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5.4. Tax Base for Non-Resident Entities

Non-resident companies with a branch or PE in Denmark are subject to tax on income attributable to the Danish branch/PE. The latter is assessed to tax in much the same way as a resident company. Hence, for example, loss-carry forward is available to the branch/PE but the cancellation of loss-carry forward as a result of a change of ownership of the foreign enterprise would apply to the branch/PE as it would have applied to a resident enterprise in similar circumstances.

Furthermore, a non-resident company is subject to tax on income derived from Danish immovable property.

With respect to offshore activities on the Danish continental shelf, the situation depends on whether or not there is a treaty between Denmark and the country of the non-resident company. Where there is no treaty, Denmark considers that income from such activities is taxable in Denmark regardless of whether or not the activities represent a PE. Where a treaty applies and covers the continental shelf as part of Danish territory, activities on the continental shelf are taxable in Denmark only if constitutive of a PE under the relevant treaty. Where the treaty does not cover the continental shelf, income from such activities is taxable in Denmark regardless of whether or not the activities constitute a PE.

Non-residents without a branch or PE in Denmark are taxable only on specified Danish-source income including income from Danish immovable property and from activities on the Danish continental shelf (see above).