In the Doing Business 2020 ranking, Denmark is ranked 4th in terms of ease of doing business. And this is despite the fact that the government has established some of the highest taxes in the world. Nevertheless, business is thriving. People come to Denmark to start their businesses from France, Spain, and other countries. This is because the income level is high, business operations are maximally transparent and clear, there are no tax surprises from the government, and there is no raiding or other unpleasant phenomena typical of post-Soviet countries. Let’s consider a few business ideas that foreigners can implement in Denmark and achieve stable income.

Read also: Company registration in Europe: where, how, and why to invest money

Contents:

1. Advantages of starting a business in Denmark
2. Idea #1. Starting an innovative business
3. Idea #2. Making money in the food service industry
4. Idea #3. Entering the Danish agribusiness
5. Idea #4. Buying an existing business in Denmark
   • How to buy a ready-made company in Denmark?

Advantages of starting a business in Denmark

This country is one of the easiest places in the world for formalities to register a company. You can obtain an individual tax number CVR online on the Virk portal. No notarial documents, original signatures, or personal presence is required when registering your company. Virk is a self-service site for Danish entrepreneurs where you can learn about VAT, hiring and firing employees, changing company registration details, and much more.

Among other advantages, company registration in Denmark also includes:

• There is a double taxation avoidance agreement with 70 countries in Asia, Europe, America, and the CIS.
• Banks provide loans to companies, for example, for purchasing cars, equipment, and inventory necessary for successful business operations. Before going to the bank, you need to prepare a clear description of the purpose of the funds, client base characteristics, and budget. Entrepreneurs will not receive money if there are tax arrears or VAT issues.
• Ownership and management of a Danish company can be held by a citizen of any country in the world.
• Companies registered in Denmark have direct access to the EU market, covering more than 100 million consumers.
• The country has political, judicial, legal, and tax transparency. There is active state support for small and medium-sized businesses. For example, companies with a turnover of up to 15 million krone are allowed a VAT payment deferral of up to 40 days.
• Denmark has macroeconomic and financial stability, high levels of education and workforce qualifications.
• As of 2020, according to the Corruption Perceptions Index, Denmark has the lowest level of corruption among Scandinavian countries.
• It has one of the lowest levels of inflation and unemployment among European countries.
• A wide range of organizational and legal forms of business allows you to establish a company that best fits your project. Entrepreneurs are allowed to use legal tax optimization schemes.
• In most EU countries, you need to declare your income and pay corporate tax monthly. In Denmark, this is done once a year.
• Denmark is a member of the EU, OSCE, WTO, OECD, EFTA, and other international organizations and associations.
• There are no currency restrictions; foreign currency can be imported or exported from the country.

Denmark’s state policy is aimed at comprehensive economic development and supporting entrepreneurs. It is easy to start a business in this country, and staying afloat is feasible.

The economy of this Scandinavian country largely depends on the service sector, so it is profitable to start a tourism service, mini-hotel, or beauty salon in Denmark. But that’s not all. Let’s consider other ideas for starting a business in Denmark.

May be of interest: Buying a ready-made company: where it is more profitable and who needs it

Idea #1. Starting an innovative business

You can join the ranks of Danish entrepreneurs through the Start-up Denmark program. This is a great option for a startup with a unique business idea. Under the Start-up Denmark program, up to 50 residence and work permits are issued annually. The scheme works for one or two people who want to start a business in Denmark.

Keep in mind that the idea must be truly innovative, meaning you cannot use this program to open an ordinary café or store. Furthermore, your business must provide value to the country’s economy and create additional jobs.

To participate in the program, in addition to the idea, you will need:

• A ready-made business plan, which can be downloaded from the official program website.
• Personal presence in the country and participation in the business. You cannot be a shareholder of the company, receive dividends, and live elsewhere.
• Documentary proof of savings sufficient to support yourself and your family members (if any) for 1 year. A bank statement proving the applicant’s financial solvency is required.

The business idea must be approved by a group of Danish experts. The residence and work permit is issued for up to two years, with the possibility of extending it for another 3 years.

Idea #2. Making money in the food service industry

Denmark has popular both inexpensive snack bars and café-bars, as well as upscale restaurants. The income level allows Danes to spend time with family and friends in a cozy café not only on holidays but also on any day of the week. Additionally, tourists from neighboring countries such as Germany, Sweden, the Netherlands, and Norway often visit.

The food service sector does not require huge investments, making it especially attractive for foreign entrepreneurs. To open a café or restaurant in Denmark, you will need:

• To obtain Danish residency;
• To register as a sole proprietor or legal entity;
• To obtain permission for the production/sale of food products;
• To meet a number of legislative requirements, including those related to kitchen organization.

