Liquidity Measures
Compensation for fixed expenses
Government Measure
All companies, regardless of industry, corporate form etc., can apply for compensation for certain fixed expenses (e.g. housing rent, leasing fees, binding obligations).
The maximum compensation is DKK 110m per company in the period from 9 March to 8 July 2020. The compensation percentage varies from 25-80% depending on the expected decrease in revenue.
If your business is closed due to mandatory rules and not had any revenue from 9 March to 8 July 2020, you will be entitled to 100% compensation
Eligibility
The following requirements apply:
- The expected decline of revenue in Denmark due to COVID-19 is more than 35%; and
- The fixed expenses amount to at least DKK 12.5k in the period from 9 March to 8 July 2020.
Supervising Authority
The Danish Business Authority
Applications are to be submitted digitally to the Danish Business Authority here from 8 April 2020.
Further guidance and instructions about the measure and application process is available here.
Availability
From 9 March 2020 to 8 July 2020
Compensation for cancelled or postponed events
Government Measure
Organizers that have cancelled (or significantly changed) a “big” arrangement due to the COVID-19 can seek compensation from the Danish Government.
The compensation is based on the organizer’s actual loss (no upper or lower limit for compensation applies).
“Big” arrangements are defined as arrangements with 1,000 (or more) participants or arrangements with 500 (or more) participants if the arrangements targeted participants at high risk of being infected by the COVID-19 (elderly people, pregnant etc.).
Eligibility
The following requirements apply:
- The arrangement was scheduled in the period from 6 March 2020 to 9 June 2020 and was to be held in Denmark;
- The arrangement was open to the public and was only to take place one or a few times in the period covered;
- The organizer’s insurance does not cover the loss / expenses;
- The expenses have de facto been paid by the organizer (or the organizer is obliged to pay the expenses, i.e. it cannot reduce its loss by cancelling supplier contracts or similar); and
- If the organizer seeks compensation for cancelled arrangements, the organizer shall refrain from invoking “force majeure” against its suppliers, customers etc.
Supervising Authority
The Danish Business Authority
Applications may be submitted digitally to the Danish Business Authority by following this link.
if an organizer seeks compensation for more than DKK 500k an auditor’s statement regarding the loss must be submitted to the Danish Business Authority when applying for compensation.
Further guidance about the measure is available here.
Availability
From 6 March 2020 to 9 June 2020
Government guaranteed loans
Government Measure
Companies with a Danish company registration number can apply for government guaranteed loans.
Two different schemes apply: one targeting small and medium-sized companies and one targeting large companies. The coverage and costs of the guarantee vary for the two different schemes.
On 19 April 2020, the Danish Parliament agreed that the Danish Fund for Industrial Growth (in Danish: Vækstfonden) can offer “match financing arrangements” to entrepreneurs and venture capital companies, whereby the Danish Fund for Industrial Growth will provide financing together with private investors typically in the ratio 1:3. We can provide further information regarding the new match facilities upon request.
Eligibility
The following requirement applies to the government guaranteed loans:
- The expected decline of revenue in Denmark due to COVID-19 is more than 30%.
Supervising Authority
The Danish Fund for Industrial Growth (in Danish: Vækstfonden)
Companies can, in cooperation with their bank or leasing company, apply the Danish Fund for Industrial Growth to use the guarantee scheme.
Companies can reach out to the Danish Fund for Industrial Growth directly to apply for the match financing arrangements.
Further guidance about the measure is available here and here.
An overview of Vækstfonden's products for entrepreneurs and venture companies, which have been affected by COVID-19, can be downloaded here (in English).
Availability
From 18 March 2020
EKF Danmarks Eksportkredit (“EKF”)
Government Measure
EKF is in the process of adopting two new measures in favor of export companies that are affected by the COVID-19.
Measure 1: EKF will provide guarantees for small and medium-sized companies’ new bank loans covering 80% of the banks’ losses, if any. EKF expects that the measure will be made available to 250 companies with a total loan amount of DKK 1.25b.
Measure 2: EKF will extend its existing reinsurance scheme to include OECD countries, in order to ensure that COVID-19 does not deter private credit insurers from insuring Danish export companies’ export orders. EKF will cover up to 90% of the credit insurers’ risk on new export orders.
Eligibility
The following requirement apply for measure 1:
- The expected decline of revenue due to COVID-19 has resulted or is expected to result in a revenue loss of at least 30%.
Supervising Authority
EKF Danmarks Eksportkredit
Both measures await approval from the EU Commission according to the state aid rules. The public hearing of the measures ended on 25 March 2020, thus we expect that the EU Commission will publish its decision shortly.
Further information regarding the measures and the application process will follow when the information is made available by EKF.
Further information about the measure is available here.
Availability
Not available yet
Payment of tax and VAT
Government Measure
Deadlines for payment of Labour Market Contributions and A tax for the periods April, May and June are extended by four months. The extension of the deadlines applies only to the payment of Labour Market Contributions and A tax and not the notification to the Danish Tax Authorities through “eIndkomst”.
The deadlines for payment of B-tax for the period April and May are extended by two months.
For small and medium-sized companies, the VAT and duty periods for the first and second quarters and the first and second half-years are combined in terms of payment and notification. The deadlines for payment and notification of VAT and duties for the period April, May and June are extended by one month.
On 19 April 2020, the Danish Parliament agreed to postpone the deadline for payment of payroll taxes paid by “metode 4-selskaber” (e.g. dentists, occupational therapists and haulers) by 6 weeks for the second quarter of 2020 and 4 weeks for the third quarter of 2020.
Eligibility
No requirements apply.
Supervising Authority
The Danish Tax Authority
No application is necessary.
Further guidance about the measure is available here and here.
Availability
April, May and June 2020 (VAT and tax) and second and third quarter of 2020 (payroll taxes)
Energy taxes
Government Measure
Companies that usually have annual reimbursements above DKK 30,000 can apply for monthly reimbursements.
Eligibility
No requirements apply.
Supervising Authority
The Danish Tax Authority
Applications may be submitted digitally to the Danish Business Authority here.
Further guidance about the measure is available here.
Availability
April, May and June 2020
Advance payments and flexibility from state institutions
Government Measure
The Danish Parliament has agreed upon three concrete initiatives in order to support companies that are trading with Danish public authorities. The three initiatives are:
- Prepayments to the private companies that have already delivered its services/goods to a public authority;
- Payment in advance to the private companies that are to deliver services/goods to a public authority (it will be possible for public authorities to make prepayment for orders with a value of maximum DKK 1m and with delivery before 2 July 2020); and
- Refrain from claiming penalties even though a private supplier is in violation of the agreement.
Eligibility
No requirements apply.
Supervising Authority
The Ministry of Finance
Companies must contact the relevant public authority to obtain the benefit.
Further guidance about the measure is available here.
Availability
From 18 March 2020
Refund of paid VAT and payroll taxes as interest free loans
Government Measure
The Danish government has proposed that:
- small and medium-sized companies that prior to 2 March 2020 have paid VAT for the second half of 2019 or fourth quarter of 2019, as applicable, will be able to have the amount repaid as an interest-free loan, and
- payroll taxes paid by “metode 4-selskaber” (e.g. dentists, occupational therapists and haulers) for the first quarter of 2020 and 25% of the payroll tax for profits for the 2019 income year can be paid as an interest-free loan.
The loans shall be repaid no later than 1 April 2021.
Supervising Authority
Not yet adopted by the Danish Parliament.
Further information is available here.
Availability
Not available yet