Relocating to a new country always bring some challenges, but also opportunities. One of these challenges is the annual obligation to file a Swedish tax return with the Swedish Tax Agency (Skatteverket). This is usually quite simple, but foreign-sourced (non-Swedish) income is known to have caused expats problems, which can lead to tax penalties, surcharges, fines, and even criminal investigations.
Update 2025-01-24: The tax return filing of 2025 starts within a few weeks, during the month of February. Let us know if you want help with tax return preparation as an expat living in Sweden.
Am I obligated to file a Swedish tax return?
All Swedish tax residents are obligated to file an annual Swedish tax return. According to the Swedish tax code (Inkomstskattelagen), an individual can be tax resident according to three separate grounds:
The individual is permanently residing in Sweden
The individual is habitually spending time in Sweden
The individual has been living in Sweden, but now lives abroad and has substantial affiliation to Sweden
For individuals moving to Sweden, only the first two grounds are relevant. Unfortunately, Sweden has no set amount of days leading to status as tax resident. Internationally, 183 days is a common threshold for tax residency. However, an individual moving to Sweden usually become tax resident after six months. This has retroactive effect, i.e. the person becomes tax resident from the first day in Sweden. Exceptions can be made if the person is commuting between Sweden and another country or countries.
Sweden requires all its tax residents to file an annual income tax return. The filing deadline is on the 2nd of May, the year after the income year.
How do I file a Swedish tax return?
During the month of March, Swedish tax residents will receive a letter from the Swedish Tax Agency. The letter contains a tax return form, that usually already has some income filled. This is the taxable income that have been reported to the Swedish Tax Agency by Swedish banks, employers, governmental agencies, insurance companies, and similar.
You can choose whether you want to file a paper form, or file online. The tax return forms are only available in Swedish – which can a big obstacle for expats in Sweden. What is even more challenging for expats is to properly classify income types under Swedish Tax Law, and understand the requirements for deductions. A lot of knowledge is required to place the correct income and/or deductions in the right boxes of the Tax Return Form. Also, one must be aware of limits in deductibility, such as the limitations applying to deduct costs for travel to and from one's workplace. Non-compliance can lead to hefty penalties, and sometimes to criminal investigations.
In short, employment and pension income should be included on the main form (Inkomstdeklaration 1). Capital gains on shares should usually be included on the form K4, K12 or K10 (depending on various factors). Capital gains from selling real estate property (also real estate property not located in Sweden) should be reported on the K5 or K6 form, depending on type of ownership. No specific form is available for rental income, which is tricky since there are standard deductions applicable to this income that have to be calculated before including it in the Tax Return.
What income should be included in the Swedish tax return?
A Swedish tax resident is subject to a Swedish tax claim on the person’s global income. This include salary from a non-Swedish company, pension payments from abroad, dividends from non-Swedish companies/funds, equity distributions from foreign trusts, capital gains made in a foreign brokerage accounts or trading platforms, business income, rental income, crypto income, employee stock options, capital gains made from selling real estate outside of Sweden, and other similar income.
An expat living in Sweden do usually have some foreign sourced income that they are liable to include in the Swedish tax return. This can be somewhat complicated, since the income needs to be classified under Swedish tax law. This is particularly the case for Americans living in Sweden. Also, the risk for double taxation is generally high for expats, since the source state often levy source tax through withholding tax. It is also common that expats remain tax residents in their home country, which implies that two states have a tax claim on the same income. A Swedish tax lawyer should generally be consulted to draft the tax return, due to the complexity of expat’s tax returns. Reach out to us if you would like assistance with your tax return.
A Swedish tax lawyer will also be able to assess if you have any costs that are deductible under Swedish tax law, and if you can benefit from claiming rights under a tax treaty, which is needed to avoid double taxation, and can lead to tax savings if applied in a strategic manner. For more information on the Swedish taxation of expats, please see our Expat Tax Guide.
What are the risks if I do not file my Swedish tax return properly?
First and foremost, a late filing penalty can be levied if you file the tax return after the deadline. Should you not include income in your tax return, a tax fine of 40 % of the non disclosed tax on the income is charged. This can lead to very high tax bills. In rare cases, an individual not disclosing foreign income in the Swedish tax return can be subject to a criminal proceeding, with, at worst, brings risk for imprisonment.
How do tax treaties affect my Swedish tax return?
Sweden is part to bilateral tax treaties with multiple countries all over the world. A tax treaty can limit Sweden’s right to tax certain income. It can also grant the right to a foreign tax credit.
In general, some expats with ties to their home country, can claim benefits of a tax treaty that Sweden is part to. Such a benefit could for example be, that Sweden is not allowed to tax income with source abroad, such as a capital gain from selling real estate abroad. In order to apply the provisions of a tax treaty, one has to make a legal assessment of in which state the individual has his tax treaty residency. Always consult a tax lawyer to assist you with this.
Claiming benefits under a tax treaty is made in the annual Swedish tax return. However, there is unfortunately no form or guidance available for this. Instead, the claim has to be presented in a text appendix to the tax return, containing legal argumentation for why and how the tax treaty should be applied. This is legally and formally complex also for Swedes without legal training.
How do I get a foreign tax credit?
A foreign tax credit can either be granted under the provisions of a tax treaty, or under the Swedish domestic credit law. For example, Sweden is obligated to grant credit with withholding tax on dividends from a company in another country. This sort of claim should be included in the annual tax return.
What dates should I be aware of?
For your obligation to file an annual Swedish tax return, it is important to meet the deadline for filing on the 2nd of May 2025. However, in case you have received income from abroad during the last year, it could be a good idea to make a voluntarily tax payment, to avoid interest charges on your Swedish taxes. Since last year, the interest rate charge has been considerably increased. Therefore, we at Nomadtax often make preliminary tax calculation for expats, in order to determine what amount they should pay to avoid interest costs.
If you become client with us, you are also included in our firm's extension of the filing deadline, implying that the Swedish Tax Return must be filed at latest on the 17th of June.
Summarizing conclusions
The Swedish tax return deadline is on 2nd of May. The filing can be made online, or by using paper forms.
All Swedish tax residents are obligated to file an annual Swedish tax return.
Income from abroad is subject to tax as a main rule. However, tax treaties can limit Sweden’s right to tax certain income. Expats living in Sweden usually are required to claim the application of a tax treaty to avoid double taxation, or lower their taxes.
If you are uncertain about your Swedish Tax Return, please reach out to us.