Greenland Tax Regime

Greenland operates a self-standing corporate and personal tax system administered by the Greenland Self-Government (Naalakkersuisut) rather than by Denmark, notwithstanding Greenland's constitutional position within the Kingdom of Denmark. Corporations are taxed at a flat 25% rate on worldwide income, with an effective rate of 26.5% where a year-end surcharge applies. There is no value-added tax in Greenland; indirect taxation instead relies on targeted import duties, excise duties and stamp tax. The regime is distinctive for its extensive industry-specific royalty and surtax regimes applicable to mineral, oil and gas exploitation, and for a narrow double taxation treaty network limited to the other Nordic jurisdictions. Administration is centralised in the Greenland Tax Agency (Skattestyrelsen), and the system reflects the small, resource-dependent character of the Greenlandic economy.

1.1 Sources

Primary legislation includes the Greenland Tax Act (Landstingslov om indkomstskat), the Greenland Company Tax provisions, the Mineral Resources Act (råstofloven) governing oil, gas and mining royalties, and the Greenland Tax Administration Act.

1.2 Recent developments

From 1 January 2022, companies have been able to make on-account (advance) corporate tax payments to the Greenland tax authorities ahead of the annual assessment; where final corporate tax exceeds the on-account amount paid, a 6% surcharge applies to the shortfall, producing an effective corporate tax rate of 26.5% for companies that do not fully prepay their liability. Oil and mineral licence holders remain exempt from this 6% surcharge under current administrative practice. Model licence terms proposed for upcoming exploration rounds in the Baffin Bay area contemplate revised surplus-royalty thresholds and rates, signalling continued evolution of the resource-taxation framework alongside the broader corporate tax rules, which have remained at a 25% headline rate since 1 January 2020.

Headline statutory corporate income tax rate for a resident company. Where sub-national (state, provincial, cantonal or municipal) corporate taxes apply, the combined rate reported by the OECD is shown. Projected 2026–2028 rates carry the current rate forward unless a change is already enacted or officially scheduled. As-of 2026.

Top marginal statutory personal income tax rate on employment income for a resident individual. Where sub-national (state, provincial, cantonal or municipal) income taxes are a standard part of the system, the combined top rate is shown. Projected 2026–2028 rates carry the current rate forward unless a change is already enacted or officially scheduled. As-of 2026.

2.1 Rates and residence

Greenlandic resident companies are taxed on worldwide income at a flat corporate income tax rate of 25%, applicable equally to Greenlandic and foreign-owned companies, in effect since 1 January 2020. Non-resident companies are taxed on business profits derived through a permanent establishment in Greenland, and, independently of any permanent establishment, on profits derived in connection with the exploration for or exploitation of oil, gas and minerals in Greenland or its territorial waters. Income from real estate situated outside Greenland is exempt for resident companies. There are no municipal or local corporate income taxes or similar charges in Greenland; the 25% rate (or 26.5% effective, see below) is the sole layer of corporate income tax.

Since 1 January 2022, companies may pay corporate tax on account to the Greenland tax authorities before the end of the relevant tax year. Where the tax finally assessed exceeds the on-account amount paid, a surcharge of 6% of the shortfall is imposed, producing an effective rate of 26.5% for companies that under-prepay; the surcharged balance is due for payment on 1 November, with a final due date of 20 November. Oil and mineral licence holders are exempt from the 6% surcharge under current administrative practice, reflecting the distinct royalty-based framework applicable to those industries.

2.2 Dividends and participation

Greenland does not operate a formal participation exemption regime of the EU type for inbound or outbound dividends. Dividend distributions by Greenlandic companies are subject to dividend withholding tax as described in section 4, with rates varying by recipient and, in certain respects, by municipality of the paying company. Outbound dividends to parent companies in Denmark, the Faroe Islands, Iceland or Norway may benefit from reduced withholding under Greenland's limited double taxation treaty network, while dividends to shareholders in non-treaty jurisdictions bear the full domestic withholding rate.

2.3 Income determination and deductions

Taxable income is computed from commercial accounts adjusted for Greenlandic tax rules on an accruals basis. Ordinary business expenses incurred to earn, secure and maintain income are deductible; capital expenditure on plant, buildings and other qualifying assets is instead recovered through depreciation allowances at rates set by category of asset. Paid or accrued corporate taxes and dividend withholding taxes may generally be deducted in computing royalties due from mining licensees, except for uranium and gemstone licences, reflecting the close interaction between the general tax base and the industry-specific royalty regimes described in section 2.9.

