EOR vs ApS in Denmark: hire now or build the company first?

Choose an employer of record when you want one or a handful of people working in Denmark soon and are not yet sure the Danish operation will grow. Form a private limited company (anpartsselskab, ApS) when Denmark is clearly a long-term base, when you expect a sizeable team, or when you need a Danish company for reasons beyond employment, such as trading locally.

The two routes give the employee the same Danish rights. What differs is who carries the employer’s administration, how much money and time the start-up takes, and what the monthly cost looks like as headcount changes. Below, each route is described on its own terms, then compared on cost, permits and switching.

The share capital of an ApS must be DKK 20,000 or more; it can be contributed in DKK or euro and then belongs to the company itself. A public company (aktieselskab, A/S) needs DKK 400,000, which is why foreign groups setting up a first Danish subsidiary rarely choose it. Both forms are governed by the Companies Act (Selskabsloven).

Registration with the Danish Business Authority (Erhvervsstyrelsen) is done on virk.dk and must happen no more than 2 weeks after the decision to found the company. The digital registration fee is DKK 670; where no digital self-service is available it is DKK 2,150, and later changes cost DKK 180 each. Erhvervsstyrelsen lists the current amounts on its fees page. On registration the company receives a CVR number, the identifier that every Danish authority, bank and customer will ask for. The capital has to sit somewhere, so a Danish business bank account is part of the founding work; foreign-owned companies are well advised to start that conversation with a bank before anything else.

A foreign company can also open a branch (filial) for the same DKK 670 fee. A branch is not a separate company, so the parent stays directly answerable for its Danish obligations, but it still has to register, keep accounts and take on every employer duty described in the next section.

Tax follows the company. Danish corporate tax is 22% for 2026 and 2027, and VAT is 25%, with registration required once turnover passes DKK 50,000. Under an employer of record arrangement your business does not trade in Denmark to employ someone there; it pays a service fee for the employment.

Registering the company is the quick part. Becoming a working Danish employer adds a longer list, and every item has its own system, deadline or provider:

• employer registration for A-skat and the 8% labour market contribution (AM-bidrag) on virk.dk
• monthly eIndkomst reporting of pay, tax, AM-bidrag and ATP, and payment to the tax account by the deadline
• the quarterly invoices from Samlet Betaling, billing AES, ATP, AUB, Barsel.dk and the financing contribution
• work-injury insurance with a private insurer, required by the Work Injury Act
• MitID Erhverv for the company’s digital access, and a Danish business bank account
• bookkeeping and a statutory annual report
• a written workplace assessment (arbejdspladsvurdering, APV) under the Working Environment Act
• a system that logs working time each day, keeping the records for 5 years
• written terms for every hire within 7 days and 1 month of the start

None of these tasks is difficult for a company with a Danish payroll team or a Danish accountant on retainer. For a business with no one who reads Danish guidance, they add up to a standing workload, and it does not shrink just because the company only employs two people. With an EOR, the same list exists, but it sits with us; our explainer on the EOR model in Denmark sets out exactly which tasks move across.

From the employee’s side, very little depends on the route. A salaried person is covered by the Salaried Employees Act (Funktionærloven) whichever company signs the contract, so the notice periods, full pay during sickness and dismissal protection are the same. Holiday follows the Holiday Act (Ferieloven): 25 days a year, earned at 2.08 days a month, with a 1% holiday supplement for salaried staff.

Payroll looks identical too. In both cases A-skat is withheld at the tax-card rate, AM-bidrag at 8%, and ATP at DKK 99 a month from the employee and DKK 198 from the employer for a full-time monthly-paid person. Net pay on a DKK 55,000 monthly salary in Copenhagen is about DKK 35,519 in a standard 2026 month either way.

Two practical differences can matter to candidates. The name on the contract is ours rather than yours under an EOR, which some people ask about at offer stage; and if you later move the person to your own ApS, that is a new employment, with holiday settled on leaving. Both points are easy to explain, but worth raising before the offer goes out.

The employer’s side of sickness is also unchanged. Whoever employs the person pays full salary through the first 30 calendar days of absence and can reclaim the municipal sickness benefit from day 31 onwards. The refund claim has to be made by the employer in both models, so the question is only whether your ApS or we file it.

