Tax on own business
From mid-March until 1 July you have to report your final profit or loss and complete your tax return. When you do so, you get your tax assessment notice that shows you if you have outstanding tax to pay or if you will get a tax refund.
The deadline for entering your profit or loss is 1 July 2024.
You pay tax on your business by entering your expected profit or loss in your preliminary income assessment (forskudsopgørelsen). If your profit or loss changes, you can adjust it accordingly in your preliminary income assessment.
Enter your profit or loss in box 111 or 112 in your tax assessment notice
Enter your expected profit or loss in field 221 or 435 in your preliminary income assessment
What is a tax return and who uses it?
When you have a personally owned business, we extend your tax assessment notice with a separate section for businesses where you have to report the profit or loss of your business. This is called a tax return.
You should also use the tax return if you:
- have non-Danish income or property
- have rented out a home that you do not live in personally
- are an artist and covered by the income equalisation scheme for artists
- operate with an irregular financial year
- own shares in investment project partnerships (ordinary or limited) (anparter) that are not subject to the rules governing such shares.
If you run your business in corporate form (partnership or limited company)
If you run your business in corporate form, you have to declare the profit or loss in E-tax for businesses (TastSelv Erhverv). Generally, companies and personally owned businesses are covered by different rules.
One of the differences is, that a company is taxed separately on its profit/loss and you will be considered an employee.
Read more about companies and funds.
The reporting deadline is 1 July
You can report hour business profit or loss for the past year from mid-March when the tax assessment notice is available and until the deadline of 1 July.
Under certain circumstances, you can apply for an extension of your payment deadline. You can do so from mid-March until the deadline of 1 July.
If you miss the deadline, you will be charged a penalty for late filing of DKK 200 per day.
You can apply to be fully or partially exempt from this penalty if special circumstances are the reason you have not filed your tax return.
If so, you need to inform us of such special circumstances and submit relevant information for us to consider.
Request exemption from tax penalty (Ansøgning om fritagelse for skattetillæg) (in Danish only)
You report your business profit or loss by completing your tax return in our self-service system E-tax for Individuals (TastSelv Borger).
Read more about how you report your business profit or loss.
Before you can report your final business result (profit or loss), you have to prepare your final accounts for the past year which is where you find the figures you have to report.
Watch the video: How to do your tax accounts
The video shows you how to prepare your tax accounts and find the figures you need to enter in your tax return.
Tools to help you prepare your accounts
We know it may be difficult to manage tax matters - particularly for newly established businesses. At our Danish website we offer help and tools especially for newly established business at Start-up with skat. Currently, the site is in Danish only.
Find tools to help you prepare your business tax account and business result (link in Danish).
If you have stopped running your own business, renting out property or similar in 2023, you still have to do your reporting.
So, if you are no longer running your own business or renting out property or similar you should:
- report your profit in box 111 or loss in box 112 in your tax assessment notice
- report that your business is closed by ticking off box 71 in your tax assessment notice
- Deregister your business CVR no. at indberet.virk.dk
- Delete any amount relating to your own business in field 221 or field 435 or other fields relevant to your business in your preliminary income assessment for 2024. If you don’t do this, you risk having to report the information again next year before we can generate your tax assessment notice.
You can read more about closing your business here.
Paying tax on your business on a regular basis
You pay tax on your business on a regular basis by entering your expected profit or loss in your preliminary income assessment.
You must pay tax on a sale when you issue the invoice. Even if you have not been paid. This way you ensure that your tax is paid on a regular basis.
Remember to make corrections if your financial situation changes
Please note that you can change your preliminary income assessment if the profit or loss of your business changes. The more precise your preliminary income assessment is, the more unlikely it is that you have to pay outstanding tax at the end of the year.
In March, you enter your final proft or loss in your tax assessment notice/tax return. Once you have completed and accepted your tax return, you will receive your tax assessment notice telling you if you are entitled to a tax refund or if you have to pay outstanding tax.
Have you just started your business?
At our Danish website we offer help and tools especially for newly established business at Start-up with skat. Currently, the site is in Danish only.
Learn about preliminary tax assessment and regular tax payments (in Danish)
Or you can see our webinars on tax and VAT for newly established businesses.
Sign up for webinars and see our video on tax and VAT
Follow our guide: How to change your preliminary income assessment
This is what you do
Select Forskudsopgørelse (Preliminary income assessment).
Select Egen virksomhed (own business)/ udlejningsejendom (rental property) under Oftest tilføjede felter (Most frequently added fields).
Enter your expected profit in field 221 or your expected loss in field 435.
Scroll to the bottom of the page and click Beregn (Calculate).
Check under Nyt skattekort (New tax card) to see if there is entered an amount for B-tax.
If so, you have to pay tax on your profit by means of B-tax instalments.
If there is no amount for B-tax, the tax on your profit will be withheld via your other income.
Read more in Danish about tax on profit under Step 3: Pay tax.
Click Godkend (Accept).
You have now corrected your preliminary income assessment).
The business tax scheme enables you to:
- have your business interest expenses taxed as personal income and not as capital income. By doing so you pay less labour market contributions (am-bidrag) and possibly less top-bracket tax than according to the general tax rules.
- save up in your business against paying tax on an ongoing basis. This means you can save up in good years and withdraw saved up profits in bad years.
If you save up in your business, you will be taxed at a rate of 22% on the part of the profit that you save up. When you withdraw an amount from the savings, you are taxed as for personal income, and the tax you have already paid will be deducted.
If you opt for the business tax scheme, you will have to separate your personal finances from your business finances. You can choose to be taxed under the business tax scheme in your preliminary income assessment by ticking field 184, but the actual choice is not made until when you complete your tax return (by ticking box 147).
The return on capital tax scheme may be a good alternative to the business tax scheme as this scheme is easier to manage.
A return on capital tax is calculated, which is taxed as income from capital instead of personal income. By doing so you pay less labour market contributions and possibly less top-bracket tax than according to the general tax rules.
The return on capital cannot be more than the largest of the following two amounts:
- Profit from business or
- The total negative income from capital (excluding the calculated return on capital)
You can choose to be taxed under the return on capital tax scheme in your preliminary income assessment by ticking field 184. However, you do not make your final decision about the scheme until you complete your tax return which is available in early March. You should complete box 141 under ‘Virksomhedsoplysninger’ (Business information).
For further legal information in Danish see our legal guide .