Employee shares – reporting via eKapital

27 November 2024

Why is the reporting to eKapital important?

Where the reporting to eIncome is the reporting of salary income, the reporting to eKapital is a reporting of the actual acquisition of the shares received by the employees as part of the remuneration during the income year as a result of their participation in one or more share-based remuneration programs. Stock remuneration comes in many forms and the most commonly used include Restricted Stock Units (RSUs), Performance Shares, Stock Options and Warrants.

Normally, the obligation to report to eKapital lies with custodians, i.e. banks and other financial institutions. Since the income year 2019, the reporting obligation for employee shares now includes employers.

The reporting of the acquisition of employee shares results in the information automatically being included in the employees' annual tax statement. In this way, employees simply need to check that the correct number of shares has been reported, regardless of whether the shares are held in a Danish or foreign depository.

Reporting to eKapital must be made for all employees who have received shares covered by sections 7P, 16 or 28 of the Danish Tax Assessment Act (in Danish; “Ligningsloven”) who are employed by Danish companies, regardless of whether the employees are resident in Denmark or abroad.

In practice, the reporting ensures that the Danish Tax Agency receives the necessary information about the shares. Otherwise, the employee is responsible for disclosing the information in connection with the preparation of their tax return. 

How does the reporting to eKapital work?

The actual reporting is made via a special Excel-sheet. Information on the acquisition, including information on each participant, the share and the transaction itself, must be filled into this Excel-sheet, for the information to be incorporated into the Danish Tax Agency's systems. The sheet must be completed in a predetermined format, which among other things requires the number of characters and decimals individually determined for each field. Thus, precision is important as the format must be strictly followed.

When the sheet is filled out, it must be converted into a txt.-file, containing the codes. This is then submitted to the Danish Tax Agency. The submission itself can be made via the company's tax folder or via a so-called Gateway access. The advantage of submission via Gateway access is that the submitted quality is assured and handled directly in the system in which custodians normally report, before being pushed to the Danish Tax Agency’s system.

Deloitte has established a Gateway-access, which can be used to report on behalf of companies. As this process can be time-consuming, Deloitte can offer assistance in this regard.

When should the reporting be in place?

The report must be made no later than 20 January of the following income year. Thus, the reporting for the income year 2024 must be made no later than 20 January 2025. It is not possible to request a deadline extension.

The reporting can normally be done from mid-December. The exact start date is expected to be announced soon and will be available on eKapital's website.

Please note that incomplete or incorrect reporting may result in fines according to the general rules.

Have you also remembered the reporting to eIncome?

In addition to reporting to eKapital, it is also important to remember reporting the profits which are taxable as salary income.

Deloitte is ready to help you!

For companies, the eKapital and eIncome reporting process can seem complex, which is why Deloitte is ready to help you. With our experienced experts and convenient Gateway-access, we are ready to guide your company through the reporting end-to-end.