2.4 Interest limitation

Greenland does not apply a fixed-ratio (EBITDA-based) interest barrier of the ATAD type. Interest expense is deductible where incurred in connection with the production of taxable income, subject to arm's-length pricing requirements for related-party financing and general anti-avoidance principles applied by the Greenland Tax Agency. Given the small size of the domestic capital market, related-party and shareholder financing of Greenlandic operations is common and receives particular scrutiny on audit.

2.5 Losses

Trading losses may generally be carried forward for offset against future taxable profits, subject to conditions on continuity of ownership and business activity applied by the Greenland Tax Agency. There is no general loss carryback. Given the capital-intensive, multi-year development cycles typical of mineral and oil exploration projects, loss carryforward is of particular practical importance to resource-sector taxpayers awaiting production revenue.

2.6 Groups and consolidation

Greenland does not operate a formal fiscal consolidation regime permitting the pooling of profits and losses across group companies for corporate income tax purposes; each Greenlandic company is assessed on a standalone basis. Multinational groups with Greenlandic operations typically manage group-level tax efficiency through financing structure, transfer pricing policy and the timing of profit repatriation via dividends, rather than through a domestic group-relief mechanism.

2.7 Controlled foreign companies and international rules

Greenland does not operate a dedicated controlled foreign company attribution regime. Anti-avoidance protection instead relies on Greenland's source-based taxation of business profits connected with Greenlandic activity (including the extraterritorial rule reaching oil, gas and mineral profits regardless of permanent establishment), general anti-avoidance principles, and the exchange-of-information provisions in Greenland's narrow set of double taxation treaties with Denmark, the Faroe Islands, Iceland and Norway.

2.8 Transfer pricing

Related-party transactions involving Greenlandic taxpayers are expected to be conducted on arm's-length terms, with the Greenland Tax Agency applying principles consistent with the OECD Transfer Pricing Guidelines notwithstanding Greenland's position outside the EU and the OECD's direct membership structure. This is of particular significance for the resource sector, where intra-group service, financing and marketing-hub arrangements between a Greenlandic exploration or mining subsidiary and its foreign parent are common and subject to audit scrutiny, and where royalty calculations may be sensitive to the deductibility of related-party charges.

2.9 Incentives and special resource-sector regimes

Greenland's principal industry-specific regimes apply to mineral resources, exploitation of water resources for energy production, and commercial exploitation of water and ice, alongside the general corporate tax base. All companies holding mineral exploration licences must pay a government royalty as a condition of any production licence, with royalty terms varying by the age and type of licence. On licences issued before 2014, oil companies pay a surplus royalty of 7.5%, 17.5% and 30% once the internal rate of return exceeds 21.75%, 29.25% and 36.75% (plus the official Danish discount rate) respectively, and 'carry' a 12.5% state ownership share of costs (8% in the 'open door area'); newer licences apply a 2.5% gross royalty plus the same tiered surplus royalty structure at higher turnover thresholds, with state carried participation reduced to 6.25%. Model terms proposed for future Baffin Bay licensing rounds contemplate lower surplus-royalty tiers of 7.5%, 10% and 12.5%. Mining licences carry standard gross royalties of 5.5% on gemstones, 5% on uranium and rare earth elements, and 2.5% on other minerals, with paid or due corporate tax and dividend withholding generally deductible in computing the royalty base except for uranium and gemstone licences (which also bear an additional surplus royalty on gross profits above 40%). Companies licensed to exploit specific feedstocks such as water, ice or hydroelectric potential may be granted tax exemption in place of these royalty structures, under terms specified in the individual licence.

2.10 Pillar Two

Greenland has not enacted Pillar Two (global minimum tax) legislation implementing an income inclusion rule, undertaxed profits rule or qualified domestic minimum top-up tax as of June 2026. Given the small scale of most Greenlandic corporate groups, direct in-scope exposure (consolidated group revenue of at least EUR 750 million) is limited to Greenlandic operations of large multinational resource and shipping groups, which may be affected indirectly by an income inclusion rule or undertaxed profits rule applied in another jurisdiction in the group's structure, notwithstanding the absence of domestic implementing legislation in Greenland itself.

2.11 Branch income and reorganisations

A non-resident company's Greenlandic branch or permanent establishment is taxed at the standard 25% rate (26.5% effective where the surcharge applies) on profits attributable to the branch, computed on a basis similar to that of a resident company. There is no separate branch profits remittance tax. Domestic corporate reorganisations are assessed under general principles; there is no dedicated statutory reorganisation code comparable to those found in larger jurisdictions, so mergers, demergers and asset transfers involving Greenlandic entities are typically structured with reference to Danish and Greenlandic company law together with case-by-case engagement with the Greenland Tax Agency on the tax consequences.