Danes are eager to try both local and international cuisines, including fast food. Therefore, you can open a snack bar, bar, or restaurant of any format here.

Idea #3. Entering the Danish agribusiness

The main agriculture of the country consists of family farms and individual land holdings. The products produced are in demand both within Denmark and abroad. You can rent a small farm and start producing and selling a specific food product in a farmer’s shop.

In this case, the business falls under the category of food. All enterprises must comply with food laws and regulations:

• Register with the Danish Veterinary and Food Administration;
• Create a self-control program, where the entrepreneur describes how the Food Act is adhered to;
• Organize a facility for processing and packaging products while adhering to sanitary and hygienic requirements;
• Pay annual fees, the amount of which depends on whether your business is retail or wholesale.

Denmark has the concept of a “hobby business.” For example, if you sell products at markets, exhibitions, etc., only occasionally and have an income of less than 50,000 krone per year, you do not need to officially open a business. Additionally, there are no requirements for bookkeeping and annual reporting in this case. However, you will still need to pay tax on the profit.

Note: What is more profitable — to start your own business or buy an existing business in Europe?

Idea №4. Buying a Ready-Made Business in Denmark

To save time on registering a new legal entity, you can buy an already established company. This is an excellent option not only for starting a new business but also for expanding an existing one.

Danish legislation does not prohibit the acquisition of already registered companies. Buying a ready-made business is often more advantageous and safer than starting your own business from scratch. Why? Offshore jurisdictions are chosen for several reasons:

• Legally permitted tax planning — offshore jurisdictions are places where companies are registered by owners who want to pay less tax and have minimal bureaucratic hurdles during company registration.
• Protection from unfavorable political situations in the resident’s home country — neither raider attacks, nor bureaucratic arbitrariness, nor other force majeure events are a concern.
• Anonymity of beneficiaries — there is no need to disclose information about non-resident founders at the request of authorities from other countries.

Useful to know: Who might have access to information about offshore beneficiaries?

Denmark is not a classic offshore jurisdiction, so companies registered in the country cannot be completely tax-free. However, the availability of many benefits, flexible calculation systems, and reduced rates all make the country attractive to foreign businessmen.

Denmark is a prestigious jurisdiction with a good reputation and is not on “blacklists” of countries. Therefore, you can effectively develop your business here, establish connections, and ensure entry into the international market. Starting a business in Denmark means demonstrating the prestige and reliability of your company to your partners and clients. An established foreign company will inspire more trust than a newly created enterprise.

By purchasing an offshore company, you get a ready-to-operate firm within a few hours. All that remains is to open a bank account, and you can start implementing your business plans. You won’t have to wait several months, gather numerous documents, or even personally visit the country to open the company.

Details and features of offshore jurisdictions in Denmark:

• Popular forms of ownership — open or closed joint-stock company (A/S or ApS).
• The country allows most types of entrepreneurship in the sale of goods and services. Prohibited activities include banking, insurance, and licensed activities.
• The owner and shareholders of an offshore company can be natural or legal persons — residents of any country in the world.
• There are no requirements for the residence of directors and members of the board of directors of the company.

Denmark is considered the most tax-friendly country for creating and operating international holding structures. A holding company established by at least 2 non-resident companies is exempt from tax on dividends received from foreign subsidiaries. The condition is that the holding company must hold a certain percentage of shares in such firms.

In other words, you can significantly save on taxes in Denmark by establishing the headquarters within the country while keeping operational assets outside the state.

How to Buy a Ready-Made Company in Denmark?

It’s quite simple: contact INVESTMAKLER. We will help you open an offshore business in Denmark or buy an already registered company. We select the jurisdiction based on the client’s goals and needs.

For this, you will need:

1. Provide data for company registration.
2. Choose a company with the most suitable name for your business or propose your own. If the name is not taken, you can name the company at your discretion (taking into account the country’s legal requirements).
3. Open an account in a bank or payment system in Denmark or another European country. The law does not restrict the company in choosing a financial institution and its location. Confidentiality of banking operations is ensured.

More details in the article: Opening Offshore Companies: Features, Deadlines, and Cost Calculation

Our company does not sell or recommend buying ready-made firms with an already opened bank account. Each financial institution carefully examines all cases of application to ensure the client’s financial security. Accounts are opened for a specific type of activity. The bank may subsequently close the account on the grounds that the company is not conducting the activity originally declared.

Therefore, we recommend opening an account in a bank after registering the company to a new owner. This will help avoid problems with third parties accessing your company’s financial operations.

INVESTMAKLER specialists will assist you at every stage of buying or registering an offshore company. You can leave a request on our website or contact consultants by phone or messaging apps.

From business idea to a ready-made company in Denmark, you are just a few steps away. Take them with us.