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Sweden – Expert Tax Relief extended to 5 Years

As of 2021, new rules regarding “expert tax relief” came into force. Previously, the tax relief itself was only valid for the first 3 years, even if the employment lasted for 5 years.

From January 1st, 2021, the tax benefits of a granted Expert Tax Relief can be applied to the whole 5 years.

What is the Expert Tax Relief?

In order to encourage talented professionals to move to Sweden, Sweden offers an expert tax relief programme to benefit certain types of foreign professionals and their Swedish employers.

To qualify for expert tax relief an individual must either have a high gross salary (minimum SEK 95,200 per month during 2021), be recognised as an established international expert, or be a key person for their employer, while working on a temporary basis in Sweden.

Primarily, the tax relief means that only 75 percent of the “expert’s” income is taxable and included in the base for employer’s social charges. Prior to January 1, 2021 relief could be granted for the first three years in Sweden. From January 1, 2021, the period for which relief can be granted has been extended from three to five years.

The purpose of the extension is so that the Swedish rules better correspond to rules in other European countries. It is important that the rules are competitive since companies established in Sweden would otherwise have a disadvantage in recruiting foreign experts, researchers and other key persons.

What if I am currently working in Sweden?

For individuals who began their stay in Sweden after May 31 2020, their 3 years of tax relief can be extended to 5 years, however their Swedish employer will have needed to have filed for an extension application with the Forskarskattenämnde before March 31st, 2021. An application for tax relief should normally, at the very latest, be filed with the Taxation of Research Workers Board three months after the start of the stay (and work) in Sweden

How TCP can help?

With all of the above differences in mind, understanding rules about work in Sweden can be quite a challenge. TCP Solutions has solutions for this. Are you a freelancer, agency operating in the Swedish market, or an employee or employer? Through, for example, payrolling, contract management and our legal service, we guarantee that you comply with all specific national and provincial laws and regulations. Do you want to know more? Feel free to contact us. Call us on +44 (0) 208 5800 800 or send a message via our contact page. You can also find more information on working in Sweden here.