With effect from 1 January 2021, there are new rules for foreign companies that have employees in Sweden, or receive payment for work in Sweden.
Peab's supplier requirements from 1 January 2021
F-tax registration requirements
- From 1 January 2021, Swedish payers will be required to withhold tax (30%) for all payment for work done in Sweden, if the recipient is not registered for F-tax in Sweden.
- Peab requires foreign companies that perform and wish to continue to perform work for Peab to immediately register for F-tax.
- Information that F-tax registration in Sweden exists. For example: "Registered for F-tax in Sweden"
- Registration number linked to F-tax registration in Sweden must be stated.
- A detailed account of the work performed, including information on what work was performed, the number of hours spent, the date of performance of the work and the cost for working hours must be given.
- A detailed presentation of materials/goods included in the invoiced amount must be given.
Consequences if there is no F-tax registration
- If no information regarding F-tax registration is given or if F-tax registration in Sweden does not exist, Peab will be obliged to make tax deductions from payment for work performed in Sweden. Full payment of the invoice will therefore not be made at the time of payment. This can be avoided by registering your company for F-tax.
- You can read more about how to register your company in Sweden on the Swedish Tax Agency's website.
Foreign companies that receive payment for work in Sweden
These rules apply to foreign companies that receive payment for work performed in Sweden.
If you run a company outside Sweden, but have employees who work in Sweden - see below under "Foreign employers who have employees working in Sweden".
What has changed?
In the past, Swedish companies that pay a foreign company for work have only been required to make tax deductions from the payment if:
- the foreign company has a permanent establishment in Sweden, and
- has no approval for F-tax in Sweden.
From 1 January 2021, Swedish payers must make tax deductions regardless of whether the foreign company has a permanent establishment in Sweden or not. What determines the tax deduction will instead be where the work has been done.
The Swedish company shall only make tax deductions from salaries and other payments if the work is performed in Sweden or performed abroad but within the framework of operations in Sweden.
How much will the tax deduction be?
- The Swedish payer must deduct 30 per cent of the payment unless the Swedish Tax Agency has decided otherwise.
Foreign employers who have employees working in Sweden
These rules apply to those who run a company outside Sweden, but have employees who work in Sweden.
What has changed?
In the past, foreign employers have only been required to make tax deductions from payment for work in Sweden if they have had a permanent establishment in Sweden.
With effect from 1 January 2021, foreign employers without a permanent establishment will also be obliged to make tax deductions from payment for work performed in Sweden. Even if the work is physically performed abroad, it can be considered as work performed in Sweden if the work is within the framework of the employer's activities in Sweden.
You need to register your company as an employer in Sweden
If you are a foreign employer who is to make tax deductions, you need to register as an employer in Sweden. You register with Skatteverket (The Swedish Tax Agency).
Employer's declarations and tax deductions
As an employer you must submit employer's tax declarations and make tax deductions for your employees.