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Cost of Establishing a New APS Company

FEE PRICES

  1. The government fee is 670 DKK, and it does not include VAT.
  2. The fee paid to the lawyer is about 1,295 DKK, and it includes VAT.
  3. A specialist company can also be hired to assist in creating a new ApS company, with fees that depend on the range of procedures and services required, as they vary based on the needs and situation of the client.

THE INITIAL CAPITAL IS TRANSFERRED TO THE COMPANY AFTER REGISTRATION

To register a Danish private limited company (ApS), an initial capital of DKK 20,000 must be transferred to the lawyer's bank account for verification. The lawyer's fee (about DKK 1,295, including VAT) and the government fee (DKK 670) will be deducted from the initial equity, and the remaining amount of approximately DKK 37,711.25 will be transferred to the new ApS company's bank account once it is opened. The new ApS company must have its own bank account.

Mandatory Danish registration fees and government charges

When you establish a new ApS (Anpartsselskab) in Denmark, several mandatory registration fees and government charges apply. These are paid primarily to the Danish Business Authority (Erhvervsstyrelsen) and, depending on your situation, to other public authorities. Understanding these costs in advance makes it easier to budget the total price of setting up your company.

Company registration with the Danish Business Authority

The core mandatory fee is the registration fee for incorporating your ApS in the Danish Central Business Register (CVR). This fee is charged by the Danish Business Authority when you submit your formation documents digitally via Virk.dk.

For a standard online incorporation of a private limited company (ApS), you should expect a one‑time government registration fee in the range of approximately DKK 600–700. The exact amount is set administratively and is subject to adjustment, but it is a fixed fee per incorporation and does not depend on the size of your share capital.

If you choose to register through a professional formation agent or law firm, they will usually collect this state fee from you and pay it on your behalf as part of their service package. In that case, the fee will typically be included in their invoice as a separate disbursement item.

Registration of beneficial owners (UBO)

All Danish companies, including ApS, must register their ultimate beneficial owners (UBO) with the Danish Business Authority. The filing itself does not carry an additional government fee when done online together with the incorporation, but it is a mandatory step. Failure to register or update beneficial ownership information can lead to enforcement measures and fines, so it should be treated as a compliance obligation with potential cost consequences if ignored.

CVR number and basic registrations

Issuing a CVR number (the company’s business registration number) is part of the incorporation process and is covered by the same incorporation fee. There is no separate government charge for obtaining the CVR number, registering the company’s business address, or registering the company’s official email (digital mailbox) with public authorities.

VAT and employer registrations

Many new ApS companies must register for Danish VAT (moms) and, if they have employees, as an employer for payroll tax and labour market contributions. These registrations are done through TastSelv Erhverv and related online systems.

There is no direct government fee for:

However, you should factor in indirect costs such as accounting or payroll assistance to ensure correct and timely filings, as late or incorrect registrations can result in penalties and interest charges from the Danish Tax Agency (Skattestyrelsen).

Digital mailbox and NemID/MitID Erhverv

All Danish companies must have a digital mailbox and use NemID/MitID Erhverv to communicate with public authorities. The creation of the digital mailbox itself does not involve a government fee, but there may be minor costs related to obtaining and managing MitID Erhverv through your bank or identity provider, as well as internal administrative time to set it up correctly.

Possible fines and penalty charges

While not part of the initial registration fee, it is important to be aware of potential government charges that arise if you do not meet your statutory obligations. Examples include:

These amounts can quickly exceed the original incorporation fee, so timely compliance is a key cost‑control factor when starting an ApS.

Summary of mandatory public‑sector costs

In practice, the only direct and unavoidable government cash outlay at the moment of incorporation is the Danish Business Authority’s registration fee for creating the ApS and issuing the CVR number. VAT, employer and tax registrations do not carry separate state fees, but they do create ongoing compliance duties with potential penalty costs if not handled correctly. When planning the total cost of establishing your ApS, you should therefore combine the one‑off registration fee with a realistic estimate of the compliance resources needed to stay fully aligned with Danish corporate and tax regulations.

