Overgaard, who specialises in tax-exempt restructuring.
The team of tax professionals takes a specialised approach to tax matters, such as direct and indirect tax, transactions and VAT. The range of services extends to corporate and commercial tax, data protection, arbitration and intellectual property rights. Key focus areas include M&A, real estate, construction, insurance, life sciences, capital markets and entertainment.
Hans Severin Hansen leads the tax group at Plesner. Hansen is widely regarded as one of the best litigators in Denmark. The team offers the full range of tax services for a variety of industries, including M&A, cross-border structuring and reorganisations.
Other distinguished partners include Lasse Esbjerg Christensen and Tom Kári Kristjánsson. The two of them play a key role in the team as it takes on cases before the courts, including the European Court of Justice and the Danish National Tax Tribunal. The firm has a strong reputation in direct and indirect tax law. It has also been involved in major M&A deals this year. Plesner's focus areas include estate planning, incentives and capital markets.
"We are very happy with the service we have received from Plesner. I would and have recommended them in the past," said one client. "We exclusively use Plesner for controversy and tax legal advice in Denmark."
Director Jan Huusmann is the leader of PwC's tax department. He sits on the company's board and has experience covering indirect tax consulting, customs and VAT. The practice offers a full suite of services, including cross-border transactions, audit support, transfer pricing and dispute resolution. The firm has 16 offices in Denmark, extending its reach across the country. The firm's clientele ranges from Danish businesses and public institutions to high-net-worth individuals and multinational companies in a variety of industries.
Tax litigator Eduardo Vistisen founded Vistisen Tax Attorneys as a boutique law firm. With an impressive track record in court, Vistisen offers clients a specialist service in litigation and his expertise covers transfer pricing, tax audits, controversy, corporate tax and VAT.
Vistisen has a 75% success rate before the Danish tax tribunal. He is a member of the Danish Fiscal Association and the International Fiscal Association, as well as chairman of the Young Tax Chapter.