All businesses have been assigned a tax account with SKAT
The tax account was introduced from 2 September 2013 in E-tax for Businesses (TastSelv Erhverv), and businesses could subsequently see their total outstanding balances with the Danish Customs and Tax Administration (SKAT). The tax account gives a comprehensive overview of the business’ returns, reports and payments and of its debit and credit balances of VAT, payroll tax, A tax (tax deducted from income at source) and labour market contribution, corporation tax, advance corporation tax, dividend tax, excise duties and environmental taxes and charges, other taxes and duties as well as fees, charges and interest.
It should be noted that the self-employed earner cannot see his or her B tax (tax not deducted from income at source) in the system as the tax account exclusively comprises transactions made via the individual business registration (CVR) number. B tax instalments can therefore only be seen in the business owner’s personal preliminary income assessment in E-tax for Individuals.
How does the tax account work?
If the business pays earlier than five days before the final due date for payment without filing a return or having other due items in the account, the money will automatically be returned.
All amounts from the tax account will be paid into the account registered as the business’ NemKonto.
A FIFO (first-in, first-out) principle has been introduced for the business’ outstanding balances with SKAT, meaning that the oldest balances will be covered first. If a debt is owing to SKAT, a setoff will therefore be made.
Interest is calculated on the daily balance in the account. In practice, this means that day-to-day interest will be applied to the account once a month at a common rate and with compound interest. According to SKAT's website, the rate effective from 1 January 2014 is 0.8% per month, which will be adjusted next time from the end of 2016. If the business does not pay on time, interest will consequently accrue on the overdue amount. The calculated interest is not eligible for tax deduction. In case of overdue amounts in excess of DKK 5,000, a reminder will be issued to the Message File in E-tax for Businesses together with a late charge of DKK 65.
Advisers can access the business’ tax account
Business owners may authorise their auditors or advisers to access the tax account. If an adviser has previously been authorised to access E-tax for Businesses, no new authorisation is needed to give the adviser access to the tax account.
Based on our experience, we recommend businesses to reconcile the tax account regularly to avoid unpleasant surprises.