How to pay salary to a Swedish work force

(This is just a information page and has nothing to do with me, I just have looked and searched the rules on the pages listed in this article.)

If you have a company based in Sweden, you use that to pay the salaries. You can also pay salary from a foreign based company.

The Swedish IRS (Skatteverket) must be involved in the payments. The rules are different and there are two different pages on Skatterkets homepage about those versions. You can always call the Swedish IRS (Skatteverket) to get help, the phone number is: +46 (0)771567567, you can chose to have a English customer support. Their help is free. You can also use a “Bokföringsbyrå” that handles the taxes. That is a accountancy agency. They know all the rules, accounts and such and make sure the payments are done right. You can find phone numbers at to Swedish companies that offer that service. Search for “bokföringsbyrå”.

All employees have to give you a A-skattsedel. That ones says how much tax they have to pay. That gives you the information you need to tax on each employee. This is dependent on salary and where the employee lives.

Every year you must send a “kontrolluppgift” to those that you have employed during the year.The “kontrolluppgift” must have the correct numbers and such. You need the correct country codes as well. You find information on the below links:

You can also choose to not employ. Then the person can have F-skattsedel. It means that they pay their own taxes and send you an invoice, they have their own company. If the person has A-skatt and you don’t want pay the taxes, then you must write in the contract that the employee pays its own fees. You write down the salary including fees in the contract. Then the employee pays all the fees to Skatteverket. You must still send “kontrolluppgift” every year to the employed, if you do that. There are also companies like Frilans, that handles payments and invoices so that anyone can take freelance jobs without having their own company. Frilans is then the company that pays all the fees and gives your company a invoice. You just pay the invoice. That company handles all the paper work, even the “kontrolluppgift”.

For Swedish companies:

All work that pays more than 1000SEK per year needs to be taxed.

Paid work is considered to be:

  • salary
  • benefits
  • expenses, such subsistence and mileage

Pay salary

When you pay salary you need to know what compensations you must deduct and how you calculate “arbetsgivareavgift” (it is the fees that employers must pay, they cover the Swedish welfare system contribution for the employee). It is very important to do the calculations right going through all the steps during payment of salary.

Do this when you calculate the salary

  1. Calculate how much your employees salary before taxes is (bruttlön) and any taxed benefits value.
  2. Calculate what tax reduction you have to make on the total sum of salary and taxed benefits.
  3. Calculate “arbetsgivareavgifter” from the sum of the total salary with taxed benefits.
  4. Make the tax reduction from the salary.
  5. Add tax free benefits to the tax reducted salary and pay the salaries to the employees. Give a salary specification on all posts to the employee when you pay the salary.
  6. Max a tax declaration on the tax reducations and “arbetsgivaravgifter” in the “arbetsgivardeklarationen” (employer fees declared)  and pay the taxes and “arbetsgivaravgifter” to Skatteverket (the Swedish IRS).

For foreign companies:

A foreign employer that doesn’t have a fixed company place in Sweden doesn’t need to make tax reduction on Swedish preliminary taxes on salaries paid to an employee. That goes even for those employed that must pay taxes in Sweden.

The employee must pay the preliminary taxes as specially charged  A-tax (A-skatt) (SA-skatt).

The employer normally pays fees for work done in Sweden, those fees are called “arbetsgivareavgifter”. Those are paid on top of the salary. It doesn’t matter if the employer is Swedish or foreign employer with no fixed company place in Sweden.

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