Denmark – Interest on VAT corrections from 1st July 2023

From the 1st July 2023, the Danish tax authorities will charge interest of 0.7% per month (8.4% per annum) on VAT corrections; underpayment of VAT or over claim of input VAT. The interest accrues from the day after the submission deadline of the relevant VAT return.

By default the Danish tax authorities can go back three years when assessing the interest to be imposed, which could result in an underpayment that is three years old being subject to interest at 28.5% (0.7% per month). Corrections made prior the 1st July 2023 are not affected by this change.

Additionally in principal the Danish Authorities can impose a penalty of DKK 800 for failing to submit a VAT declaration, or for the late submission of a VAT declaration.