Sweden is a Scandinavian nation with thousands of coastal islands and inland lakes, along with vast boreal forests and glaciated mountains. Its principal cities, eastern capital Stockholm and southwestern Gothenburg and Malmö, are all coastal. Stockholm is built on 14 islands. The climate is in general mild for its northerly latitude due to significant maritime influence. In spite of the high latitude, Sweden often has warm continental summers.
Sweden is a constitutional monarchy and a parliamentary democracy, with legislative power vested in the 349-member unicameral Riksdag. It is a unitary state, currently divided into 21 counties and 290 municipalities. Sweden maintains a Nordic social welfare system that provides universal health care and tertiary education for its citizens. It has the world's eleventh-highest per capita income and ranks very highly in quality of life, health, education, protection of civil liberties, economic competitiveness, income equality, gender equality, prosperity, and human development. Sweden joined the European Union on 1 January 1995 but has rejected NATO membership, as well as Eurozone membership following a referendum. It is also a member of the United Nations, the Nordic Council, the Council of Europe, the World Trade Organization, and the Organization for Economic Co-operation and Development
Three steps to starting a business
1. Decide on the business type
Before you start a business, you must first decide on the business type. The most common business type is to start as a sole trader. That means that you, as a private individual, own, operate, and are responsible for the business. You will be personally responsible for paying your taxes and social insurance contributions, known as “personal contributions”
2. Register the company
If you intend to operate as a sole trader, you are not required to register your company with the Swedish Companies Registration Office (Bolagsverket). However, registration does protect the company name. If you do not register, someone else might register a company with the same name.
If you are going to start a limited company, a trading partnership, a limited partnership, or an economic association, you must register your company with the Swedish Companies Registration Office.
3. Register with the Swedish Tax Agency
All companies must register with the Swedish Tax Agency. When you register, you can apply for F-tax approval, register for business VAT, and register as an employer.
Starting a business in Sweden
1.Do your research
In Sweden’s on-line society, information is easy to come by, so there’s no excuse for not doing proper research before starting your business. You can check with the trade organization covering the field of work you are aiming for. They can often provide information and statistics about the size and type of companies involved in that sector, as well as the regulations that apply and the general state of the market
2.Get your network going
One of the keys to success in business is in making your network work for you, regardless of what country you're in. Swedes are very much an online breed, so as you get to know more people, use social networking tools like LinkedIn and Facebook to help you keep track of your new contacts and watch your networks grow.
3.Get permission
Certain types of businesses in Sweden require a permit to operate. Verksamt.se has a handy list of the various trades, professions, and businesses that require permits, as well as contact details for the bodies that issue them.
4.Register your business for tax
As a sole trader, your venture will be identified by your personal identity number (personnummer) which is allocated to you by the Swedish Tax Agency. Sweden has different rules and regulations about residence requirements for those moving to Sweden to start a company, depending on their citizenship. Nordic citizens (Denmark, Finland, Norway, and Iceland), do not need to register with the Swedish Migration Agency (Migrationsverket) or apply for a residence permit. Citizens of the European Union (EU) or European Economic Area (EEA) are also entitled to residence in Sweden without registering with the Swedish Migration Agency and can apply for a personal identity number.
5.Make your business plan
Having decided on what goods or services you want to sell and discovered if there’s a market for it, it’s time to start getting your dream down on paper. A good business plan is essential in getting others to listen, whether they are banks, investors, or potential customers.
Your business plan doesn’t have to belong and be complex – it is simply a statement of what you plan to do and how you plan to do it.
6.Hire staff and do it legally
Employment conditions in Sweden are regulated by the Employment Protection Act (Lagen om Anställningsskydd, or LAS, link in Swedish). This act states that employment contracts are for an indefinite term unless otherwise explicitly stated in the employment contract.
Another way to deal with your labor needs is to sub-contract to other sole traders like you – just make sure they have registered for F-tax.
7.Get your bookkeeping right
There are plenty of qualified firms out there that specialize in helping small firms like yours who will bill you an hourly rate for their services. One of the easiest ways to find a good, trustworthy accountant is to ask other entrepreneurs in the same field who they use.
8.Finance your venture
Stating the obvious – unless assignments pour in from the beginning, you’ll need to make sure you can pay your regular household bills as you get your venture off the ground. Maybe you’ll use your savings to finance your first few months, or you might build up your business slowly alongside a full- or part-time job.
9.Create routines for your business
organize yourself. Most entrepreneurs will be eager to work as hard as possible on the sales side, to begin with, but make sure you find time over for the administration side of your business too. This tip applies to any budding entrepreneur, regardless of where you are in the world.
Types of company
Sole trader
As a sole trader (self-employed) you need to register your business with the Swedish Tax Agency. You can also register with the Swedish Companies Registration Office if you want to protect your company name, but this is not mandatory.
Limited company
A limited company can be started by one or more natural persons or legal entities. When starting a limited company, you must have at least SEK 25,000 in share capital. You need to register your business with the Swedish Companies Registration Office and the Swedish Tax Agency.
Trading partnership
A trading partnership is an alternative if at least two natural persons or legal entities wish to start a business together. You need to register a trading partnership with the Swedish Companies Registration Office and the Swedish Tax Agency.
Approval for Swedish F-tax
Most businesses active in Sweden apply for approval for Swedish F-tax. When your business is approved for F-tax, your customers do not have to deduct taxes on payments made to you for work performed in Sweden.
Depending on the nature of your business, you may need to register for VAT (Value added tax, Swedish: Mervärdesskatt, Moms) and/or as an employer for PAYE.
If your business is liable for VAT, you are required to register for VAT. If you have employees (including yourself if you are working for a limited liability company) you need to register as an employer for Pay as You Earn (PAYE).
Make sure to take some time each month to review your progress and talk to your financial advisors about what taxes or other charges need to be paid. Doing so will help you compare your progress to your business plan and allow you to make adjustments while keeping you on the right side of the authorities.
Investors who establish a business in Sweden are required to obtain permits for various activities including:
|
Limited company (LTD) Trading partnership Sole trader Association |
Types of companies |
|
SEK 25,000 |
Minimum share capital for LTD Company |
|
1 |
Minimum number of shareholders for Limited Company |
|
1week |
Time frame for the incorporation (approx.) |
|
20.6% |
Corporate tax rate |
|
0%in case of resident companies 0%or30% in case of non-resdident companies, depending on whether a tax treaty is available |
Dividend tax rate |
|
12%,6% 0% : reduced rates standard rate:25% |
VAT rate |
|
100< |
Number of double taxation treaties (approx.) |
|
Yes |
Do you supply a registered address |
|
At least a representative registered with the population register. Exemptions can apply |
Local director required |
|
Yes |
Annual meeting required |
|
Yes |
Electronic signature |
|
Yes |
Is accounting/annual return required |
|
Yes |
Foreign-ownership allowed |
|
Capital gains exemption on gains from a business sale of shares. Conditions apply |
Any tax exemptions available |
Updated on Wednesday,December 23th, 2023