VAT payment is compulsory for anyone, including freelancers, who conduct economic activities in Sweden. As per the “destination principle” of the EU VAT system, if you have consumers in Sweden, you must follow Swedish VAT guidelines regardless of where you’re located. Sweden charges a high standard VAT rate of 25% and offers reduced rates of 12% and 6% for certain goods and services. The Swedish Tax Agency is in charge of the VAT system and is also responsible for publishing content related to the management of the Swedish VAT system.
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The Swedish government levies four types of VAT rates, and you should charge the appropriate amount based on the goods and services you provide.
You are required to register for and charge VAT in Sweden if your services meet the following conditions:
If your annual sales turnover is less than SEK 30,000, you are not obliged to register for VAT. However, if you are remotely selling to clients in Sweden from another EU member state and your sales turnover exceeds SEK 320,000, you will be liable to register for VAT in Sweden.
Additionally, you can click here to check out other scenarios that determine when you must register for VAT in Sweden.
After determining if you’re eligible to register for VAT in Sweden, you should prepare the following documents for submission:
If you are a non-EU expat freelancer looking to sell your goods or services in Sweden, you require a fiscal representative.
You can use your Swedish identity number and register for VAT online on this official website. You will receive approval in a few days. Note that the website content is offered only in Swedish.
If you do not have a Swedish identity number, you can apply for registration through the SKV 4620 form. You need to fill the form, print it, sign it and submit the original copy to the tax agency of Sweden.
If you’re unable to register online, you can submit the documents mentioned above in-person or by post to the Swedish Tax Agency. The 'effective date of registration' is the day on which you registered. From this date forward, you must pay VAT to the Swedish Tax Agency.
Alternatively, you can also register using the Mini One-Stop Shop, an EU-wide tax system that allows you to consolidate all of your EU VAT in one single tax return. This scheme is optional but convenient and especially useful if you have customers in multiple countries within the EU, including Sweden. MOSS allows you to avoid registering in each member state of consumption. To learn more, click here.
Lastly, you can hire an accountant (or agency) to handle your VAT returns and dealings with the Swedish Tax Administration. Xolo provides services like Xolo Go and Xolo Leap, which help with precisely this and any other VAT concerns you may have.
Once the registration is complete, you must make sure to:
Furthermore, every VAT-registered individual is required to:
If your total turnover is less than SEK 1 million per year, you need to report VAT once a year.
If your total turnover is between SEK 1 million and SEK 40 million, you need to report VAT every quarter.
If your total turnover exceeds SEK 40 million, you must report VAT once a month.
As a freelancer registered for VAT, you must maintain a proper record of the following:
Additionally, freelancers who provide services to multiple countries in the EU can use the aforementioned VAT MOSS system. You can set up a system to pay VAT only to the Swedish government even while working with clients in the other countries around Europe. You must maintain your VAT records for six to ten years if you use VAT MOSS. These records can be stored electronically, on paper, or in a software application.
Xolo can help you stay 100% VAT compliant and never miss out on any steps! We automatically generate, send, and store all your invoices digitally, so you won’t have to worry about misplacing them over the next decade.
The tax registration process can be tricky at times, but we hope this guide has helped clear your doubts! If you’re still confused about the different schemes and numbers and paperwork, Xolo offers a range of solutions that handle all the hassle while you focus on your core competencies.
With Xolo Go, you can easily freelance and invoice your clients, even without a registered company or LLC.
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Simply put, we do the hefty work for you so that you can enjoy the freedom of freelancing. So connect with us immediately, and we’ll help you get your one-person business up and running in Sweden in no time!