As of 1 January 2021 a new employee share scheme applies. This new employee scheme entails that certain new and small companies can award employees with shares, options and warrants up to 50% of the employee's annual salary while the employee will be subject to taxation as share income (up to 42% taxation) instead of personal income (up to approx. 55% taxation).
Taxation / VAT
Tax and VAT rules affecting Alternative Investment Funds (AIFs) or the AIF’s managers or investors.
On 21 August 2020, the Danish Ministry of Taxation published for consultation a draft proposal according to which previously adopted amendments to the Danish Tax Assessment Act concerning the tax treatment of equity compensation to employees in “start-ups” will enter into force on 1 January 2021.Danish RegulationVenture Capital
Entry into Force: Guidance Signal Excluding Certain Alternative Investment Funds from VAT Exemption on Management Fees
On 7 May 2020, a guidance signal which excludes certain alternative investment funds from VAT exemption on management fees entered into force.Danish RegulationManagement Remuneration
Due to the COVID-19 crisis, the European Commission has put forward a proposal for a directive that will defer certain time limits of DAC6, the EU directive regarding mandatory reporting in relation to arrangements with cross-border implications.ComplianceDAC6
With effect of January 1st, 2020 the Danish tax rule on “hybrid entities” was amended. Going forward a Danish transparent entity (e.g. K/S) may be reclassified and thereby considered opaque for Danish tax purposes.
Amendments to the Danish Tax Assessment Act and the Danish Act on Taxation of Capital Gains on Shares are Adopted
The amendment act entered into force on 1 January 2020. According to the amendment act, carried interest is taxable as personal income not only where the carried interest originates from returns on shares but also where the carried interest originates from other sources of income.Management Remuneration
Guidance Signal Excluding Certain Alternative Investment Funds from VAT Exemption on Management Fees is Adopted by the Danish Tax Agency
On 7 November 2019 the Danish Tax Agency presented its guidance signal concerning the rules on VAT exemption for management fees for management of investment undertakings.Danish RegulationManagement Remuneration
On 6 November 2019 the Danish government presented its proposal to transpose the EU directive regarding mandatory reporting in relation to arrangements with cross-border implications (“DAC6”) into Danish law.ComplianceDAC6Disclosure Requirements
The Danish Government has presented a proposal for an amendment of various acts, including the Danish Tax Assessment Act and the Danish Act on Taxation of Capital Gains on Shares.Management Remuneration
DAC6, the new EU directive regarding mandatory reporting in relation to arrangements with cross-border implications DAC6, will increase reporting requirements for arrangements that have cross-border implications.ComplianceDAC6Disclosure Requirements
On 8 March 2019, the Danish Tax Agency published a draft guidance signal for public hearing. If implemented, the guidance signal will exclude certain alternative investment funds from VAT exemption on management fees.Danish RegulationManagement Remuneration
The CJEU judgments will likely have a big impact on international group structures and will also contribute to the interpretation of the anti-abuse principles of EU law and the "beneficial owner" concept.Beneficial OwnershipDanish Regulation
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