3.1 Residence and rates

Resident individuals are taxed on worldwide income; non-residents are generally taxed on Greenlandic-source income, including employment income from work performed in Greenland. Residence is established by taking up abode in Greenland or by a qualifying period of stay. Personal income tax is levied through a combination of national tax and municipal tax, with the municipal component varying by the individual's municipality of residence, producing a combined progressive burden on employment, business and other income. Employers withhold tax monthly (A-tax) on employment income, with annual reconciliation through the individual's tax assessment.

3.2 Investment income and capital gains

Dividend income is subject to withholding tax as described in section 4, with the rate applicable to resident individuals reconciled against their final personal tax liability. Interest income is generally included in taxable income at the individual's marginal combined national and municipal rate. Greenland does not impose a distinct, broadly applicable capital gains tax comparable to those in larger economies; gains on the disposal of business assets are generally captured within ordinary business income where the disposal is connected with a trade, while gains of a clearly private, non-trading nature are generally outside the scope of taxation.

3.3 Social security and payroll

Greenland's social security and welfare financing is integrated substantially into the national and municipal income tax structure rather than through a separately labelled payroll-tax system of the type found in many other jurisdictions. Employers withhold A-tax monthly from employee salaries and remit it to the Greenland Tax Agency, together with any applicable municipal tax component, with year-end reconciliation against the employee's actual liability for the tax year.

3.4 Inbound individuals and reliefs

There is no net wealth tax and no general inheritance or gift tax in Greenland. There are no property taxes. Individuals relocating to Greenland for employment — a common pattern given the reliance of the mining, fishing and construction sectors on expatriate skilled labour — should plan around municipal tax variation by place of residence, employer A-tax withholding obligations, and the limited relief available under Greenland's narrow treaty network (Denmark, the Faroe Islands, Iceland and Norway) for income that may also be taxed in the individual's home jurisdiction outside that Nordic group.

Greenland applies withholding tax to dividends paid by Greenlandic companies, with rates that can differ by the municipality of the paying company, reflecting the interaction between national and municipal taxation in the Greenlandic system. Interest and royalty payments to non-residents are subject to domestic withholding absent treaty relief. Very few double taxation treaties offer relief to Greenlandic outbound payments: Greenland has full double taxation treaties covering corporate tax only with Denmark, the Faroe Islands, Iceland and Norway — a materially narrower network than most jurisdictions of comparable economic significance, reflecting Greenland's distinct treaty position separate from Denmark's own treaty network. Payors making cross-border payments to jurisdictions outside this Nordic group should expect to withhold at full domestic rates with no treaty relief available.

Because Greenland's treaty network is confined to its immediate Nordic neighbours, most inbound and outbound structures involving investors from outside Denmark, the Faroe Islands, Iceland and Norway must plan on the basis that no treaty relief will reduce Greenlandic withholding, materially increasing the importance of entity choice, financing structure and, for the resource sector, the specific royalty terms attached to the relevant exploration or production licence.

5.1 General anti-abuse and treaty limitations

The Greenland Tax Agency applies general anti-avoidance principles to disregard or recharacterise arrangements lacking commercial substance and structured principally to secure a Greenlandic tax advantage. Given the narrow treaty network described in section 4, treaty-shopping concerns are less prominent for Greenland than for jurisdictions with extensive treaty networks; instead, the practical anti-avoidance focus is on ensuring related-party pricing for resource-sector services, financing and marketing arrangements reflects arm's-length terms, and on the correct characterisation of payments for royalty-deductibility purposes.

5.2 Resource-sector oversight and disclosure

Given the concentration of foreign direct investment in oil, gas and mineral exploration, the Greenland Tax Agency works closely with the mineral resources authority in administering royalty calculations, licence-term compliance and the interaction between corporate tax, dividend withholding and royalty liabilities. Licensees should expect scrutiny of the deductibility of corporate tax and dividend withholding in computing royalty bases (subject to the uranium and gemstone carve-outs noted in section 2.9), and should consult the concrete terms of their specific licence rather than relying solely on standard licence terms, since royalty levels and thresholds differ materially between licences and vintages.

6.1 No value-added tax

Greenland does not levy a value-added tax or general sales/consumption tax. This is a fundamental structural difference from most jurisdictions surveyed in this series and materially simplifies indirect tax compliance for Greenlandic businesses, which need not register for, charge or recover VAT on domestic supplies. There are also no general import duties on operating equipment brought into Greenland, supporting capital-intensive resource-sector investment.

