Updated 3 April 2020
The basis of several businesses has temporarily disappeared or has been heavily reduced because of covid-19. At the same time, businesses must still pay rent and also have other overheads which must be paid although the customers stay away.
Therefore, a temporary compensation for overheads of businesses is introduced on the basis of the principles below.
Is my business entitled to apply for compensation?
All businesses, regardless of line of business, type of business organisation, etc., are entitled to apply for compensation.
You must meet the following requirements:
- You must expect that your business will see a fall in turnover of more than 35% because of corona virus/covid-19.
- Your overheads must amount to at least DKK 12,500 during the period from 9 March to 8 July 2020
Which costs can be covered?
Businesses in all lines of business can obtain compensation. The compensation scheme is based on four additional basic principles:
- The compensation is aimed at businesses with a large fall in turnover (more than 35%)
- The compensation is aimed at overheads and amounts to between 25 and 80%
- The compensation covers up to three months and will be paid as soon as possible
- If the turnover has fallen considerably less, the compensation must be paid back.
- Businesses which are affected by bans and must close, may receive a compensation of 100% of overheads.
Clarification of the scheme
Under the scheme, businesses can receive a refund of overheads which can be documented, including for example rent, interest costs and interminable contractual costs for a period (for example leasing), if the businesses experience a major reduction in turnover.
The share of the overheads which may be compensated is as follows:
- 80% – if the reduction in turnover has been 80-100%
- 50% – if the reduction in turnover has been 60-80%
- 25% – if the reduction in turnover has been 35-60%
In addition, businesses for which the government has issued a temporary ban in order to limit the infection with covid-19 will receive compensation corresponding to 100% of the overheads covered for as long as the ban remains in existence.
The costs for the state for the scheme is expected to amount to about DKK 13 billion per month, corresponding to a total cost of DKK 40 billion from 9 March 2020 to 8 July 2020.
Required documentation
The business can apply for compensation by sending a statement with audit opinion of its overheads during the past three months. The expected reduction in turnover as a consequence of covid-19 is calculated for all or parts of the period 9 March 2020 to 8 June 2020 compared with the same period in 2019.
The business confirms through a solemn declaration that the turnover has decreased. The Danish Business Authority will then pay the compensation.
A subsidy of 80% can be granted for the cost of the audit opinion if an application leads to compensation.
At the end of the period the figures will be checked on the basis of VAT declarations, after which a regulation can be carried out according to the actual reduction of turnover.
How do I apply for compensation?
The compensation scheme will be effective from 9 March to 8 July 2020. Applications must be digital. The applications will not be processed according to a first-come-first-served principle.