The employment cost itself is the same under both routes. On a DKK 660,000 base in Copenhagen for 2026, gross pay with the 1% supplement is DKK 666,600, and statutory employer items add DKK 8,202, about 1.2% of gross pay, for an employer cost of approximately DKK 674,802 before pension and insurance. Our article on employer cost in Denmark breaks that total down.

The difference lies around that figure. An ApS ties up DKK 20,000 of capital, costs DKK 670 to register, and then carries adviser, accounting, banking and payroll-software costs every month, whether it employs one person or twenty. The EOR route has no set-up cost; the charge, from €599 per employee per month, rises and falls with the number of people.

That shape is what decides most comparisons. For one or two employees, a fee per head is usually lighter than the fixed overhead of a company. As headcount climbs, the fixed overhead of an ApS is spread across more people while the per-head fee keeps growing, and at some point the lines cross. Where exactly depends on your adviser quotes, which is why we suggest asking for them before deciding.

Count the hours as well as the kroner. In an ApS, someone has to approve the eIndkomst report every month, check each quarterly Samlet Betaling invoice, keep the work-injury policy in force, maintain the APV and the working-time records, and sign off the annual report. Those hours belong in the comparison next to the adviser quotes, priced at whatever your finance team’s time is worth.

When the numbers look close, the decision normally turns on a few plain questions about your plans rather than on the cost tables. Answer these honestly and the route tends to choose itself:

• How many people in Denmark within two years? One to three hires sit comfortably with an EOR. A team that will pass ten, especially with non-EU specialists, starts to justify the fixed cost of a company.
• Will you invoice Danish customers? Trading in Denmark brings a CVR number, VAT registration above DKK 50,000 of turnover and a corporate tax return at 22%. If you need the company for sales anyway, employing through it adds less.
• Who in your business will read Danish authority letters? Samlet Betaling sends its quarterly invoices through Digital Post on virk.dk, and by post to foreign companies; Skattestyrelsen works in Danish. Without that capacity, an ApS means buying it in.
• How firm is the plan? If the Danish venture might stop after a year, an EOR employment ends under the normal Funktionærloven notice rules, and there is no company left to deal with.
• When does the first person need to start? Registration on virk.dk is only the first step. The employer registrations, insurance, bank account and payroll have to be ready before the first salary is due.

Often a single answer points firmly one way. If the answers split, starting with an EOR keeps the option of an ApS open without committing capital, while starting with an ApS commits you to the full employer setup from day one.

Non-EU hiring tilts the comparison as a team grows. SIRI’s Fast-Track Scheme, a separate permit route for certified employers, requires certification, which is open only to a company with 10 or more permanent full-time staff on its Danish payroll. Temporary and part-time staff do not count. A new ApS therefore cannot use Fast-Track in its first phase, and a company that expects many non-EU hires should factor in how long it will take to reach that size.

Switching is the other half of the decision. A common sequence is to employ through us while the Danish market is tested and incorporate when the numbers justify it. When that happens, each person receives a new contract from the ApS, and their employment with us ends on an agreed date. Untaken holiday is paid out as the 12.5% holiday allowance under Ferieloven, and the new employer takes over payroll from the next month. Planning the date around the holiday year, which runs from 1 September to 31 August, keeps the settlement simple.

Comparing providers as well as structures? Our six tests for choosing an EOR in Denmark are written for that job. The guide to employing in Denmark covers the wider rules, and the Employer of Record Denmark homepage shows how to start.

Q01EOR vs ApS in Denmark: which is cheaper?+

A.For one or two employees an EOR is usually lighter, because an ApS carries fixed set-up and running costs regardless of headcount. As the team grows, the fixed costs of an ApS are spread over more people and the comparison can reverse.

Q02What is the minimum share capital for an anpartsselskab?+

A.A minimum of DKK 20,000 in share capital, payable in DKK or euro and kept within the company. A public company (A/S) needs DKK 400,000.

Q03How quickly must an ApS be registered?+

A.Within 2 weeks of the founding decision, through virk.dk with the Danish Business Authority. The digital registration fee is DKK 670.

Q04Do employees lose anything under an EOR compared with an ApS?+

A.No. The same Danish acts apply to the employment: Funktionærloven for salaried staff, Ferieloven for holiday and the Written Terms of Employment Act for the contract.

Q05Can a new ApS use the Fast-Track Scheme for permits?+

A.Not at first. Fast-Track needs SIRI certification, which requires at least 10 full-time permanent employees in the Danish company.