Which taxes are relevant/which transaction costs will be incurred when buying real estate as an asset (asset deal) and how are the transaction costs shared between the buyer and seller?
Profit on the sale of investment property is taxed in the same way as capital gains in Denmark. For corporate owners (resident or non-resident) the tax rate is 22% in 2025. For individuals, capital gains are taxed at a rate of up to 42%, depending on total income.
Capital gains on residential property are not taxed if the seller has used the property for his own residential purposes.
The fee for the registration of a title document is DKK 1,850 plus 0.6% of the purchase price or the public land assessment value, whichever is higher. If the real estate is residential the fee will be calculated solely on the purchase price. The parties are free to agree on the sharing of costs. Agency fees in relation to residential properties are usually between two and four per cent of the trade value of the property. Agency fees in relation to commercial property vary greatly and depend on the nature of the property.
Furthermore, the sale and purchase of real estate is — as a general rule — not subject to VAT.
However, VAT at the rate of 25% will apply to the sale of land plots and new buildings, provided the sale is carried out as part of a business activity.
A building is considered new if it is sold prior to its first occupation, or if the first sale occurs less than five years after the date of completion. A building that has been rebuilt substantially within five years of the sale for an amount exceeding 25% of the official property value plus the value of the rebuilding or the purchase price, whichever is higher, is considered a new building. The sale of development properties with existing old buildings ripe for demolition may in some circumstances be regarded as the sale of a land plot.
Certain exceptions to a sale of land plots and new buildings being subject to VAT exist, including with respect to properties constructed and used solely for VAT-free rental purposes, land plots previously used for VAT-free purposes, and sales constituting a VAT-exempt transfer of business (eg if the seller is voluntarily registered for VAT on rental of the property and the buyer is to continue the VAT-liable rental activities).
VAT is paid by the seller, and the purchase agreement will (or should) always include regulation as to whether the purchase price is inclusive or exclusive of VAT and the seller must issue a valid invoice if the sale is subject to VAT, especially in situations where it is not clear if the tax authorities will regard the transfer as subject to VAT.
The buyer generally has the right to recover VAT charged by the seller if the buyer is a VAT taxpayer carrying out transactions subject to VAT provided the acquired real estate forms part of these activities.