Required minimum share capital for an ApS and practical funding options

In Denmark, the required minimum share capital for a private limited company (ApS) is DKK 40,000. This amount must be fully subscribed on incorporation, but it does not have to be paid in cash only, and it does not have to remain “frozen” in a bank account after registration. The capital is the company’s equity and can be used for normal business expenses once the company has been registered.

Cash contribution vs. non-cash (in-kind) contribution

You can establish an ApS with:

In practice, most small and medium-sized businesses choose a cash contribution because it is faster, cheaper and involves less documentation than an in-kind contribution.

How much capital should you actually start with?

While DKK 40,000 is the legal minimum, it is often not sufficient for a realistic startup budget. You should consider:

Many founders choose a share capital of DKK 50,000–100,000 to give the company a healthier equity position and to make it easier to obtain credit, leases or supplier terms.

Practical funding options for the share capital

The law only requires that the share capital is paid in and properly documented. It does not require that the money comes from the founders’ personal savings. Common funding options include:

Bank account and documentation of paid-in capital

To register an ApS, you must document that the share capital has been fully paid in. This is usually done by:

After the Danish Business Authority (Erhvervsstyrelsen) has registered the company, the capital account is converted into a normal business account. From that point, the company can freely use the funds for business-related expenses.

Using the share capital after registration

Once the ApS is registered, the share capital is part of the company’s equity and can be spent on:

You must, however, always ensure that the company remains solvent and that the management complies with the Danish capital loss rules. If the equity is reduced to less than half of the registered share capital, the management must prepare a balance sheet and, if necessary, take measures such as capital increase, restructuring or liquidation.

Grants, soft funding and alternative financing

Public grants and innovation programmes in Denmark typically cannot be used directly as paid-in share capital, because they are paid to the company after it has been established. However, they can indirectly support your equity position by reducing early-stage costs and improving liquidity. Common options include:

These instruments do not replace the legal requirement to pay in at least DKK 40,000 in share capital, but they can help you avoid rapid depletion of equity in the first year.

Planning your capital structure from day one

When establishing an ApS, it is important to plan not only how to reach the minimum DKK 40,000, but also how the capital structure will support your growth strategy. Key questions include:

A well-planned share capital and funding structure will make it easier to meet Danish legal requirements, pass bank and investor due diligence, and avoid early financial stress in your new ApS.

One-time formation costs vs. ongoing annual compliance costs

When you establish a Danish ApS, it is important to distinguish clearly between one-time formation costs and the recurring annual compliance costs that you will face as long as the company exists. Understanding this difference helps you budget realistically and avoid cash flow surprises in the first years.

One-time formation costs are the expenses directly linked to creating the company and getting it ready to operate. These typically include the mandatory registration fee to the Danish Business Authority for setting up the ApS, drafting of the articles of association and the memorandum of association, and any professional assistance with the incorporation process. If you use a lawyer, accountant or formation agent, you will usually pay a fixed package price for preparing the documents, submitting the online registration and advising on share capital, ownership structure and management. If you need translations, notarisation or apostille for foreign owners, these are also one-off costs connected to the initial setup.

In addition to the formal registration, there are other startup costs that are incurred only once or very rarely. Examples are fees for registering a company name or trademark, initial legal review of standard contracts, and the first-time setup of accounting software and internal procedures. Opening a business bank account may involve a one-time onboarding fee, especially if there are foreign shareholders or cross-border activities. These costs are part of getting the ApS operational but do not repeat every year in the same form.

Ongoing annual compliance costs are different. They relate to the legal and tax obligations that apply to every ApS throughout its lifetime. The core recurring item is the preparation and filing of the annual report to the Danish Business Authority. Even though the public filing itself does not carry a government fee, most ApS companies pay an accountant or auditor to prepare the annual financial statements in accordance with the Danish Financial Statements Act. If your company is large enough to require a statutory audit, you will also have annual audit fees on top of accounting fees.

