Taxable Persons

According to Chapter 4 of the Swedish VAT Act, a “taxable person” refers to any individual or organization, whether a legal entity or a natural person, who conducts economic activities independently in any location, regardless of the purpose or outcome of those activities. Thus, anyone who is engaged in economic activities in Sweden may be considered a taxable person under Swedish VAT law, even if they are not a traditional business or corporation.

Voluntary Registration

Individuals or entities that are based in Sweden and whose yearly taxable transactions in Sweden do not surpass the registration threshold may choose to voluntarily register for VAT to reclaim input VAT. However, if someone decides to register for VAT voluntarily, Swedish law mandates that they must remain registered for a minimum of two years after the year in which voluntary registration was granted. This means that they cannot terminate their registration before the expiration of this period, even if they no longer meet the criteria for mandatory VAT registration.

Exemptions from Registration

Swedish VAT Act listed the following persons as an exemption to mandatory registration:

• Established taxable persons who did not exceed the registration threshold.
• Natural or legal persons who are engaged in out-of-scope and VAT-exempt supplies.
• Any person who is not engaged in independent economic activity.

These persons who are exempt from mandatory registration may still opt to register on a voluntary basis.

Group Registration

Chapter 6a of the Swedish VAT Act enables entities that provide financial services (under the supervision of the Swedish Financial Supervisory Authority) and those in a commissionaire relationship (as defined in the Swedish Income Tax Act) to register as a group for VAT purposes.

To be registered in group, certain conditions must be met:

• Only taxable persons may become part of a VAT group.
• The VAT group may only include the part of a taxable person that is a permanent establishment in Sweden.
• The members of the group must be linked financially, economically, and organizationally.

As a consequence, for Group Registration, the supplies within group members are disregarded. Also, a single VAT return will be submitted by the head representative and the input and output VAT are “net-reported”. Aside from that, all the members of the group will be jointly and severally liable for each other’s VAT obligations.

Divisional Registration

The Swedish Tax Agency did not provide any information for divisional registration making it not applicable in Sweden.

Registration Procedures

The Swedish Tax Agency provides different options for businesses to register, as well as guides and other resources required to commence and register a company. One of these options is to register online via the Government Services for Businesses website. To use this service, a Swedish electronic identification is necessary. Alternatively, businesses can fill out a printed application form and send it via mail to the Swedish Tax Authorities.

There are two separate forms that must be filled out depending on the business:

• If the business is established in Sweden, Form SKV 4620 must be filled out.
• If the business is a foreign entity, Form 4632 must be filled out. Non-established taxable persons must also provide a registration certificate not older than six months.

The registration process normally takes up to 15 weeks to be successful.

VAT Representatives

Non-established businesses that carry out taxable supplies in Sweden and are registered for VAT have the choice to appoint a VAT representative, also known as an Ombud. However, the Swedish Tax Agency mandates that businesses established outside the EEA or Nordic region appoint a VAT representative.

The appointed VAT representative is responsible for maintaining VAT records and accounts, and accounting for Swedish VAT on behalf of the represented business. In addition, companies that submit their VAT returns electronically can also assign an agent to submit the electronic return on their behalf.

VAT representatives must meet certain qualifications:

• A resident of Sweden on a permanent basis.
• A legally established organization with a board of directors, and a physical office located in Sweden.
• A company that has a permanent establishment or ongoing operations within Sweden.

New Regulation July 2021

New regulations for the entire European Union were implemented as of July 2021, which abolished country-specific VAT thresholds in favor of a universal EU-wide distance selling threshold of EUR 10,000 or SEK 66,980. Any distance selling revenue below this new threshold will continue to be subject to VAT in the country of origin or the business’s home country. Any sales above this threshold will be taxed in the countries where the goods and services are delivered.

Last Updated: 15/09/2023

Disclaimer

The information provided by Global VAT Compliance B.V. on this webpage is intended for general informational purposes only. Global VAT Compliance B.V. is not responsible for the accuracy of the information on these pages, and cannot be held liable for claims or losses deriving from the use of this information. If you wish to receive VAT related information please contact our experts at support@gvc.tax