Guide to m&a tax 2022

a. General Comments
Generally, many deals (for example acquisitions of real estate) are carried out as a sale of shares instead of an actual asset sale. A share acquisition of all shares means 
that the buyer acquires the entire company.
An acquisition of shares is not a taxable event for the target company, (i.e. there is no taxation of the target’s underlying assets). Sales of shares are not subject to any 
stamp duties or transfer taxes.
There are no immediate Danish tax consequences for a foreign company that acquires the shares of a Danish company.
In general, the tax position of the acquired Danish target company remains unchanged (apart from the restriction on carry forward of losses, which on a change of 
ownership may become restricted, see section 3.b. below).
For the seller, acquisitions of shares are covered by the rules on taxation of capital gains from sale of shares (the Danish Act on Taxation of Capital Gains on Sale of 
Shares). This is the case when partially selling some of the shares and in the case of a sale of all shares in a company.
The Danish Tax Authorities may choose to reassess tax returns both for the purpose of increasing or decreasing the target’s taxes under the ordinary deadline until 1 
May in the fourth year after the relevant income year (additional two years for controlled transactions).
From a buyer’s perspective:
• 
In general, acquisitions of shares are considered less buyer friendly than acquisitions of assets.
• 
The buyer acquires, among other things, target’s tax assets and liabilities (deferred taxes etc.). The buyer should therefore be aware of any possible historical tax 
risks, that the buyer may acquire along with the shares.
From a seller’s perspective:
• 
As opposed to the buyer, the seller should be aware that any possible tax assets are transferred to the buyer in the acquisition and will therefore not benefit the 
seller, e.g. if the target’s tax return from a previous income year is reassessed after the acquisition and it turns out that target is entitled to a tax refund.
• 
Acquiring shares are covered by the rules on capital gains from the sale of shares meaning that gains are taxable, and losses are deductible for the seller. However, 
aside from commercial shares, the capital gains from the seller’s own shares, group shares, subsidiary shares or from tax exempt portfolio shares exempt from tax. 
Thus, an acquisition of shares within a group should not have any adverse tax consequences for the seller.
• 
The seller should however be aware that different anti-avoidance rules may lead to a requalification of tax exempt capital gains to taxable dividends (especially 
if foreign shareholders are involved).
7 
Denmark
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TAXAND GLOBAL GUIDE TO M&A TAX 2022