6.2 Import duties, excise and stamp tax

Notwithstanding the absence of general import duties, targeted import duties apply to specific categories of goods, including motor vehicles, alcohol, cigarettes and certain food products. Excise duties apply to fishing of certain fish species, alcohol produced in Greenland, lottery and gambling activities, and motor vehicles, alongside environmental taxes on mineral oil products used for heat, electricity and motor fuel production. Stamp tax is payable on a limited set of documents, notably deeds transferring real estate and ships, at 1.5% of the transfer sum, extending to transfers of shares in companies that own ships. There are no property taxes and no net wealth tax in Greenland.

7.1 Filing, assessment and audit

The Greenland Tax Agency (Skattestyrelsen) administers corporate and personal income tax, dividend withholding and the resource-sector royalty regimes. Companies may make on-account corporate tax payments during the tax year, with final assessment reconciling the on-account amount against the actual liability; a 6% surcharge applies to any shortfall (other than for oil and mineral licence holders), producing the effective 26.5% rate discussed in section 2.1, with the surcharged balance due on 1 November and a final payment date of 20 November. Individual taxpayers are subject to monthly A-tax withholding by employers with annual reconciliation. Audit activity is concentrated on resource-sector royalty compliance and related-party pricing given the sector's economic significance.

7.2 Appeals and penalties

Taxpayers disputing an assessment may object to the Greenland Tax Agency and pursue further appeal through the Greenlandic administrative and court system, with the possibility of recourse to Danish courts on certain constitutional and cross-jurisdictional matters given Greenland's position within the Kingdom of Denmark. Interest accrues on underpaid on-account tax through the 6% year-end surcharge mechanism described above; late filing and late payment outside the on-account system attract further interest and penalties under the Greenland Tax Act.

Because the corporate on-account system is central to avoiding the 6% surcharge, companies expecting profit growth during the year should true up their on-account payments proactively ahead of year-end rather than waiting for the November settlement date, at which point the surcharge on any shortfall has already accrued.

9.1 Entity choice

The Greenlandic limited liability company (aktieselskab/anpartsselskab, mirroring Danish company law forms as adapted for Greenland) is the standard vehicle for inbound investment, offering limited liability and straightforward incorporation. Foreign resource-sector investors frequently hold Greenlandic exploration and production licences through a dedicated Greenlandic subsidiary to ring-fence licence obligations and royalty exposure from the wider group. Branches of foreign companies may also operate directly, taxed on Greenlandic-attributable profits at the standard rate, and are common for shorter-duration exploration or service activities that do not warrant local incorporation.

9.2 Structuring and incentives

Structuring in Greenland is dominated by resource-sector considerations: the specific royalty terms attached to an individual oil, gas or mineral licence — rather than the general 25%/26.5% corporate tax rate — are frequently the primary driver of project economics, and licence terms should always be checked directly rather than assumed from standard terms, since royalty tiers and thresholds vary by licence vintage. Companies engaged in water, ice or hydroelectric exploitation under a public licence should confirm whether their licence substitutes a turnover-based royalty or other payment for standard corporate taxation. Given the narrow treaty network, groups should plan financing and holding structures with Nordic (Danish, Faroese, Icelandic or Norwegian) intermediate entities where treaty relief on dividends, interest or royalties is commercially important.

9.3 Worked effective-rate illustration

A Greenlandic trading company (not an oil or mineral licensee) earns EBITDA of DKK 15,000,000, books depreciation of DKK 2,500,000 and deductible interest expense of DKK 1,500,000. Taxable profit is 15,000,000 minus 2,500,000 minus 1,500,000 = DKK 11,000,000. Corporate tax at the standard 25% rate is 25% of 11,000,000 = DKK 2,750,000. The company pays only DKK 2,000,000 on account during the year against this final assessed liability of DKK 2,750,000, leaving a shortfall of 2,750,000 minus 2,000,000 = DKK 750,000. The 6% year-end surcharge applies to that shortfall: 750,000 times 6% = DKK 45,000. Total corporate tax paid is therefore 2,750,000 plus 45,000 = DKK 2,795,000, an effective rate of 2,795,000 divided by 11,000,000 = 25.4%. The theoretical maximum effective rate of 26.5% (25% times 1.06) applies only where the entire year's liability is left unpaid on account until the final assessment; the actual effective rate scales down with the proportion of the liability already prepaid, giving companies a clear incentive to true up on-account payments before year-end.

9.4 Compliance

Expect annual corporate tax assessment reconciled against on-account payments, monthly A-tax payroll withholding and remittance, no VAT compliance burden given the absence of a Greenlandic VAT system, and — for resource-sector licensees — detailed royalty computation and reporting under the specific terms of each exploration or production licence. Groups with Greenlandic operations should maintain arm's-length transfer pricing support for intra-group financing and service arrangements, monitor municipal variation in dividend withholding, and track the narrow four-country treaty network when structuring cross-border payment flows.