Tax compliance is another major source of recurring costs. Every year, the company must file a corporate tax return with the Danish Tax Agency and pay corporate income tax at the applicable rate on its taxable profits. Many companies engage an accountant or tax adviser to prepare the tax computation, optimise deductions and handle communication with the authorities. If the ApS is registered for VAT, you must submit VAT returns monthly, quarterly or half-yearly depending on turnover, which usually requires ongoing bookkeeping and periodic review by an accountant. If you have employees, you also need to handle payroll, labour market contributions and reporting to the eIncome system on a continuous basis.

There are also smaller but regular compliance-related expenses that should be included in your annual budget. These can include subscriptions for accounting and payroll software, secure digital signature solutions, data protection and archiving tools, as well as fees for maintaining any industry-specific licences or registrations. If you use a professional board member or external director, their remuneration is a recurring governance cost linked to running the ApS in a compliant and controlled manner.

From a planning perspective, it is useful to think of formation costs as an investment that occurs around the time of incorporation, while annual compliance costs are part of the fixed overhead of operating a Danish limited liability company. Formation costs are typically higher in the first year because you pay for legal structuring, initial advice and setup work. In the following years, your budget will be dominated by the predictable cycle of bookkeeping, annual accounts, tax returns and any audit requirements. When preparing your financial plan, it is therefore advisable to separate these two categories clearly and ensure that the company has sufficient liquidity not only to cover the one-time expenses of starting the ApS, but also the ongoing compliance costs that will arise every year.

Cost of using a lawyer, accountant or formation agent vs. doing it yourself

When you establish a Danish ApS, you can either handle the formation and registrations yourself or pay a lawyer, accountant or formation agent to do it for you. The best option depends on your budget, your experience with Danish corporate and tax rules, and how much time you can realistically spend on administration.

Typical costs of professional assistance

Professional fees vary widely depending on the scope of services and the complexity of your situation (for example, whether there are several shareholders, foreign owners or special shareholder agreements). As a general indication:

These amounts are in addition to mandatory state fees for company registration and any bank charges for opening a corporate account.

What you get when you pay a professional

Using a lawyer, accountant or formation agent can significantly reduce the risk of errors and delays. Typical services include:

For many foreign owners, an additional benefit is support in English and help communicating with Danish authorities and banks.

Costs and risks of doing it yourself

Handling the formation yourself can reduce direct cash outlay, but it requires time and a good understanding of Danish rules. If you do everything on your own, your direct costs are mainly:

You must prepare and file all documents through the online systems of the Danish Business Authority and the Danish Tax Agency (Skattestyrelsen). Common mistakes when doing it yourself include:

These errors can be costly to correct and may delay the time until you can issue invoices or pay out salaries.

Time investment vs. professional fees

For a straightforward ApS with one or two owners, no special share classes and simple activities, a person familiar with Danish digital self-service can often complete the formation and registrations within a few hours spread over several days. However, if you are new to the Danish system, you should realistically expect to spend significantly more time on:

When you pay a professional, you are effectively buying time and reducing the risk that you miss a critical step. For many founders, the value of starting operations earlier and avoiding administrative stress outweighs the formation fee.

When professional help is strongly recommended

While it is possible to form an ApS on your own, professional assistance is particularly advisable when:

In these situations, the cost of a lawyer or accountant is usually modest compared to the potential tax and legal consequences of getting things wrong.

Combining DIY with targeted professional support

Many founders choose a hybrid approach to control costs. For example, you can:

This approach keeps formation costs lower while still giving you professional quality control on the most critical points.

Long-term impact on compliance costs

The decision between doing it yourself and using professionals at the formation stage also affects your ongoing costs. A well-structured setup from day one usually leads to:

Conversely, if the company is formed with weak documentation or unclear agreements between owners, you may later face higher legal and accounting costs to correct or restructure the setup.

