VAT Guide for Freelancers in Sweden

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.

If you're a freelancer looking to learn more about the VAT process in Sweden, you’re in the right place. Let's Get Started!

What are the Swedish VAT Rates?

The Swedish government levies four types of VAT rates, and you should charge the appropriate amount based on the goods and services you provide.

  • The Standard Rate - Unless the items or services you offer fall in the reduced rate or zero-rated category, you should charge the standard VAT rate of 25%.
  • The Reduced Rate of 12% - The reduced rate of 12% applies to items such as foodstuffs, hotels, and art.
  • The Reduced Rate of 6% - The further reduced rate of 6% applies to newspapers, concerts, magazines, public transport, books, etc.
  • Zero VAT Rate - Services exempt from VAT include insurance, medical, dental, social care, education, prescription drugs or drugs sold to hospitals, lottery, gambling, etc. While these products and services are VAT exempt, you should still record and report the transactions to the Swedish Tax Agency.

When should you register for VAT?

You are required to register for and charge VAT in Sweden if your services meet the following conditions: 

  1. You sell or self-supply goods or services
  2. The goods or services you sell or self-supply are liable to VAT
  3. Your sales are a commercial activity

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.

How to 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:

  • Documents containing information about your annual revenue, taxable financial transactions, and bank account information.
  • A certificate of incorporation.
  • Identification:
    • A copy of your passport and Swedish identity number (if you are a Sweden citizen)
    • A copy of the certificate of registration from the civil registry and the migration department. (If you are a European Citizen)
    • A copy of the residency card from the civil registry and the migration department, a power of attorney for the fiscal representative (If you are a non-European citizen)

If you are a non-EU expat freelancer looking to sell your goods or services in Sweden, you require a fiscal representative.

Registering Online

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.

Registering Offline

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.

Financial Obligations of VAT Registered Freelancers in Sweden

Once the registration is complete, you must make sure to:

  • Charge the correct VAT rate
  • Pay any VAT owed to the Tax Department of Sweden quarterly
  • File VAT returns
  • Maintain VAT records and a VAT account.

Furthermore, every VAT-registered individual is required to:

  • Keep track of all purchases and transactions.
  • Keep a running total of their VAT account.
  • Make sure their VAT invoices are correct.

Reporting the VAT as a Freelancer

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.

How to Maintain Financial Records

As a freelancer registered for VAT, you must maintain a proper record of the following:

  • Printed copies of the invoices you send out,
  • Received invoices
  • Agreements on sell-billing.
  • The self-billing vendors' names, addresses, and VAT numbers.
  • Notes (debit/credit)
  • Records of imports and exports.
  • You must also preserve records of bank statements, check stubs, cash books, till rolls, and paying-in slips in addition to your VAT account.

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.

How Can Xolo Help?

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. 

  • Signing up takes only 10 minutes, and once you do, taxation, corporate compliance, and all the tricky VAT calculations are all automatically taken care of in the background!
  • We charge a flat rate of 5% from every withdrawal to your personal bank account. No surprise fees, no contracts, and no BS.

Xolo Leap is the easiest and most effective way to create your own company through Estonian e-Residency! Reduce time spent on mundane business administration and focus on what you do best!

  • We offer different tiers of service depending on the solopreneur’s, or as we call them, Xolopreneur's, individual needs.
  • Once you get your business set up, you can run it from anywhere in the world! So whether you’re looking to gain access to the EU market or a digital nomad - this is the place for you! 

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!