ESTABLISHING A COMPANY IN SWEDEN

Sweden is one of the respectable Scandinavian jurisdictions with high standards of doing business. It is a country with a highly developed economy and skilled workforce. It has a relatively high standard of living in general. To a large extent, it was achieved thanks to openness to foreign capital and various kinds of innovations. Registering a company in Stockholm or any other city in Sweden can access the following benefits.

Advantages of registering a company in Sweden

If you are considering registering a business in Sweden, the decision can provide access to the following advantages of the region:

• high level of economic development;
• loyal legislation for foreigners;
• developed banking system;
• absence of currency control.

Forms of doing business and legal presence in Sweden

In Sweden, it is possible to open a business or otherwise establish a business presence in one of several forms:

• A private limited company is a form of business in which the liability of the participants is limited solely to their contributions to the business. One or more participants can register a company. This is the most popular form of business chosen by non-residents. The minimum registered capital for this type of company is 25,000 SEK.
• A public limited company is a form of company that is designed for larger businesses to attract large amounts of outside financing. The firm can offer shares on the stock exchange. The liability of shareholders is limited strictly to the value of their shares. The minimum share capital is 500,000 SEK.
• A branch is an option that may be acceptable for a foreign company to enter the local market and start carrying out the same activities as those abroad at a minimal cost. However, a branch does not receive the status of a legal entity, and the parent company is fully responsible for the results of its activities. Therefore, in this case, a simple registration procedure will be required.
• A representative office is another option for a non-resident company. After a simplified registration procedure, it can promote its goods/services and explore local markets in Sweden. However, the right to conduct business and the status of a legal entity is also not granted under this option.

 

  

 

Company registration procedure in Sweden

If you want to register a business in Sweden, you can implement this decision after going through some interrelated steps:

1. First, list activities the future Swedish company plans to engage in.
2. Formulation of a unique name for the prospective company.
3. Collection of information and documents regarding the future company's shareholders, beneficiaries, and directors.
4. Search and registration of an legal address for the future Swedish company.
5. Drawing up and executing all the necessary funding and registration documents for the new company.
6. Paying the necessary registration fees and submitting documents to the Swedish Companies Registration Office. Entering information about the new company into the Swedish Commercial Register.
7. Registration for the payment of taxes and statutory social security contributions.
8. Opening of corporate bank accounts for the future company.
9. Obtaining additional permits and licenses (required for certain regulated activities).

Legislation and regulatory environment

Local legislation is very loyal to foreign capital but imposes high requirements in compliance with local standards. Local procedures are not considered to be very bureaucratic. Registration procedures for different business forms are straightforward, and remote registration is possible.

The policy of local regulators is aimed at all kinds of help in registering and doing business in Sweden. This jurisdiction is ideal for trade and IT companies, the legislation in these sectors is as flexible and focused on business needs.

Sweden's tax system

If you are considering opening or buying a company in Sweden, you should consider the following nuances of the local tax system:

• Corporate tax - 20.6%
• PIT (for non-residents) - 25%
• VAT - 25%
• Capital Gains Tax (for non-residents) - (1) Dividends - 30% (2) Interest - 0% (3) Royalty - 20.6%
• Income tax at source - (1) corporate - see corporate tax (2) individual - 30%.

How Prifinance specialists can assist

If you have set your sights on registering a company in Sweden, Prifinance specialists are ready to assist in practically implementing this business task in every possible way. The lawyers' portfolio already includes more than 11 000 cases, which are related to the registration of legal entities all over the world. Experts are ready to apply this experience to successfully start and support another business project in Sweden or any other jurisdiction.

 

  

         

STARTING A BUSINESS IN SWEDEN

If you are about to start up a business in Sweden, you need to register your business on Verksamt.

Many Swedish authorities provide information on how to start a business in Sweden and an e-service for registration with several authorities at verksamt.se.

You can start a business in Sweden as:

• a sole trader (Swedish: enskild näringsidkare), or
• through a limited liability company (Swedish: aktiebolag),
• a  trading partnership (Swedish: handelsbolag),
• a limited partnership (Swedish: kommanditbolag), or
• an economic association (Swedish: ekonomisk förening).

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.

Tax registration

Once you have registered your business with the Swedish Companies Registration Office (Bolagsverket), you need to register with the Swedish Tax Agency for taxation purposes.

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).

Learn more in our introductionfilm about starting a business. The film is subtitled in English.