Nalunaarsuineq · Greenlandic

Annual Compliance and Reporting for a Greenlandic Company

A practical guide for foreign founders on the annual compliance and reporting obligations for a Greenlandic company, including filing deadlines, tax returns, and best practices to maintain good standing.

Introduction

For foreign founders establishing a company in Greenland, understanding the annual compliance and reporting requirements is essential to maintain good standing and avoid penalties. This article outlines the key obligations for a Greenlandic company, focusing on annual reports, tax filings, and other recurring duties. It is intended as general information for entrepreneurs and should not be relied upon as legal or tax advice.

Corporate Annual Reporting

Greenlandic companies are subject to annual reporting requirements under the Greenlandic Companies Act (Aktieselskabsloven). The specific obligations depend on the company form, typically an aktieselskab (A/S) or an anpartsselskab (ApS).

Annual Report (Årsrapport)

All companies must prepare and file an annual report with the Greenlandic Business Authority (Erhvervsstyrelsen) within six months of the end of the financial year. The report typically includes:

• Financial statements (balance sheet, income statement, notes)
• Management commentary (ledelsesberetning)
• Auditor's report, if required based on company size
• Statement of corporate governance, if applicable

Small companies may be exempt from audit, but the annual report must still be filed. The financial year generally follows the calendar year, but companies can choose a different fiscal year.

Confirmation Statement (Erklæring)

Companies must also file an annual confirmation statement confirming that the information in the company register is correct. This includes details of management, share capital, and ownership. The confirmation statement is typically filed in conjunction with the annual report.

Tax Compliance

Greenland has its own tax system, separate from Denmark. Companies are subject to corporate income tax, and must comply with annual tax filing requirements.

Corporate Income Tax Return

Companies must file an annual corporate income tax return (selskabsselvangivelse) with the Greenlandic Tax Agency (Skattestyrelsen). The deadline is generally six months after the end of the financial year. The tax rate for companies is 25% (as of 2024). Advance tax payments (acontoskat) may be required during the year.

VAT (Moms)

Companies registered for VAT must file periodic VAT returns, typically quarterly or monthly, depending on turnover. The deadline is usually the last day of the month following the end of the reporting period. Late filing may result in penalties.

Withholding Taxes

Companies must withhold and report taxes on wages (A-skat) and other payments, such as dividends and royalties to non-residents. These are reported monthly to the tax authorities.

Other Annual Obligations

Registered Office and Contact Information

Companies must maintain a registered office in Greenland and ensure that contact information is up to date with the Business Authority. Changes must be reported promptly.

Beneficial Ownership Register

Companies are required to maintain a beneficial ownership register and file it with the authorities. Updates must be made within specified deadlines when changes occur.

Employment Reporting

If the company employs staff, it must comply with reporting obligations related to pensions, social security, and labor market contributions. These are typically reported monthly or quarterly.

Deadlines and Penalties

Missing deadlines can lead to fines and, in severe cases, compulsory dissolution. It is crucial to track the following key dates:

• Annual report: Within 6 months of financial year-end
• Corporate tax return: Within 6 months of financial year-end
• VAT returns: Quarterly or monthly, depending on registration
• Withholding tax: Monthly

Penalties vary but can include daily fines for late filing of annual reports.

Practical Tips for Foreign Founders

• Engage a local accountant: Greenlandic tax and company law are specialized; a local advisor can help ensure compliance.
• Maintain proper records: Keep accurate accounting records to support annual reports and tax filings.
• Use digital filing systems: The Greenlandic authorities provide online portals for filing; familiarize yourself with these.
• Plan for audits: If your company exceeds certain size thresholds, an audit may be mandatory; budget for this early.

Conclusion

Annual compliance for a Greenlandic company involves timely filing of annual reports, tax returns, and other statutory documents. By understanding these obligations and seeking local expertise, foreign founders can focus on growing their business while maintaining good standing with the authorities.

Disclaimer: This article provides general information only and does not constitute legal, tax, or professional advice. Requirements may change, and the specific obligations depend on your company's circumstances. You should consult with qualified local advisors for guidance tailored to your situation.