If as a Danish business, you do business with customers abroad, special VAT rules apply
The rules depend on whether you are selling goods or services, whether you are trading with businesses or private individuals, and whether you are trading within the EU or outside the EU (third countries).
In this article, we provide you with a general overview of the Danish rules on import and export.
What you should know
- Whether you should charge VAT when you sell (export) depends on whether you sell your services or goods to other businesses or to private individuals.
- When you are importing services or goods, you are responsible for calculating and paying the VAT in Denmark.
- VAT is 25 % in Denmark.
- As exporter/importer, you must report details on your trade directly to the Danish Tax Authority (SKAT).
- If you sell VAT-exempt services to businesses in EU countries, you still need to report to sale SKAT – even though the sale is VAT-exempt.
- You have to register as an importer/exporter, if your business trades with countries outside the EU.
- Note that certain specific goods – such as chocolate and spirits– can only be traded if you are registered for excise duties (Danish: “punktafgifter”).
When you sell (export) your services to businesses in other EU countries, you normally do not have to charge Danish VAT. The buyer is responsible for calculating and paying VAT in the EU country where his business is registered. However, if you are selling to private individuals in other EU countries, you should usually charge VAT.
When you buy (import) goods or services from abroad, you are generally responsible for calculating and paying VAT in Denmark. If the seller has added his own EU country’s VAT to the price, you still have to calculate and pay Danish VAT (25%) on the invoice amount. Afterwards, you can contact the seller and ask him to repay the VAT that he has already charged.
Moreover, you must report certain information to the Danish Tax Authority (SKAT) about your trade with customers abroad. As an example, you have to report the value of the sales to the individual customers and for the reporting period when you made the invoice. You can report electronically, under ‘EU sales exclusive of VAT’ in E-tax for businesses (TastSelv Erhverv).
If you have sold services exempt from VAT to businesses in other EU countries, you still should report to SKAT.
If you have sold services exempt from VAT to businesses in other EU countries, you still should report to SKAT. However, the value of the sales should not be reported in the general box B (goods and services), but in box C. You can read more about goods and services exempt of VAT and how to report sales and purchases in other EU countries, on skat.dk.
If your business imports or exports goods outside the EU, you need to register as an importer/ exporter at virk.dk. In addition, if your business imports, manufactures or sells goods subject to excise duties, you need to register for excise duties.
Tax is a complex and ever-changing subject. This article provided a simple overview. You cannot rely on this article as legal advice.
Do you conduct transactions abroad and would like to hear more about export and import duties in Denmark? Contact Wivi H. Larsen.
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