Am I allowed to start my own business in Denmark?
Yes — you can start a sole proprietorship and get a CVR number free on virk.dk. You must register for VAT if turnover exceeds 50,000 kr within 12 months, and the registration must be done at least 8 days before you start VAT-liable activity. The VAT rate is 25%, while certain sectors such as health and education are VAT-exempt. Below 50,000 kr you can skip VAT registration or start an even simpler small-business form. What people overlook is the liability: in a sole proprietorship you are personally and unlimitedly liable for all debt — there is no wall between the business and your private finances. The profit is taxed as personal income (B-tax), and you can opt into the business scheme.
📋 The rules
- A CVR for a sole proprietorship is free
- VAT registration if turnover over 50,000 kr
- Register at least 8 days before VAT-liable activity
- The VAT rate is 25%
- You are personally liable for all debt
🔓 Exceptions
- Below 50,000 kr you can skip VAT registration or register voluntarily
- A small-business form is an even simpler option for turnover under 50,000 kr
- Certain sectors such as health and education are VAT-exempt
⚠️ Penalties & fines
If you run a VAT-liable business without registering, the tax authority can demand back-VAT plus interest and a fine, and deliberate evasion can be prosecuted. The bill lands on you: the 25% is owed on turnover you have already taken, and it can rarely be collected from the customers afterwards. The bigger consequence, though, is not tax. In a sole proprietorship you are personally and unlimitedly liable for all debt, so creditors can go after your savings and personal assets if the business cannot pay its way.
📎 Official sources
❓ Frequently asked
Can I start my own business?
Yes. You can register a sole proprietorship and get a CVR number free on virk.dk, where the Business Authority runs the register. Setting the business up therefore costs you nothing at all.
When must I register for VAT?
When turnover exceeds 50,000 kr within 12 months. Registration must be done at least 8 days before you start VAT-liable activity, and the rate is 25% — though sectors like health and education are exempt.
Am I personally liable?
Yes. In a sole proprietorship you are personally and unlimitedly liable for all business debt. There is no separation between private and business finances, so creditors can go after your personal assets.
What if turnover is under 50,000 kr?
Then you can skip VAT registration, or you can choose to register voluntarily. Alternatively you can start the simpler small-business form, which exists for turnover under 50,000 kr a year.
How is the profit taxed?
As personal income via B-tax, so it is taxed together with your other personal income. You can also opt into the business scheme, which offers other ways to optimise the tax on the profit.
🔎 Common searches
What people search to land here:
- “can I start a business denmark”
- “cvr sole proprietorship free”
- “vat registration 50000 kr”
- “personally liable business”
- “small business form”
- “b-tax self-employed”