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As of financial year 2021, Danish taxable entities with intercompany transactions are obliged to submit transfer pricing documentation annually. For companies with the calendar year as their financial year, the deadline for submission this year is 1 September 2025*. Ongoing deadlines apply for companies with financial years that do not follow the calendar year.

Danish transfer pricing documentation consists of two parts: country-specific documentation for the taxable entity (local file) and a group-wide documentation containing standardised information relevant for all group members of a multinational enterprise (master file).

* the exact deadline can vary from company to company but will be stated in the TastSelv universe

The transfer pricing documentation submission requirement applies to all taxpayers who engage in cross-border controlled transactions, to the extent that any of the following conditions are fulfilled:

• The taxpayer alone or together with group companies has more than 250 employees.

• The taxpayer, alone or together with group companies, has a total balance sheet of more than DKK 125 million and annual revenues of more than DKK 250 million.

• The taxpayer has cross-border controlled transactions with entities in countries with which Denmark does not have a double taxation treaty. 

Given the importance of transfer pricing documentation to both compliance and non-compliance risks, we recommend all companies obliged to submit the transfer pricing documentation to thoroughly prepare and review their transfer pricing documentations. This ensures that the minimum requirements are met, and any transfer pricing risks are identified and addressed appropriately.

Further, we encourage companies in doubt as to whether they are covered by the documentation obligation to check whether they actually fulfil the requirements and are thus obliged to prepare and submit transfer pricing documentation. The status should be filled out correctly in the information form as part of the corporate tax return.

If the company has indicated in the information form that it has controlled transactions and did not submit sufficient documentation in due time, there is a risk of fines and discretionary assessment. If, upon closer inspection, it turns out that the company is not actually covered by the documentation submission requirements, even though it has stated this in the information form, we encourage companies to enter into an active dialogue with the Danish Tax Agency. 

The fine for failing timely to submit or submitting insufficient transfer pricing documentation is generally DKK 250,000 per legal entity per income year. If sufficient transfer pricing documentation is subsequently prepared and submitted, the fine can be reduced to DKK 125,000. In addition, a fine of 10% of any discretionary income adjustment may be imposed.

If you have any questions regarding transfer pricing, you are more than welcome to contact us. ÀÖÓ㣨Leyu£©ÌåÓý¹ÙÍø Acor Tax is here to help you.