In summary, forming an ApS yourself can minimise direct cash expenses, but using a lawyer, accountant or formation agent often reduces risk, saves time and can lower your total cost over the life of the company. The optimal solution depends on the complexity of your business and how comfortable you are with Danish corporate, tax and accounting rules.

Bank account setup costs and typical banking requirements for ApS companies

Opening a Danish business bank account is a key step in establishing an ApS and in practice it is often one of the most time‑consuming parts of the process. Danish banks are subject to strict anti‑money laundering and “know your customer” (KYC) rules, which means they will carefully review the company, its owners and its business model before approving an account.

Typical costs of opening a business bank account for an ApS

Most Danish banks charge a one‑off onboarding or establishment fee for new corporate customers. For a standard ApS this is typically in the range of DKK 1,000–3,000, depending on the bank’s risk assessment and whether there are foreign owners or complex structures involved. Some banks may charge higher fees for non‑resident owners or if enhanced due diligence is required.

In addition to the setup fee, you should expect ongoing monthly account fees. For a basic business account package for an ApS, common price levels are:

Many banks also require a minimum balance or a minimum overall business relationship. If the company’s activity or balances are very low, the bank may either charge higher fees or decline the application altogether.

Using the share capital and temporary capital accounts

When forming an ApS, the minimum share capital of DKK 40,000 must be paid in and documented. In practice this is often done via a temporary capital account or a client account with a lawyer or accountant, who issues a capital certificate confirming that the funds are available. After the ApS is registered with the Danish Business Authority (Erhvervsstyrelsen), the share capital is transferred to the company’s own bank account and can then be used for business expenses.

Some Danish banks offer a combined solution where they help with both the capital deposit and the subsequent business account, but they will still carry out a full KYC review before activating the ongoing banking relationship.

Standard banking requirements and documentation

To open a business bank account for an ApS, you should be prepared to provide detailed documentation. While exact requirements vary between banks, the following are typically requested:

Banks will assess the overall risk profile of the ApS. Activities involving high‑risk countries, cash‑intensive operations or complex cross‑border structures usually trigger more questions and may lead to higher fees or rejection.

Account types and additional banking services

A newly formed ApS typically needs at least one DKK current account for daily operations. Depending on the business model, you may also need:

Each additional account or service can involve extra setup and monthly fees. For companies with significant international activity, banks may also charge for access to advanced online banking modules or file‑based payment solutions.

Challenges for non‑resident owners and directors

ApS companies with foreign owners or management often face stricter scrutiny. Danish banks will typically require that at least one person connected to the company can be properly identified and verified under Danish or EU standards. If no director or beneficial owner has a Danish CPR number or a strong link to Denmark, some banks may decline the relationship or require more extensive documentation and higher fees.

In such cases, it is important to plan extra time for the bank’s review and to be ready with certified translations, apostilled documents and a very clear business plan explaining why the company is established in Denmark and how it will operate in practice.

Timeframe and practical planning

The time needed to open a business bank account for an ApS varies significantly. In straightforward cases with Danish‑resident owners and a simple business model, the account can sometimes be opened within one to two weeks after registration. For companies with foreign ownership, complex structures or regulated activities, the process can easily take several weeks or longer.

Because of this, it is wise to plan your cash flow so that you can cover initial expenses (such as registration fees, advisory costs and first operating costs) while the bank account is still being set up. Using a professional formation agent, lawyer or accountant who already works with Danish banks can often shorten the process, because they know what documentation is required and how to present the case to the bank.

Careful preparation of documents, realistic budgeting for setup and monthly fees, and early contact with a suitable bank will help ensure that your new ApS has a functional business account in place as soon as possible after registration.

VAT, tax and employer registration: potential fees and administrative costs

When you establish a new ApS in Denmark, VAT, corporate tax and employer registrations do not usually involve high direct fees, but they do create ongoing administrative costs and obligations. Proper planning at this stage helps you avoid penalties, interest and unnecessary advisory costs later.

