The Danish Tax Agency has introduced new reporting requirements for corporate income tax returns in 2024, following the implementation of the Minimum Taxation Act. This act brings Denmark in line with the EU’s Pillar Two directive, which enforces a 15% global minimum tax on multinational groups with annual revenues exceeding EUR 750 million.
As part of the new rules, all entities must answer two additional questions on their 2024 tax return, due by 30 June 2025. The questions ask if the entity is part of a group with revenue over EUR 750 million and whether it is subject to the Minimum Taxation Act.
It is crucial for entities to answer these questions accurately to avoid penalties. The “administration company” will be responsible for filing the returns and paying the Qualified Domestic Top-Up Tax (QDMTT).
Earlier, the Denmark Official Gazette published Law No.1535 enacting EU Council Directive 2022/2523 into domestic law on 13 December 2023, which aims to establish a global minimum level of taxation for multinational enterprise (MNE) groups and large domestic groups within the European Union.
The law applies a minimum tax rate of 15% to MNE groups with annual consolidated revenue exceeding EUR 750 million in at least two of the past four fiscal years. Adhering to the Directive and OECD Model Rules, the regulations establish an Income Inclusion Rule (IIR), Undertaxed Profit Rule (UTPR) and qualified domestic top-up tax (QDTT).
