Denmark Modernizes Its Bookkeeping Act to Promote the Digitalization of Accounting

Denmark Bookkeeping Act

Last May, the Danish parliament passed a package of reforms affecting the Danish Bookkeeping Act (Act no. 700 of May 24, 2022), which replaces the previous act that had been in force since 1999. The main objective remains to strengthen the fight against tax fraud and increase the degree of digitalization of Danish companies' accounting records.

The new Bookkeeping Act comes into force as of July 1, 2022, but the obligation regarding digital accounting and archiving will be implemented over the next few years. All companies, regardless of size, must submit an annual report to the Danish Business Authority ERST (Erhvervsstyrelsen) and fall within the scope of the new requirements. The next dates to be confirmed depending on the size and revenue of the companies are:

  • January 1, 2024: Companies that are required to submit annual reports to the Danish authorities must file them using the digital accounting system.
  • January 1, 2026: Other companies and associations with an annual net turnover exceeding DKK 300,000 (about €40,000) for two consecutive years must file using the digital accounting system.

One of the most significant changes in the new act is the requirement to digitize accounting. In addition, a publicly approved digital accounting system that meets several requirements defined by the Danish government through an executive order must be used. The Danish government will soon provide more information about this so that digital providers can become certified.

e-Invoicing in Denmark

Since 2005, it has been mandatory for both Danish government authorities and their suppliers to use e-Invoices in the Peppol BIS 3.0 format via the Peppol network, thereby connecting with public entities registered in the national SMP NemHandel.

Denmark is also considering implementing electronic ordering and cataloging for specific categories of goods, thus encouraging the use of e-commerce in the public sector.

In the B2B sector, companies have the freedom to use e-Invoicing as long as they both agree to do so.

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