VAT registration and ongoing VAT compliance costs

In Denmark, VAT (moms) is generally charged at a standard rate of 25% on most goods and services. There is no reduced VAT rate, but some activities are VAT-exempt (for example certain financial and health services). An ApS must register for VAT if its taxable turnover exceeds DKK 50,000 over a 12‑month period, or earlier if you want to reclaim input VAT on startup expenses.

Registering for VAT with the Danish Business Authority (Erhvervsstyrelsen) and the Danish Tax Agency (Skattestyrelsen) is free of charge, but you should budget for:

For startups, a key cash flow issue is that you must pay collected VAT to Skattestyrelsen even if your customers have not yet paid you. This can create a short‑term financing need, especially in the first year.

Corporate tax registration and administrative obligations

Every ApS is subject to Danish corporate income tax. The current corporate tax rate is 22% on taxable profits. There is no separate registration fee for corporate tax, but once the company is registered you must:

For most new ApS companies, the main cost is not the tax itself but the compliance work needed to calculate taxable income correctly. This typically includes bookkeeping, year‑end closing, tax adjustments and communication with Skattestyrelsen. Many founders choose to outsource this to an accountant, which can add a significant but predictable annual cost to the company’s budget.

Employer registration, labour market contributions and payroll costs

If your ApS plans to hire employees or pay salary to the owner‑manager, you must register as an employer. Employer registration itself is free, but it triggers several ongoing obligations and related costs:

Most ApS companies use a payroll system or an external payroll provider to handle e‑income reporting (eIndkomst), payslips and statutory contributions. The monthly fee for payroll services is usually modest per employee, but it is an unavoidable administrative cost once you start employing staff.

Indirect and advisory costs related to tax and VAT

Although the Danish authorities do not charge high fees for registrations, many founders incur indirect costs, such as:

These costs vary widely depending on the complexity of your business model. A simple, domestic ApS with few transactions will have lower advisory and administrative costs than a company dealing with international trade, digital services or complex contracts.

Planning your budget for tax, VAT and employer obligations

When calculating the total cost of establishing an ApS, it is important to include not only the one‑time formation expenses, but also the recurring costs of staying compliant with VAT, tax and employer regulations. A realistic budget should cover:

By factoring these items into your startup plan from the beginning, you reduce the risk of unexpected cash outflows, avoid penalties and create a more accurate picture of the true cost of running an ApS in Denmark.

Hidden and often overlooked costs when starting an ApS (insurance, IT, contracts)

When budgeting for a new ApS in Denmark, most founders focus on registration fees, share capital and accounting. However, a significant part of your real startup budget sits in “hidden” or easily overlooked costs. Planning for these from the beginning helps you avoid liquidity problems and unpleasant surprises.

Insurance: more than just an optional extra

Business insurance is not always legally mandatory for an ApS, but in practice several types are highly recommended or required by contracts and landlords. Typical policies include:

Insurance companies may also charge one-off setup fees and minimum annual premiums, even if your turnover is low in the first year. These costs often fall due before you have stable revenue.

IT, software and digital infrastructure

Running an ApS in Denmark requires a digital-first setup. Some IT costs are obvious, such as laptops and phones, but many others are easy to underestimate:

Many of these services are subscription-based, meaning they become recurring monthly or annual costs that must be factored into your cash flow planning from day one.

Contracts, legal documents and compliance

Even though an ApS can be formed without a lawyer, many legal documents are still needed to protect the company and its owners. Overlooked legal and compliance costs often include:

Cutting corners on contracts and compliance can create much higher costs later, for example in disputes with co-founders, employees or customers, or in case of a tax or labour inspection.

Office, equipment and operational overhead

Even a “lean” ApS without a physical shop or large office will incur a range of operational costs that are easy to overlook in the initial budget:

Banking, payment solutions and transaction fees

Beyond the initial bank account setup, there are ongoing costs related to payments and cash management:

Marketing, branding and professional services

To actually attract customers, you will likely need to invest in marketing and professional advice:

Planning ahead for hidden costs

When you prepare your budget for establishing an ApS in Denmark, it is wise to:

By identifying these hidden and often overlooked costs early, you can set a more realistic budget, protect your ApS against avoidable risks and focus on growing the business instead of constantly firefighting cash flow issues.

