The Significance of Company Structure When Selling Your Business

Note: This article describes Danish company and tax rules specifically.

The company structure behind your business is often one of the factors with the biggest impact on both how a sale can be structured, and how much you actually keep afterward. It's worth knowing the key differences long before you list the business for sale.

Direct ownership: Simple, but less tax flexibility

If you own your ApS or A/S directly as a private individual, any gain from a sale is taxed as share income, immediately, at your personal income level for the year the sale happens. It's the simplest structure, but gives you fewer options for planning when and how the taxation falls.

Ownership via a holding company: More flexibility

If instead you own the operating company through a holding company, a sale of the operating company can often be completed tax-free for the holding company — the gain from selling shares in a subsidiary (where the holding company owns at least 10%) is generally tax-free for the company. This means the entire sale proceeds can remain in the holding company, without you being taxed immediately as a private individual. You're only taxed once you actually withdraw the money from the holding company — for example as dividends.

What does this mean in practice for you as a seller?

• Deferred taxation: You can wait to withdraw the money personally until it suits you — and possibly spread it over several years to avoid hitting the high 42% share income rate all at once.
• Reinvestment: The money in the holding company can be reinvested — for example in a new business, real estate or securities — without you first being taxed personally on the amount.
• Simpler deal for the buyer: A clear company structure, where it's obvious exactly what's being sold, makes the due diligence process easier and can make the business more attractive to a buyer.

What if the structure isn't set up correctly before the sale?

If you've so far owned the business directly and want to establish a holding structure before a sale, it typically requires a tax-free share exchange — and special rules apply for how long the holding company needs to have owned the shares before a subsequent sale can happen tax-free. This needs to be planned well in advance, not at the last minute before a deal.

When should you have the structure reviewed?

If you're considering selling within the coming years, it's worth having the company structure reviewed early — ideally 1–2 years before an expected sale — so any changes can be in place before you start the sale process.

Unsure how your structure affects a future sale? Read more in our guide on tax when selling a business (currently in Danish), or book a no-obligation call.