A certificate of residency is an official document issued by the Danish Tax Agency confirming that an individual or a company is tax resident in Denmark. The certificate is often used as documentation for foreign tax authorities or in connection with double taxation treaties.
The purpose is to determine which country has the right to tax your income and thereby avoid you paying tax twice on the same income.
Frequently Asked Questions About Certificates of residency
What is a certificate of residency?
A certificate of residency is an official document issued by the Danish Tax Agency confirming that an individual or a company is tax resident in Denmark.
The certificate is often used as documentation for foreign tax authorities or in connection with double taxation treaties to determine which country has the right to tax your income and to avoid double taxation.
Who can apply for a certificate of residency?
Both individuals and entities can apply for a certificate of residency from the Danish Tax Agency.
- Individuals: Use form 02.050, which documents that you are fully tax liable in Denmark.
- Companies, foundations and associations: Use form 02.042, or form 02.042A if there is no double taxation treaty with the relevant country.
- Sole proprietorships: Use form 02.034, or form 02.034A if there is no double taxation treaty with the relevant country.
The correct form depends on whether there is a double taxation agreement between Denmark and the country where the certificate will be used.
When do you need a certificate of residency?
You typically need a certificate of residency when Danish tax residence must be documented to foreign authorities. This may be relevant if you:
- Work abroad
- Own property abroad
- Receive income from abroad
- Run a business with international activities
The certificate is also used in cases of dual residence, where a person or company may be considered resident in two countries. In such cases, the certificate helps determine which country has the primary taxing right.
Where do you find the forms for a certificate of residency?
The forms are available on the Danish Tax Agency’s website under Forms → 02 Tax: Attestations.
The applicant fills in the personal or company details and submits the form digitally to the Danish Tax Agency. It is important that all information is correct, as incomplete forms may be returned without stamp and signature.
Once the Danish Tax Agency has processed the application, you receive a certified certificate that can be presented to foreign authorities.
What does tax residence mean?
Tax residence (tax domicile) is the country in which a person or company is considered resident and therefore tax liable.
For individuals, this depends, in order of priority, on:
- Where you have your home
- Where you stay
- The centre of your economic and family interests
- Nationality
For companies, it is typically about where management is located or from where the business is actually managed.
Why is a certificate of residency important?
A certificate of residency is important for both individuals and companies with international relations. It serves as legal documentation that you are tax resident in Denmark and can help ensure that your income is only taxed in one country.
The certificate is also used as the basis for obtaining reduced withholding tax or exemption from foreign withholding tax under applicable double taxation treaties.
Lack of documentation can lead to double taxation or delays in payments and refunds.
How do you complete and submit the certificate correctly?
It is crucial that the certificate is completed correctly and that all relevant information is included. The Danish Tax Agency may reject or return applications that contain errors.
You should keep a copy of both the submitted form and the receipt for submission.
If you have complex circumstances – for example residence in several countries, work abroad or investments in foreign companies – you should seek professional tax advice to ensure correct handling. SkatteInform can assist with this.
Which form should you use if there is no double taxation treaty?
If there is no double taxation treaty between Denmark and the other country, special versions of the forms must be used:
- Companies, foundations and associations: form 02.042A
- Sole proprietorships: form 02.034A
SkatteInform can help assess which form is correct in your situation and how it should be completed.
How long is a certificate of residency valid?
A certificate of residency is only valid as long as the underlying information is correct.
If you move abroad, change residence, start a business in another country or change your management structure, you should immediately apply for a new certificate.
For companies, an update may also be necessary in connection with group changes, relocation of management or establishment of foreign subsidiaries, so that the documentation always reflects the actual tax situation.
Why should I seek professional advice regarding certificates of residency?
Incorrect handling of tax residence can lead to double taxation, denial of treaty benefits and delays in refunds.
At SkatteInform we help individuals and companies with international relations to:
- Clarify tax residence
- Choose and complete the correct forms
- Document tax residence for foreign authorities
- Apply double taxation treaties correctly
Disclaimer
As the above is for guidance purposes only, we accept no liability for decisions that may be made based on the above without prior individual advice. We accept no liability for errors and omissions.