Launching a Business in Denmark: Essential Checklist

Launching a Business in Denmark: Essential Checklist

Starting a business in a new country can be overwhelming, but breaking it down into steps makes it achievable. Here’s a step-by-step checklist for launching a business in Denmark. This list covers everything from choosing a structure to getting insured, with short explanations for each step. Use it as a roadmap to go from idea to an operating company.

1. Choose a Business Structure – Decide if you’ll operate as a sole proprietorship or create a company like an ApS. This choice affects your liability and taxes (see our post on company types above). For most international founders, an ApS (private limited company) is a solid choice due to liability protection, especially if you don’t have a Danish CPR number (non-residents typically can’t open a sole proprietorship easily). Consider future plans: will you have co-founders or investors? If yes, an ApS is better suited.

2. Pick a Company Name and Address – Come up with a unique business name that isn’t already taken on the Danish CVR register. You can search existing names on the Virk.dk site. Secure a legal address in Denmark for your business – this will be your official registered address. It can be your home (if you reside in Denmark) or a virtual office service. Note: A P.O. Box alone is not acceptable; it must be a physical address where you can receive mail. If you’re abroad, many providers offer a virtual business address in Denmark that you can use for registration.

3. Register Your Business (CVR Number) – Go to the Virk.dk portal and use the “Start Company” online ^{registrationbusinessindenmark.virk.dk}. You’ll need to provide details like owners’ information, business address, and choose business codes (NACE codes) describing your activities. If you’re forming an ApS, you’ll also input share capital details and sign the formation documents (using MitID or digital signature). Once completed, you’ll receive a CVR number – this is your official company ID (like a registration number). Tip: If you don’t have a MitID (Danish e-ID), you may need to use a special form to registe^{rbusinessindenmark.virk.dk} or get help from a formation agent.

4. Register for VAT (MOMS) if Needed – Decide if you should be VAT-registered from the start. If you expect to make over DKK 50,000 in sales within the next 12 months, you must register for VAT^skat.dk (you can do this during the CVR registration by checking the VAT box). Even below that threshold, you can opt in voluntarily. Registering means you’ll charge 25% on sales and can reclaim VAT on expenses. If you’re unsure, consult an advisor – but it’s often wise to register if you have any significant startup costs (so you can get the VAT back on those).

5. Set Up a Business Bank Account – Open a Danish business bank account for your company. This is important to keep finances separate (especially for an ApS, which legally must not mix personal and business funds). Having a Danish bank account also enables you to get a NemKonto (the account linked to government systems for any refunds or payments to you). Banks in Denmark will require proof of your company (CVR number, articles of association for an ApS, IDs for the owners). If you’re abroad, some banks might require you to visit in person or provide extra documentation. Shop around, as some banks are more startup-friendly or experienced with non-resident founders.

6. Get Your MitID/NemID and Digital Post – If you’re a resident, you likely have a MitID (personal digital ID). For the company, you’ll also use NemID/MitID for businesses (sometimes called a Medarbejdersignatur). This allows you to log into government and banking systems on behalf of the company. Next, set up Digital Post for your business – this is an official e-mailbox (on e-Boks or similar) where government letters will be sent. By law, companies in Denmark must subscribe to Digital Post, so you don’t miss important communications. You can set this up once your CVR is active. It’s crucial because things like tax notices or official deadlines will come to this digital mailbox.

7. Register for Tax and Employers’ Duties – Aside from VAT, ensure you’ve noted your obligations with SKAT (Tax Authority). If you plan to pay salaries (to yourself or employees), register as an employer for withholding A-tax and AM contributions. If you’re a sole proprietor, you’ll handle taxes via your personal tax self-assessment. If you’re an ApS, you’ll eventually need to file corporate tax returns (typically via an accountant). It’s also a good idea to familiarize yourself with SKAT’s E-tax portal (TastSelv) for businesses, where you file VAT, payroll, etc. Getting access set up early will save headaches later.

8. Obtain Necessary Licenses or Permits – Check if your business field is regulated. Most ordinary businesses in Denmark do not require special permits, but some do (for example, food services need food authority registration, finance businesses need a license, certain trades might need certifications). The Virk “Start Company” guidance can indicate if any sector-specific permits are required. Make sure to apply for those permits before you fully launch operations.

9. Set Up Accounting & Bookkeeping – Establish a system to keep track of income and expenses from day one. You can use an online accounting software (many in Denmark offer English versions) or hire a bookkeeper/accountant. Good bookkeeping is vital not only for running the business but also for meeting Danish reporting requirements. An ApS must file an annual financial statement to the Business Authority, and all businesses must keep records for tax. Decide on a bookkeeping solution early, connect it with your bank if possible, and schedule a routine (e.g. log receipts weekly). This will make VAT reporting and annual taxes much easier.

10. Arrange Insurance – Some insurances are mandatory, others are simply smart. If you will have employees, you must take out workers’ compensation insurance (arbejdsskadeforsikring) to cover injuries at work. This is required by law as soon as you hire staff. Even if you have no employees, consider business insurance such as: general liability insurance (erhvervsansvarsforsikring) to cover damage to third parties or property, product liability if you sell goods, and professional indemnity if you’re giving advice. Also, look into insurance for your assets (theft, fire) and possibly insurance that covers you as an owner (health, disability, etc., though that may be more relevant if you reside in Denmark). Having the right insurance protects you and gives credibility when working with clients.

11. Plan for Pension and Payroll (if applicable) – (Optional step for when you have employees or if you as an owner want to save for pension.) Denmark doesn’t require companies to provide private pensions except in certain union agreements, but it’s common to offer. If you’ll scale with employees, research setting up a pension scheme and be aware of holiday pay rules (you’ll typically use the eIndkomst system to report salaries and accrued holiday). For now, just note this as a future step once hiring.

12. Network and Get Advice – Finally, immerse yourself in the local business ecosystem. Join networks like local chambers of commerce or entrepreneur groups. The Danish Business Authority offers resources for startups, and there are often free programs for new businesses (Startup Denmark programs, etc.). Connect with other international founders in Denmark to share tips. And don’t hesitate to consult professionals (accountants, lawyers) especially when dealing with legal or tax matters – a little guidance early on can save costly mistakes later.

Following this checklist will put you on the right track. Each business is unique, so you might have a few additional steps depending on your industry. But overall, these are the essentials to get your Danish business off the ground confidently and in compliance with local rules.

Need a helping hand to navigate the Danish business setup? We specialize in assisting international entrepreneurs start their companies in Denmark smoothly. Contact us to get personalized help with any step of the process, or book a free startup consultation today.