1. Introduction to Denmark’s Bookkeeping and SAF-T Requirements
Denmark introduced the Standard Audit File for Tax (SAF-T) reporting under its Bookkeeping Act in July 2022. The requirement mandates businesses to digitally report their tax and financial data to Denmark’s tax authority, SKAT, in a standardized electronic format, enhancing transparency and compliance.
1.1 Purpose and Scope of SAF-T in Denmark
The Danish Business Authority (Erhvervsstyrelsen) oversees SAF-T, aligning with the OECD SAF-T version 2 model. Denmark joins 12 other countries in adopting this international format to streamline financial audits, facilitate data exchanges, and reduce tax evasion.
2. Entities Under the Scope of SAF-T Legislation
All businesses that are legally obliged to maintain bookkeeping systems are subject to SAF-T requirements. Importantly, Denmark employs a demand-based approach, meaning that companies are only required to submit SAF-T files upon explicit request from the tax authorities.
3. Implementation Timeline for Digital Bookkeeping
Denmark is implementing digital bookkeeping in several phases:
3.1 Initial Phases of Compliance
- 1 February 2023: Digital standard accounting system requirements became mandatory.
- 31 October 2023: Registration deadline for providers of standard bookkeeping systems.
- 1 January 2024: A public list of approved digital accounting systems is published by the Danish Business Authority.
3.2 Mandatory Digital Bookkeeping for Companies
- 1 July 2024: Companies submitting annual reports under the Danish Financial Statements Act must adopt digital accounting, based on their financial year start date (e.g., 1 July 2024, 1 January 2025, or 1 April 2025).
- 1 January 2025: Companies using customized bookkeeping solutions, such as public limited companies, limited partnerships, private limited companies, commercial foundations, and similar entities, must digitize their bookkeeping.
- January 2026: Sole proprietorships, partnerships, and financial companies with turnover exceeding DKK 300,000 in the two preceding income years (2024 and 2025) must adopt digital bookkeeping.
4. Submission Methods and Frequency for SAF-T
4.1 SAF-T Submission Channels
When requested, businesses must submit SAF-T files through official channels such as TastSelv Erhverv, SKAT’s official self-service portal. Alternative methods include integration via web services (REST APIs) or secure FTP gateways, which facilitate direct electronic submissions. Additionally, SKAT offers a validation service, allowing businesses to test files in a sandbox environment prior to actual submission.
4.2 Accessing the Submission Portal
Businesses can log into TastSelv Erhverv using:
- MitID
- Personal MitID for businesses
- E-tax password (self-key)
4.3 Frequency of SAF-T Submission
Submission frequency is demand-driven. Businesses must submit files as instructed by tax authorities, with deadlines provided in each specific request.
5. Technical Specifications and SAF-T Structure
5.1 Structure of Danish SAF-T Schema
SAF-T files in Denmark include:
- Header (mandatory)
- Master File (optional, expected mandatory)
- General Ledger accounts (optional, expected mandatory)
- Source Documents (optional, expected mandatory)
The Danish Tax Agency highlights a discrepancy in the current technical description, emphasizing that future updates will mandate comprehensive data, including master data and general ledger accounts, to facilitate data transfers between systems effectively.
5.2 SAF-T Format and Validation
- Denmark’s SAF-T files follow the OECD SAF-T V.2 XML format.
- Currently, no file-splitting rules are defined.
- Authorities may request additional documents for comprehensive audits, suggesting current files alone are not sufficient.
6. Key Authentication and Procedural Points for SAF-T Submission
- Official Portals: SAF-T files must be submitted via authorized portals such as TastSelv Erhverv (skat.dk) or Virk.dk. Submissions via email are not accepted.
- Authentication Requirements: Login via MitID/NemID or equivalent verified business credentials.
- Automated Submission: Systems integrating via API or SFTP require authentication using trusted certificates or tokens provided by SKAT.
- XML Format and Encoding: Compliance requires using the official XML schema (Danish SAF-T Financial Data, version 1.0) and the recommended standard chart of accounts (Standardkontoplan) mappings for accuracy.
7. Implications and Recommended Actions for Businesses
Businesses operating in Denmark must proactively prepare by:
- Reviewing and updating existing accounting systems to comply with upcoming mandatory components.
