Sweden is an attractive destination for entrepreneurs looking to establish a foothold in the Nordic market. With a stable economy, business-friendly environment, and transparent regulatory system, Sweden offers a solid foundation for both startups and established businesses. If you are considering company registration in Sweden, here is some information on legal forms, share capital requirements, tax regime, and other essential aspects.
1. Legal Forms for Business in Sweden
When registering a company in Sweden, you can choose from several legal forms, each with its own advantages. The most common legal structures include:
- Aktiebolag (AB) – Limited Liability Company
- Enskild näringsidkare – Sole Proprietorship
- Handelsbolag (HB) – General Partnership
- Kommanditbolag (KB) – Limited Partnership
- Ekonomisk förening – Economic Association
Among these, the Aktiebolag (AB) is the most popular choice for foreign investors due to its limited liability and credibility.
2. Share Capital Requirements
The share capital requirement in Sweden varies depending on the type of company:
- Private Limited Company (Privat Aktiebolag): A minimum share capital of 25,000 SEK is required.
- Public Limited Company (Publikt Aktiebolag): A minimum share capital of 500,000 SEK is needed.
- Other business structures, such as sole proprietorships and partnerships, do not have mandatory capital requirements.
The share capital must be deposited into a Swedish bank account before the company registration process is finalized.
3. Company Registration Process
Registering a company in Sweden involves several steps:
- Choose a Company Name: The name must be unique and approved by the Swedish Companies Registration Office (Bolagsverket).
- Prepare the Articles of Association (Bolagsordning): This document outlines the company’s operations, share capital, and governance structure.
- Deposit Share Capital: If setting up an Aktiebolag, deposit the required share capital in a Swedish bank.
- Register with Bolagsverket: Submit the necessary documents and pay the registration fee.
- Obtain an Organization Number (Organisationsnummer): This serves as the company’s unique identification number.
- Register for Taxes with Skatteverket: Apply for F-skatt (corporate tax), VAT (Moms) if applicable, and employer registration if hiring employees.
4. Taxation in Sweden
Sweden has a well-regulated tax system that businesses must comply with. The key taxes include:
- Corporate Income Tax (Bolagsskatt): The corporate tax rate in Sweden is 20.6%.
- Value Added Tax (Mervärdesskatt – Moms): Standard VAT is 25%, with reduced rates of 12% (e.g., food, hotels) and 6% (e.g., books, newspapers, public transport).
- Payroll Tax (Arbetsgivaravgifter): Employers must pay social security contributions of 31.42% on gross salaries.
- Dividend Tax (Kapitalinkomstskatt): A flat 30% tax applies to dividends distributed to shareholders.
5. Banking and Financial Considerations
To conduct business in Sweden, opening a corporate bank account is essential. Swedish banks typically require:
- Proof of company registration (Registreringsbevis)
- Articles of Association (Bolagsordning)
- Shareholder details
- Identification documents of company representatives
Popular banks for business accounts include SEB, Swedbank, Handelsbanken, and Nordea. You can give power of attorney to our Damalion expert to help you to open your business bank account.
6. Hiring Employees in Sweden
If your company plans to hire staff, you must adhere to Swedish labor laws and taxation requirements. Key aspects include:
- Employment Contracts: Must comply with Swedish employment laws.
- Work Permits: Non-EU citizens need a work permit from the Swedish Migration Agency (Migrationsverket).
- Social Contributions: Employers are responsible for paying social security fees and pension contributions.
7. Business Advantages in Sweden
Sweden offers several advantages for foreign investors, including:
- Strong Economy: One of the most competitive economies in the world.
- Ease of Doing Business: Ranked among the top countries for business friendliness.
- Innovation Hub: A leader in tech, sustainability, and startups.
- Access to the Nordic Market: Provides easy access to Denmark, Norway, Finland, and the EU.
Registering a company in Sweden is a strategic move for businesses looking to expand into the Nordic market. With its stable economy, clear regulatory framework, and supportive business environment, Sweden offers excellent opportunities for foreign entrepreneurs. Whether you are launching a startup or an established firm, understanding the legal requirements, tax regime, and operational costs will help you navigate the Swedish business landscape efficiently.
If you need assistance with company registration in Sweden, banking, or compliance, contact your Damalion expert to help you to register your .
