Closing a company is a multi-step and complicated process. It is important to carry out the procedure in the right order. This will allow you to maintain access to online systems and avoid future tax, customs or other liabilities. We will guide you through the process so that you can fulfill all formalities in accordance with Danish law.
Closing a company in Denmark requires going through a series of administrative and legal steps. This is a significant undertaking that must be carefully planned and executed. Regardless of the reason for the decision to terminate conduct, it is necessary to comply with a number of formalities and legal requirements to ensure that the entire process is carried out in accordance with Danish regulations.
1. Verification of liabilities - Verify that the company has no outstanding debts to employees, customers, authorities and suppliers.
2. Decide to wind up the business - The final decision to liquidate the business must be officially approved by the owner in the case of a sole proprietorship, or all partners in the case of a company.
3. Notify the relevant authorities - Inform the Danish authorities of the decision to close the business, including the Central Registry (CVR) and the Tax Authority (SKAT).
4. Report liquidation to Erhvervsstyrelsen - Danish companies are required to report in the event of liquidation to the Danish Enterprise Authority, which can be done online at their website.
5. Carry out the liquidation process - For companies, the liquidation procedure consists of drawing up a liquidation balance sheet for the company in question, optionally conducting a liquidation audit and distributing the company's assets that remain after all liabilities have been paid.
6. Report the closure of the business - Once the entire liquidation process for the company has been completed, report the official termination of the business to the Erhvervsstyrelsen office.
7. Archiving your business documents - According to regulations in Denmark, you are required to keep all documents related to your business for a certain period of time (usually 5 years).
Additional steps that can be taken:
- Contacting your business partners, suppliers and customers and informing them of the fact that your business is closing.
- Closing the company's bank account.
There are many reasons why a company may close down. The variety of reasons for closing a company is significant, but they can be generalized and classified into several main categories. Among them are voluntary termination by shareholders, restructuring, liquidation of the company based on shareholders' declarations, bankruptcy initiated by the company or a creditor, and forced liquidation ordered by a court.
Termination of a company by voluntary closure of the company by the partners is possible only if the company is solvent, meaning that the total amount of assets it has accumulated exceeds the liabilities of the company in question. Such a company must announce its decision to liquidate in a public manner, providing creditors with at least three months to file claims against it.
One way to avoid bankruptcy proceedings is to decide to restructure. In such a case, the court appoints a person responsible for overseeing the restructuring process, who is formally called a restructurer.
When a company is closed on the basis of a shareholders' declaration, there is no obligation to wait three months for creditors to file claims. Nonetheless, it is important that all obligations are carefully fulfilled, as neglecting any formalities can lead to a debt that will have to be paid by the shareholders. For this reason, it is crucial that all formalities are completed and the company's taxes and liabilities are paid.
Lack of liquidity is the main reason for declaring bankruptcy for companies. Before a company's bankruptcy is officially declared, it is necessary to initiate legal proceedings. A bankruptcy petition can be filed either by a creditor of the company or by the company itself.
The decision to close a company without the participation of its owner in the vast majority of cases is the result of court orders. Such a state of affairs can be caused by:
- failure to conduct a mandatory audit due to the resignation of the auditor and, at the same time, failure to appoint another,
- failure to submit the company's annual report on time,
- resignation of the Managing Director.
If the company is dissolved by court judgment, a liquidator is appointed by the court. His duty is to objectively assess the financial situation of the company. If the company is found to be insolvent, bankruptcy proceedings will be initiated. If the company remains liquid, it will merely be closed down.
We will take care of all the key steps for both a company and a sole proprietorship. This includes:
1. Submitting the closing form
Formally terminate the business and obtain an official closing certificate. This may later be required in the future, for example by an unemployment insurance fund or bank.
2. Settlement of tax liabilities
Before closing the business, you need to settle all taxes, payroll, excise, VAT, payroll, and any other taxes to the Danish state. It is important that reports for all periods up to the closing date are filed on time, as delays can cost up to DKK 800. It is also necessary to submit a final report, even if it is 0 DKK for the period.
3. Verify the company's tax account
Before closing a business, it is important to check the status of reports and payments on Skattekonto. There you can verify that everything is in order, which will help you avoid problems with payments, such as VAT or A-skat, once the company is closed.
4. Adjusting the advance tax return
Once the company has ceased operations, it is necessary to correct the profit in the tax return of the company in question in order to properly calculate and pay tax.
5. Filing oplysningskema and preparing skatteregnskab
Before closing the company, it is necessary to calculate the profit and loss and prepare the tax return for the period from January 1 to the date of closure of the company. The profit and loss balance sheet must take into account all items that have been taken out of the company or sold, such as machinery, cars, computers, furniture or inventory. Oplysningskema can only be declared in the year following the closure of the business, and the deadline for filing is July 1. Delay in filing the declaration carries a penalty of 200 kr. for each day of delay, up to a maximum of 5,000 kr.
6. Continuing to have access to company digital mail after company closure
When a company is shut down, NemID is deactivated, meaning that access to Digital Post is lost. Nonetheless, messages can continue to arrive on the company's Digital Post. In order to continue to have access to the company's digital post after the company's closure, access must be properly configured before the company's closure.