Denmark Tax Agency Clarifies Corporate Tax, PE Implications of Offshore Sand Dredging, Related Transport Activities

The Danish Customs and Tax Administration March 4 posted Tax Council Binding Answer Nos. SKM2026.120.SR and SKM2026.121.SR, clarifying the corporate tax and permanent establishment (PE) implications of offshore sand dredging and related transport activities. The taxpayers, Netherlands-based companies, carried out short-term sand suction campaigns, delivered the specified material to Danish ports, and sought clarification on whether the work created a PE or Danish limited tax liability. The Tax Agency concluded that the specified corporate and hydrocarbon tax rules didn’t apply. Upon review, the Tax Council upheld the Tax Agency’s decision, finding that: 1) the taxpayers conducted the sand suction outside ...