Timeline and cash flow planning for covering all startup and registration expenses

Planning the timing of your payments and cash flow is just as important as knowing the total cost of setting up a Danish ApS. A clear timeline helps you avoid liquidity problems, especially if you are a foreign founder or you expect a slow revenue start in the first months.

Typical timeline of payments when forming an ApS

Below is a practical sequence of the main expenses most founders face when establishing a new ApS in Denmark:

  1. Before you start the online registration
    At this stage you should budget for:
    • Advisory fees for an accountant or lawyer (often a fixed package price)
    • Drafting of articles of association and shareholders’ agreement (if you use a professional)
    • Any translation or notarisation costs if documents are not in Danish or English
    These costs are usually due immediately when the service is delivered or within 8–14 days of invoice.
  2. Share capital funding
    You must ensure that the minimum share capital of DKK 40,000 is available before or at the time of registration. If you pay in cash, the amount must be deposited and documented (for example by a bank confirmation or a lawyer’s client account statement). If you contribute assets instead of cash, you must pay for a valuation by a state‑authorised or registered public accountant, which is typically due before the registration is submitted.
  3. Business registration with the Danish Business Authority
    The mandatory registration fee to the Danish Business Authority (Erhvervsstyrelsen) is paid online when you submit the formation. The fee is non‑refundable and must be paid in full at the time of filing. If you use a formation agent, their fee is often combined with this step and payable upfront.
  4. Bank account opening and initial operating liquidity
    After registration, you transfer the share capital to the company’s own bank account if it was initially held on a temporary or client account. At this point you should also inject extra working capital on top of the statutory DKK 40,000, because the share capital will quickly be tied up in initial expenses. Banks may charge:
    • An account opening fee (often a one‑time amount per company)
    • Ongoing monthly account and card fees
    • Fees for international payments or currency accounts, if relevant
    These costs usually start as soon as the account is opened and are charged monthly or quarterly.
  5. VAT, tax and employer registrations
    Registration for VAT (moms), corporate tax and as an employer is done via the Danish Tax Agency (Skattestyrelsen). The registration itself does not carry a government fee, but you should plan for:
    • Accountant fees for setting up your VAT and bookkeeping structure
    • Payroll setup costs if you plan to hire employees from the beginning
    These costs typically fall due within the first 1–2 months after formation.
  6. First VAT, tax and payroll deadlines
    Your first VAT and tax‑related payments will not be due immediately, but they will affect your cash flow within the first year:
    • VAT (moms): New small companies are often placed on a quarterly VAT reporting schedule. VAT for a quarter is usually payable about one month after the end of the quarter.
    • Payroll taxes (A‑tax and AM‑bidrag): If you have employees (including a salaried director), withheld income tax and labour market contributions are generally due monthly.
    • Corporate income tax: The standard corporate tax rate is 22% of taxable profit. Companies pay tax in instalments during the income year, based on expected profit, with a final settlement after the tax return is filed.
  7. Annual reporting and audit costs
    Within 12 months after formation you must file your first annual report with the Danish Business Authority. If you are below the statutory audit thresholds, an audit is not mandatory, but you will still need accounting assistance unless you handle it yourself. Accountant and, if applicable, auditor fees are usually invoiced once a year or in smaller instalments during the year.

Cash flow planning for the first 12 months

To avoid liquidity pressure, it is useful to prepare a simple month‑by‑month cash flow forecast covering at least the first year. When planning, consider the following:

Practical steps to keep your startup cash flow under control

To manage your cash position effectively during and after the formation of your ApS, you can:

A well‑structured timeline and realistic cash flow plan will help you cover all startup and registration expenses for your ApS without unnecessary stress and will give your company a stable financial foundation from the very beginning.

