Bookkeeping
A non-Swedish company that has business in Sweden may have an obligation to keep accounts here. The rules differ depending on whether or not the Swedish business is operated through a subsidiary.
A non-Swedish company that operates a business in Sweden through a subsidiary has an obligation to keep accounts for that business. This applies whether or not the company has registered a subsidiary in Sweden with the Swedish Companies Registration Office (Bolagsverket).
Accounts for the subsidiary must be kept separately from the non-Swedish company’s bookkeeping records. The same bookkeeping rules apply to both the subsidiary and any Swedish company of a similar kind. The bookkeeping rules are outlined in the Swedish Bookkeeping Act, and are reflected in the regulations stated by the Swedish Accounting Standards Board (Bokföringsnämnden).
Languages
Accounting information prepared by a subsidiary must be provided in Swedish, Danish, Norwegian or English. The Swedish Tax Agency may authorise the use of another language.
Currency
The Swedish krona (SEK) must be used as the accounting currency for the subsidiary’s bookkeeping. In the case of a non-Swedish company that is equivalent to a Swedish limited company (“aktiebolag”) or Swedish economic association, the Euro (EUR) can be used as the accounting currency for the subsidiary.
Archiving and filing
Accounting records must be stored in Sweden for seven years.
Annual financial reports or annual accounts?
As a general rule, a subsidiary must close the books for the current accounting period in the same way as a Swedish company of the equivalent kind. This means that a subsidiary of any company that is equivalent to a Swedish limited company (“aktiebolag”) must produce an annual financial report. Subsidiaries to companies within the European Economic Area (EEA) that are comparable to a Swedish limited company must however prepare annual accounts rather than annual financial reports.
A non-Swedish company that does not have to register a subsidiary in Sweden has no obligation to keep accounts according to the Swedish Bookkeeping Act. On the other hand, the non-Swedish company has to fulfil a general duty to document, which applies to those that have to pay taxes and contributions in Sweden.
General duty to document
Having a duty to document means that a company must make sure that supporting documentation exists as a basis for each tax return. This also ensures that the Swedish Tax Agency can check that you have declared the right taxes and contributions.
A non-Swedish company with a permanent establishment in Sweden might need to pay income tax here in Sweden on the permanent establishment. The company must then file an income tax return, and ensure that supporting documentation exists as a basis for the return. This means that accounts or other similar records must exist for every item entered in the income tax return filed for the permanent establishment.
The company must file a VAT return if it is registered for VAT, and a PAYE tax return if it is registered as an employer. The company must then make sure that supporting documentation exists for every item declared in these returns.
Archiving and filing
In Sweden, companies must store all supporting documentation and invoices for seven years. These materials must be kept in good condition, in an orderly manner, and in a satisfactory and transparent way. Companies can apply for exemption from e-invoicing.
Bookkeeping
If you are living abroad but operating a business in Sweden, you have an obligation to keep accounts here in Sweden. You usually have to the follow the rules that apply to sole traders.
When you operate a business in Sweden as a natural person living abroad, you have an obligation to keep accounts for that business. If you own or use commercial premises, you are always considered to be operating a business. Renting out a private residential property is not considered to be a business-related activity.
Bookkeeping records for your business activities in Sweden must be kept separately from the rest of your accounts. The same rules apply both to the accounts for your business in Sweden and to Swedish natural persons who operate a business.
Languages
Accounting information that you draw up for your company must be in Swedish, Danish, Norwegian or English, but the Swedish Tax Agency may authorise the use of another language.
Currency
It must be possible to present all the dealings that you have an accounting obligation for in Sweden in the same accounting currency. The Swedish krona must be used as the accounting currency.
Archiving and filing
Natural persons living abroad to whom Swedish legislation on subsidiaries applies, and who operate businesses in Sweden, must store their accounting records in Sweden for seven years. This applies even after a business in Sweden is closed.
Annual accounts
If you operate a business in Sweden, you have to finalise your ongoing accounting with your annual accounts if you have not chosen to prepare an annual report.
In certain cases, you have no accounting obligation as a person living abroad, but you are still obliged to pay tax when operating from a permanent establishment in Sweden. You then have to fulfil a general duty to document, which applies to anyone who has to pay taxes and contributions in Sweden.
General duty to document
Having a duty to document means that you must make sure that supporting documentation exists that serves as a basis for your tax returns. This also ensures that the Swedish Tax Agency can check that you have declared the right taxes and contributions.
A non-Swedish sole trader with a permanent establishment in Sweden might need to pay income tax on the permanent establishment here. You must then file an income tax return, and ensure that supporting documentation exists as a basis for the return. This means that accounts or other similar records must exist for every item entered in the income tax return filed for the permanent establishment.
The company must file a VAT return if it is registered for VAT, and a PAYE tax return if it is registered as an employer. You must then make sure that supporting documentation exists for every item declared in these returns.
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