Denmark: Digital Bookkeeping

In the application of the Danish Bookkeeping Act and related Executive Orders, Danish companies and enterprises that conduct commercial activities subject to tax in Denmark are obliged to use a digital bookkeeping system at some point. 

Certain types of foreign enterprises’ activities may be outside of the scope of Digital Bookkeeping Act – i.e. this may be the case of a representative office that conducts only promotional activities but does not make actual sales.

The timelines within which the respective company will be covered by the requirement is determined based on the type of company and the start date of the company’s financial year:

• From 1 July 2024:
  • Companies with an obligation to submit an annual report under the Danish Financial Statements Act that currently use a registered bookkeeping system must book digitally from the first date they start a new financial year.

• From 1 January 2025
  • Companies with an obligation to submit an annual report pursuant to the Danish Financial Statements Act that use a non-registered bookkeeping system must book digitally from the first date they start a new financial year.

• From 1 January 2026
  • Personally owned companies with an annual net turnover of more than DKK 300,000 in two consecutive years (e.g. 2024 and 2025) must digitally book from 2026.

The Digital Bookkeeping aims to ensure transactions’ trail, control trail as well as backup, protection and security of the records within the applicable bookkeeping timelines (at least 5 years after the end of the accounting year it concerns).

The Digital Bookkeeping previews 3 different models regarding the way the standard chart of accounts, including the standard VAT codes, may be used:

• use of the public standard chart of accounts directly, e.g. as a one solution out of several;
• use digital standard bookkeeping system provider own chart of accounts mapped to the public standard chart of accounts, including standard VAT codes; and
• offer a tool making it possible for the customer to map its own chart of accounts to the common public standard chart of accounts.

The Digital Bookkeeping Systems should enable users complete the following:

• E-invoicing should be either implemented within the digital standard bookkeeping system or via access to an external supplier. Should ensure capacity to send and receive two types of document standards for e-invoices and credit notes – OIOUBL and Peppol BIS;
• SAF-T Accounting/Financial – capacity to generate SAF-T in compliance with the Authority set standards;
• submission of the Annual Report in the format accepted for upload in Regnskab Basis or Regnskab Spe­cial; and
• Facilitating the submission of VAT returns through the Danish Tax Agency’s VAT API (NemVirksomhed) – Digital Bookkeeping systems’ providers are required to ensure supporting the submission of VAT returns by their system being able to extract the correct VAT amount from the bookkeeping system, to enable transmission and receipt of acknowledgement of submission at the bookkeeping system. However, it is a responsibility of the enterprise to ensure that a VAT return is submitted correctly – i.e. the enterprises must therefore always approve the final VAT return themselves.

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