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Tax rates in Sweden

Tax Rates

Consumption Taxes

Nature of the Tax
Mervärdesskatt (Moms) or Value-Added Tax (VAT)
Tax Rate
25%
Reduced Tax Rate
Reduced rate of 12%: some foodstuffs; non-alcoholic beverages; take away food; minor repair of bicycles, shoes and leather goods, clothing and household linen; hotel accommodation; restaurant and catering services; artists' own sales of works of art.
Lowest rate of 6%: domestic passenger transport; books (including e-books); newspapers and some periodicals; admission to cultural events (excluding cinema); writers and composers; admission to sports events; use of sports facilities.
Zero-rated: medicines supplied on prescription or sold to hospitals; printing and other services related to the production of magazines for non-profit making organisations; intra-community and international passenger transport.

For a detailed list of items subject to reduced rates, consult Skatteverket's website.

Other Consumption Taxes
Customs tariffs are only applied to goods from non-EU states. Sweden applies excise duties on alcohol, tobacco, fuel and electricity. Fuels are subject to energy tax, carbon dioxide tax, and sulphur tax.
Certain electronics and household appliances are also subject to excise taxes.

Sweden also levies a carbon tax.

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Corporate Taxes

Company Tax
20.6%
Tax Rate For Foreign Companies
Resident taxpayers are taxed on global income while foreign taxpayers are taxed only on the profits they make in Sweden. There are no special tax rates for foreign companies.
Capital Gains Taxation
Capital gains from a business-related sale of shares in a resident company are generally tax-exempt (conversely, losses are not deductible). Quoted/listed shares are considered held for business reasons if the company has a holding corresponding to at least 10% of the voting rights or the shares are held in the course of the business for a period of at least one year; while shares that are not quoted or listed are always considered as held for business reasons. Capital gains that are not considered business-related are treated as commercial income and are taxed at 20.6%.
Main Allowable Deductions and Tax Credits
Expenses incurred for business operations are generally deductible, including arm's length interest payments, rents and royalties, depreciation, losses and reserves. General start-up expenses for generating and maintaining business income are normally deductible.

Generally, interest payments made to related companies can be deducted if certain conditions are met. These conditions include the true lender being a resident in the European Economic Area (EEA), a jurisdiction with a comprehensive double taxation agreement, or being subject to a minimum tax rate of 10% on the interest earnings. The deduction for negative net interest related to internal and external loans in the corporate sector is limited to 30% of EBITDA.

Charitable contributions are generally non-deductible.

Certain items such as profit distributions, entertainment expenses exceeding a certain amount and taxes are non-deductible. Double taxation relief is provided for Swedish companies that are taxed abroad. A foreign tax credit may not exceed the amount of Swedish income tax attributable to the foreign-sourced income.

Land improvements may be depreciated at the rate of 5%/year of the acquisition cost, and buildings at rates between 2% and 5%/year of the taxable basis. The maximum allowance is 100% of the tax basis of the improvement/building.

Net operating losses can be carried forward indefinitely, except in the case of a direct or indirect change in the ownership structure of the company. The carryback of losses is not permitted.
Other Corporate Taxes
Business premises are subject to an annual real estate tax rate of 1% based on the assessed value of the property. However, for industrial property, the tax rate is reduced to 0.5%. Different tax rates apply to special property categories.

For the transfer of real properties, a stamp duty of 4.25% is levied on the acquisition value or the value estimated by tax authorities (the highest value is used for the calculation) when the transferee is a legal person. The rate varies between 0.4% and 2% for mortgages.

Mandatory social security charges payable by employers on remuneration to employees (or by the self-employed) are levied at 31.42%. Reduced rates (0% or 10.21%) are applicable for people born between 1938-1953. Pension benefits beyond the mandatory system are customary amongst most Swedish employers. A special salary tax is levied at around 24% on these additional pension premiums/commitments and is deductible for corporate tax purposes.

Various environmental taxes have been introduced in recent years, including the energy tax, the carbon tax and the sulphur tax.

Other Domestic Resources
Swedish Tax Agency

Country Comparison For Corporate Taxation

  Sweden OECD United States Germany
Number of Payments of Taxes per Year 6.0 10.1 10.6 9.0
Time Taken For Administrative Formalities (Hours) 122.0 163.6 175.0 218.0
Total Share of Taxes (% of Profit) 49.1 41.6 36.6 48.8

Source: Doing Business, Latest available data.

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Individual Taxes

Tax Rate

Up to SEK 613,900 0% + municipal tax (between 29-35%, average 32%)
Above SEK 613,900 20% national tax + municipal tax (average 32%)
Church tax and burial charges Between 1-2%
Highest combined tax rate: 52% (up to 56%, rarely)
Non-residents (employment income) 25%
Allowable Deductions and Tax Credits
Generally, all expenses related to an employment relationship are deductible (including travel expenses, automobile expenses, living allowances on business trips, necessary literature, and tools of the trade).
Resident individuals receive a personal allowance, deductible from the income tax base, depending on employment income. For low-income, the minimum deduction is SEK 14,200 and the maximum is SEK 37,200 (2023).

Personal pension insurance premiums and contributions to restricted pension savings accounts are deductible within certain limits, but only if the employee is not included in an employer-funded company pension plan. Interest costs paid to Swedish or non-Swedish lenders are deductible.

Several tax reductions are available: 50% of the labour costs relating to housekeeping is available (capped at SEK 50,000/year); 30% of the labour costs relating to repair, maintenance and rebuilding of a private dwelling (up to SEK 50,000/year); however, such reductions cannot exceed SEK 75,000 per person per annum. A deduction is also permitted for increased cost of living, generally for 2 to 3 years.

For more information, consult the website of the Swedish Tax Agency.

Special Expatriate Tax Regime

Residents are taxed on global income while non-residents are only taxed on their income received in Sweden.Individuals who are not residents of Sweden but work for a Swedish employer or a foreign employer with a permanent establishment in Sweden are subject to a flat tax rate of 25% deducted at the source. This rate also applies when a pension is paid by a Swedish entity to an individual who is not a tax resident of Sweden.

If non-residents work in Sweden for a non-Swedish employer that does not have a permanent establishment in Sweden, they become liable to pay taxes in Sweden if the work they perform is under the direction and control of a Swedish entity and the beneficiary of their work is also a Swedish entity. In such cases, the applicable tax rate is 25%. However, there is an exception to this rule if the employee works in Sweden for less than 15 consecutive days and a total of fewer than 45 days during a calendar year.

Foreign experts and key personnel working for a Swedish company or a non-Swedish company with a presence in Sweden can request 'expert tax relief'. To be eligible, the employment and stay in Sweden must be temporary, the employee must be a non-Swedish national, and they should not have been a Swedish tax resident in any of the five calendar years preceding their employment in Sweden. Alternatively, the expert tax relief can be granted if the monthly income exceeds two times the Swedish price base amount for the year the employment begins. In 2023, this threshold is SEK 105,001 per month. To qualify, the employee needs to apply for a ruling from the Taxation of Research Workers Board ("Forskarskattenämnden") within three months of starting work in Sweden.

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Double Taxation Treaties

Countries With Whom a Double Taxation Treaty Have Been Signed
Swedish Tax Treaty Network
Withholding Taxes
Dividends: 0 (residents and non-resident individuals)/30% (non-resident companies, exceptions may apply); Interests: 0%; Royalties: 0%.

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Latest Update: February 2024