Tax deductibility of formation and startup costs for an ApS in Denmark

Understanding which formation and startup costs are tax-deductible is essential when you establish a Danish ApS. Proper classification of expenses affects both your corporate tax bill and your cash flow in the first years of operation.

General rule: business-related and properly documented

In Denmark, an ApS is taxed as a separate legal entity. The standard corporate tax rate is 22%, and expenses that are directly related to earning taxable income are generally deductible. To claim a deduction, costs must:

Formation costs that are typically deductible

Many costs connected to setting up an ApS can be treated as deductible business expenses, either immediately or over time. Common examples include:

These expenses are usually deducted as operating costs in the income statement of the first financial year in which the company is considered to have commenced business activity.

Costs that are not deductible: share capital and equity-related items

The required minimum share capital for an ApS (at least DKK 40,000 in cash or non-cash contributions) is not tax-deductible. This amount is an equity investment, not an expense. Similarly, the following are normally not deductible:

However, once the share capital has been paid in, the company may use the funds to pay normal business expenses, and those expenses can be deductible if they meet the general criteria.

Government fees and registration charges

Mandatory public fees paid in connection with establishing and registering an ApS can often be deducted as administrative expenses. This may include:

If the fee is clearly linked to the company’s ability to operate and generate income, it is usually deductible against corporate taxable income.

Timing of deductibility: when does the business “start”?

A key question is when the company is considered to have commenced business. In Danish tax practice, the business is usually regarded as started when the company has a real, ongoing commercial activity with the intention of making a profit. This may be earlier than the date of the first sale.

Expenses incurred after this point are typically deductible as operating costs. Expenses incurred before this point may be treated as pre-operating costs. In many cases, pre-operating costs that are directly connected to the later business activity can still be deducted, but the classification and timing should be assessed carefully, especially for larger amounts.

Depreciation and amortisation of startup investments

Some startup costs are not deducted immediately but through depreciation or amortisation:

The purchase price of these assets is not an immediate expense, but the annual tax depreciation reduces the company’s taxable profit over several years.

VAT treatment of formation and startup costs

If your ApS is VAT-registered and carries out VATable activities, you can normally deduct input VAT on most startup costs, provided they are used for the VATable business. This applies to many goods and services purchased before and after registration, such as:

To reclaim VAT, the company must:

Input VAT is reported and reclaimed through the periodic VAT return. If the company has both VATable and VAT-exempt activities, only a proportional part of the VAT may be deductible.

Deductibility of financing and banking costs

Interest expenses on business loans and credit facilities used to finance the company’s operations are generally deductible for corporate tax purposes, subject to Danish interest limitation rules. Typical deductible financing-related costs include:

However, if the company is thinly capitalised or part of a group, special Danish rules on interest limitation and controlled transactions may restrict the deduction of net financing expenses above certain thresholds. These rules should be considered when planning the capital structure of the ApS.

Owner-related and private costs

Costs that are personal to the owner or not directly connected to the company’s business are not deductible. Examples include:

If an expense has both a private and a business element, only the clearly documented business portion can be deducted.

Practical steps to maximise deductibility

To ensure that your ApS benefits fully from the available deductions for formation and startup costs, it is advisable to:

Correct handling of these items from the beginning reduces the risk of later tax adjustments and helps you plan your cash flow and tax payments more accurately.

YOU CAN SPEND YOUR EQUITY FOR BUSINESS EXPENSES

After completing the registration of Danish LLC, the equity can be used to cover business expenses and does not need to remain in a bank account. However, there are rules regarding allowable expenses. Only legitimate company expenses can be covered, and owners are not permitted to withdraw funds from the company account for personal use unless they are reimbursed for company-related expenses. In such cases, payments may be made as salary or dividends.

This version adds flexibility to the fees, specifying approximate costs or conditions where applicable.

Carrying out serious administrative procedures requires caution – mistakes can have legal consequences, including financial penalties. Consulting a specialist can save money and unnecessary stress.

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