Denmark Tax Agency Clarifies Extraordinary Change of Tax Liability

The Danish Customs and Tax Administration Jan. 19 posted National Tax Court Decision No. SKM2026.38.LSR, clarifying extraordinary changes of tax liability. The taxpayer, a resident airline operating domestic and international flights, used a fixed standard percentage to reduce input VAT on shared costs, despite annually calculating materially different pro rata rates under the Danish VAT Act. The taxpayer also incorrectly claimed full deductions for energy taxes that were expressly prohibited for companies subject to the VAT Act. The Tax Agency found that the taxpayer acted negligently by using incorrect percentages and failing to perform mandatory year-end VAT adjustments, thereby understating ...