Denmark - ApS

Company formation

Denmark has signed double taxation agreements with most countries, including Russia. The Closed-Type Joint-Stock Company (ApS) promotes business-class attraction from Russia and many other countries. Due to significant advantages, ApS is considered to be one of the best legal forms of business within the Scandinavian Region. The created environment allows successful functioning and holding development.

General information

The legal business form Anpartsselskab – Closed-type Joint-Stock Company (ApS) that is suitable for small business and middle-level companies.

Denmark APS - Company Formation

In its structure, this type of business is identical to German Gesellschaft mit beschränkter Haftung, the Limited liability Company and the Dutch Besloten Vennootschap met beperkte aansprakelijkheid — Privаte Limited Company (BV − LLC).

The management of the company is carried out by Board of Directors, at the request of founders a Supervisory Board may be elected that will consist of three persons. All natural persons involved in the company’s management should be listed in the company’s constituent documents.

Thanks to the loyal policy and flexible legislation of the country, there is no requirement to specify the purpose of activity of the commercial firm in the Memorandum of Association.

This is binding in countries with tougher requirements (for example, in Britain). Each year, the company should form and submit two forms of strict reporting to relevant authorities: Financial statement and Annual Return. The periodicity of documents submission is once every twelve months.

In order to avoid double taxation and for the purpose of convenient management of the holding company, one is recommended to choose a resident of the European Union (including Denmark) as a shareholder (main or sole) with whom the relevant agreement is signed.

Denmark APS - Company Formation

Benefits of registering the ApS company in Denmark

Companies that register in Denmark will not be exempt from the tax burden since the country is not a typical offshore. According to the applicable legislation the tax should be paid in total for the profit received in all countries of the world. However, preferential rates introduced, the possibility of tax rate reduction and the loyal system of deduction make Denmark as an attractive place for foreign businessmen to settle. Despite the fact that Denmark is not specified as the offshore zone, foreign enterprises that register in the country will be granted a variety of advantages and opportunities. Main benefits of commercial activity registration in the territory of Denmark are the following:

No hard currency regulation;

Status of prestigious and stable jurisdiction. The policy of the state has good will;

The country is not a “tax haven”, it is not on the list of regions not recommended to collaborate;

70 countries of the world signed the double taxation agreement with Denmark (including Russia and Ukraine);

Warranty of complete confidentiality and anonymity of personal data of founders and owners;

Complete package of documents to be ready for just one business day;

Possibility of document delivery to any country of the world;

Simplified and encouraging tax policy of the government.

Denmark APS - Company Formation

Specificity of the registerin

To register a company, the following is necessary to register a new company or to choose one running company from the offered list. Then to submit complete personal information about the owner of the company for registration and to make a prepayment for registration. The registered company will receive the following package of documents:

Without a nominal service:

Certificate of formation;

Operating agreement;

Statement of organizer;

Page with apostille.

With a nominal service:

Resolution on registration of power of attorney;

Power of attorney with Apostille;

Resolution on the director replacement with open date;

Letter of acceptance to act as the Nominee Director;

Refusal to act as the Nominee director with open date;

Nominee Director’s declaration on the provision of nominee services;

The trust tax return from the nominee shareholder;

Transfer documents for shares, open date.

Taxation

The corporate income tax rate is 25%. If the company receives the status of holding, it will be granted a variety of benefits. The amount of tax on dividends from the foreign subsidiary company is equal to zero.

Denmark APS - Company Formation

The basic requirement is that the company of Denmark is obliged to own a package of shares (at least fifteen percent) for a period of twelve months or longer. Besdies, a subsidiary should not be classified as a “low-tax” company. Under other conditions, CIT (corporate income tax derived from the subsidiary) is equal to zero if the holding owns a subsidiary for three years long. In such a case, a subsidiary should not belong to a company with the low tax burden.

For companies there is a limitation in terms of debt capitalization. The company’s total loans should not exceed its capital four-fold. If the total share of loans exceeds the size of the capital five times or more, the decision is made on the impractical payment of interest, which in turn does not contribute to reducing the tax burden.

If the main purpose of company is to get benefits to avoid double taxation (by signing the international agreement) and this will be proved adequately − the holding shall be deprived of benefits based on corporate laws. The fixed value-added tax rate is 25%. The rate on periodic form of license fee payment (royalties) is 25%. Profit as dividends is levied at the source of payment at twenty eight percent. Zero royalty rate can be obtained by the enterprise in case if the company holds transactions related to fees (payment for the use of copyright).

The beneficiary of the cash compensation shall be a resident of the European Union or another state (with which the double taxation agreement is signed). One tenth of all shares of the firm for a period of not less than twelve consecutive months must belong to the legal entity (beneficiary of remuneration).

Denmark APS - Company Formation

Legal system

Registered companies should comply with the following main conditions:

The company will be assigned the legal form as anpartsselskab;

Authorized capital in the amount of 128 000 Danish kroons (amount is paid in full);

The company consists of shareholders (both legal entities and natural persons) – including those that have one person in the staff with the director to be solely a natural person (from one person);

Abbreviated name – ApS will be used with words Trust/bank/insurance to get the necessary license;

Tax rates for holding operations – from 0%.

Using services of our company, you can pay the advance payment at the rate of 30%. Only as you receive and check the validity of the package of documents, the client pays the rest 70%. Documents will be communicated as scanned copies, including the certificate of registration.

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