COMPANY FORMATION IN SWEDEN

  • Overview

    Sweden, as has often been stated, presents a fascinating business model. It has proved to be a remarkably successful post-war economy, which has managed to combine both pro-business policies with the provision of an all-embracing welfare state. The Swedish business climate is known for flat organizational structures and managers who are not afraid to roll up their sleeves. Business in Sweden is constantly evolving, becoming more competitive but always with people and the environment in mind

  • Advantages of incorporating business in Sweden

    One of the world’s most globalized and competitive nations

    A long tradition of openness and free flows of trade, investment and people

    Diversified industry clusters with strong supply of skills and technologies

    Globally recognized research institutes

    The world’s second largest per capita investor in R&D

    Low corporate taxes

    Low energy prices and a resilient energy infrastructure

    Leading development of eco-friendly energy and sustainable technologies

    Excellent communications infrastructure

    Among the world’s most advanced users of new technology

    Among the quickest to adopt new applications and services, i.e. very short time to market

  • Tax Regime

    On income from capital you pay tax of 30 per cent.

    Individual income tax in Sweden is comprised of two major parts: A municipal tax rate between 28.9% and 34.2% and a national tax rate between 20% and 25%.

    There is a 25% expatriate flat tax rate for non-residents.

    The value added tax rate in Sweden is 25%, with exceptions for food and services like hotel room rental fees (12%), and for sales of publications, admission tickets to cultural events and travel within Sweden (6%).

  • Types of Entities

    Private limited liability Company: This type of company is the first option for the majority of the foreign investors. It is a type of business that can be set up by one or more natural persons or legal entities. The minimum share capital required is 50,000 SEK and it is divided into shares. However, these shares cannot be sold on the stock market.

    Public limited liability Company:
    The management structure of a Public AB in Sweden is pretty much the same as for a Private AB. The difference is that the capital provided for the incorporation must be at least 100,000 SEK and the shares can be issued on the stock market.

    General partnership:
    Setting up a partnership in Sweden requires at least two partners, who can be either individuals or legal entities. No minimum capital is necessary for establishing a partnership in Sweden. The liability of the partners is general and fully shared to the extent of their initial contributions in the partnership.

    Limited partnership:
    Limited partnerships are rather similar with general partnerships in Sweden. At least two members must set up a partnership and there is no required capital. The difference is that at least one member has to have general liability and at least one member is a limited partner, with liability to the extent of their own contribution.

    Sole proprietorship:
    This is actually considered a limited company in Sweden and it is the company that has only one shareholder. His role is also to represent the company and to be fully liable for the company’s obligations. No minimum capital is required in order to set up a sole proprietorship in Sweden.

  • Time Period

    It usually takes 16 days to set up a business in Sweden.

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