- Monitoring regulatory updates from the Danish Business Authority and SKAT.
- Utilizing available validation services to minimize submission errors.
Early compliance ensures efficient management of digital tax reporting obligations and reduces operational disruptions, positioning businesses for smoother audits and improved regulatory alignment.
What is SAF-T Reporting in Denmark?
The Standard Audit File for Tax in Denmark (SAF-T Denmark) is an internationally recognized electronic reporting format designed to facilitate the exchange of financial data between businesses and tax authorities. Denmark has integrated SAF-T Denmark as part of its digital bookkeeping framework, ensuring accurate tax reporting and financial transparency. This initiative aligns with Denmark’s broader goal of digitizing business processes and improving compliance with tax regulations through SAF-T Denmark standards.
When Was SAF-T Introduced in Denmark?
Denmark implemented Denmark SAF-T reporting as part of its Bookkeeping Act in July 2022, with a phased rollout:
- February 1, 2023: Digital standard accounting system requirements became mandatory.
- July 1, 2024: Companies using registered bookkeeping systems under the Danish Financial Statements Act must comply with SAF-T Denmark digital bookkeeping requirements.
- January 1, 2025: Companies using non-registered bookkeeping systems must transition to SAF-T Denmark digital bookkeeping.
- 2026: Personally owned companies with annual turnover exceeding DKK 300,000 over two consecutive years must adhere to SAF-T Denmark digital bookkeeping regulations.
SAF-T Deadlines in Denmark
Denmark follows an on-demand approach for Standart Audit File Tax in Denmark submissions. There are no periodic reporting deadlines, but businesses must be prepared to submit SAF-T Denmark files upon request from the Danish tax authorities. Companies must maintain accurate and structured financial records to generate SAF-T Denmark files efficiently when required.
Is SAF-T Mandatory in Denmark?
Yes, SAF-T Denmark compliance is mandatory for businesses falling under the Danish Bookkeeping Act. Although companies are not required to submit SAF-T Denmark reports regularly, they must ensure their digital bookkeeping systems can generate SAF-T-compliant files whenever requested. Failure to provide SAF-T Denmark data when required can lead to penalties or compliance issues.
SAF-T Requirements in Denmark
Denmark’s SAF-T structure follows the OECD SAF-T version 2 model and consists of several key elements:
- Header – Contains essential metadata about the SAF-T Denmark file.
- Master File – Includes company details, customer and supplier records, and the chart of accounts.
- General Ledger Accounts – Covers all financial transactions recorded in the general ledger.
- Source Documents – Provides detailed data on sales, purchases, payments, and inventory movements.
All SAF-T Denmark files must be formatted in XML, ensuring consistency and compatibility with Denmark’s digital bookkeeping standards. Businesses must ensure their accounting software can generate SAF-T Denmark reports in the required format.
SAF-T Declaration in Denmark
Businesses do not need to submit SAF-T Denmark files periodically, but they must be ready to provide them upon request from tax authorities. When a request is made, the SAF-T Denmark file must be submitted promptly through the official online platforms used for tax reporting. Companies should maintain accurate, up-to-date, and structured financial records to avoid delays in SAF-T Denmark compliance.
What Companies Must Declare SAF-T in Denmark?
SAF-T Denmark compliance applies to all businesses required to maintain bookkeeping records under Danish regulations, including:
- Medium and Large Enterprises – Companies submitting annual reports under the Danish Financial Statements Act.
- Small Businesses – Personally owned companies with annual turnovers exceeding DKK 300,000 for two consecutive years.
- Foreign Companies – Businesses with a taxable presence in Denmark.
Companies must ensure their digital bookkeeping systems comply with SAF-T Denmark requirements to avoid potential penalties and ensure smooth tax reporting processes.
Denmark’s integration of SAF-T Denmark into its digital bookkeeping framework enhances financial transparency and streamlines tax compliance. While regular submissions are not required, businesses must ensure they can generate SAF-T Denmark-compliant files upon request. By maintaining accurate records and adopting digital accounting systems, businesses can effectively meet Denmark’s Standard Audit File Tax in Denmark reporting standards and regulatory expectations.