On 24 August 2015, the Danish Tax Authorities (DTA) filed their first report with the Danish Public Prosecutor for Serious Economic Crime (SEC) on suspected fraud with Danish dividend withholding tax reclaims of approx. DKK 6.2bn (approx. EUR 0.8bn). As the investigation continued, it became clear that the fraudulent amount was much higher than initially assessed. In November the DTA announced that they had filed a follow-up report with the SEC on fraud in the amount of DKK 2.9bn (approx. EUR 0.4bn). The total suspected fraudulent amount thereby exceeds DKK 9bn (approx. EUR 1.2bn).
The DTA’s preliminary investigation showed that the fraud presumably involves companies reclaiming withholding tax on dividends on Danish shares which such companies had untruthfully and fictitiously stated that they owned. Allegedly, the documentation provided to the DTA as a basis for the reclaims was falsified, but the factual circumstances currently disclosed are very scarce.
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Based on the information disclosed by the Danish Tax Ministry so far, there is no indication that this issue concerns any misinterpretation of current Danish tax law or even an attempt of stretching the current interpretation of Danish tax law. It simply appears that this is solely an issue of criminal fraud of reclaims of Danish dividend withholding tax.
