Newsletter | Volume 1

Issue I
Issue II
Issue III
Issue IV
Issue V
Issue VI
Issue VII
Issue VIII
Issue IX
Issue X
Issue XI
Issue XII
Issue XIII
Issue XIV
Issue XV
Issue XVI
Issue XVII
Issue XIX
Issue XX

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Denmark's largest potential tax fraud. The Danish tax authorities are taken for a ride!

For a number of years, probably from 2012 to 2015, a number of the most reputed and biggest Danish companies, such as Danske Bank, Novo Nordisk, and Vestas, have confirmed that they have been abused in the presumed tax fraud.

The Danish tax authorities have announced that they have reason to suspect that Denmark has fallen victim to an international tax fraud scheme so far amounting to DKK 6.2 billion. Danish police are investigating the matter.

The potential tax fraud involves refund of tax on dividends paid by Danish companies to certain foreign companies.

Danish companies have a duty to withhold tax on dividends distributed to their shareholders, including shareholders resident outside of Denmark. If the shareholder is resident outside of Denmark, the shareholder may - subject to fulfilment of certain requirements - be entitled to a full or partial refund of the tax withheld by the dividend-paying companies.

The Danish tax authorities suspect that a network of foreign entities has filed claims for the refund of withholding tax on dividends based on fictitious shareholdings in Danish companies. On the basis of these presumably fraudulent claims for refunds, the Danish tax authorities have made refunds to these foreign entities. It has been announced that the fraudulent requests for refunds amounts to DKK 6.2 billion, but the number may increase.

As a consequence of the presumed fraud, all filings for a refund of withholding tax on dividends have been put on hold pending further investigation.