Tax Control Framework (TCF) - Denmark

Defining the TCF in Denmark

In Denmark, the implementation of a Tax Control Framework (TCF) is increasingly seen as essential for companies aiming to manage tax risks effectively, stay compliant with evolving regulations, and meet rising demands for transparency. A well-structured TCF allows businesses to demonstrate responsible tax practices through formalized risk assessments, internal controls, and documented processes.

As tax authorities and stakeholders intensify their focus on compliance and governance, Danish organizations are adopting modern, technology-supported frameworks to stay in control and build confidence across their financial ecosystem.

A Tax Control Framework is a systematic, risk-based model for managing an organization’s tax responsibilities. It outlines the controls and procedures necessary to ensure tax compliance, mitigate risk, and maintain accountability.

Typical components of a TCF in Denmark include:

• Identification and assessment of tax risks
• Implementation of tailored controls
• Comprehensive documentation of tax-related processes
• Continuous monitoring and performance review

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Regulatory Landscape in Denmark

The Danish tax authority (Skattestyrelsen) is enforcing tax law with increasing rigour. Authorities expect companies to take accountability for tax compliance and to demonstrate how they manage tax risks through structured frameworks.

Danish businesses face a dual challenge:

• Increased legal expectations: Failure to comply with evolving tax rules can lead to fines, audits, and reputational harm.
• Rising stakeholder scrutiny: Investors, supervisory boards, and external auditors increasingly expect a formalized approach to tax governance.

In this context, a TCF serves as both a compliance mechanism and a strategic tool for building stakeholder trust.

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Types of organization that should adhere

A Tax Control Framework is particularly relevant for:

• Finance and tax teams overseeing compliance functions
• Executive leadership and boards accountable for governance
• Companies operating internationally, with cross-border tax requirements
• Growing enterprises seeking to formalize internal controls early

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Benefits of Implementing a TCF

Implementing a TCF offers numerous advantages for Danish companies:

• Regulatory compliance: Stay aligned with Danish tax laws and avoid costly penalties.
• Improved governance: Provide executives and boards with clear oversight of tax matters.
• Operational efficiency: Reduce time spent on manual tasks through streamlined processes.
• Audit readiness: Maintain a clear and consistent audit trail.
• Reputation management: Demonstrate responsible tax practices to external stakeholders.

With increased regulatory scrutiny and growing reputational risk, Danish businesses must go beyond reactive tax management. A Tax Control Framework ensures:

• A proactive stance on tax governance
• Readiness for audits and regulatory reviews
• Alignment with broader ESG and corporate responsibility objectives

Implementing a TCF is not only about compliance—it’s about building a resilient, trustworthy tax strategy that supports long-term success.

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Key Elements of a TCF in Denmark

While a TCF can vary depending on the organization’s size and complexity, it generally includes the following components:

1. Risk Management

Mapping tax risks across all areas of business operations and prioritizing them based on likelihood and impact.

2. Internal Controls

Developing and applying controls to mitigate identified tax risks. These should be tailored, practical, and embedded into daily workflows.

3. Roles and Responsibilities

Establishing clear accountability for all tax-related activities—from preparation and review to approval and reporting.

4. Monitoring and Reporting

Setting up ongoing monitoring procedures and dashboards that provide transparency into control status, exceptions, and completion rates.

5. Documentation and Audit Trail

Ensuring that every tax-related activity and decision is supported by evidence and easily auditable.

6. Continuous Improvement

Regularly reviewing the effectiveness of controls and adapting the framework in response to regulatory changes or internal developments.

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How Impero Supports TCF Implementation

Impero’s cloud-based risk & control platform simplifies the design, execution, and monitoring of Tax Control Frameworks. With Impero, companies can:

• Document tax risks and controls in a central platform
• Automate recurring tax-related internal control tasks and reminders
• Assign responsibilities and deadlines to the appropriate stakeholders
• Generate audit-ready documentation for regulators or internal review
• Scale tax compliance programs across teams and jurisdictions

By embedding strong risk & control processes into daily operations, Impero helps Danish companies turn tax control from a reactive function into a proactive strategic asset.

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Get started with the Impero platform

Are you looking to strengthen your organization’s compliance with the Danish Tax Control Framework (TCF)? Impero helps you implement a structured, transparent, and auditable approach to tax governance—whether you're facing mounting pressure from Danish Tax Authorities (Skattestyrelsen) or simply aiming to stay in control.

👉 Reach out to our team to discover how Impero can support your tax function with automation, accountability, and real-time oversight.