The government announced its plans for an “economic employer” concept for taxing workers who work temporarily in Sweden.
Previously, the government had planned to introduce the "economic employer” concept with respect to the taxation of workers who were temporarily working in Sweden. This proposal, however, was put on hold in 2018.
The government has again announced its intention to re-introduce the concept and that the rules would be effective 1 January 2021.
Historically, the approach applied by Swedish tax law has been that the employer is considered to be the company that pays the salary to the employee. Accordingly, this meant that foreign staff who have temporarily worked in Sweden may not have been subject to tax in Sweden because the employer paying the wages was not a Swedish company.
According to the proposal, a decisive factor for determining whether the employee is to be taxed in Sweden would be who the employee works for—and not who pays the employee’s salary. There would be exceptions provided with respect to certain intra-group situations.
Read a September 2019 report (Swedish) prepared by the KPMG member firm in Sweden
© 2021 KPMG LLP, a Delaware limited liability partnership and a member firm of the KPMG global organization of independent member firms affiliated with KPMG International Limited, a private English company limited by guarantee. All rights reserved.
For more detail about the structure of the KPMG global organization please visit https://home.kpmg/governance.
The KPMG logo and name are trademarks of KPMG International. KPMG International is a Swiss cooperative that serves as a coordinating entity for a network of independent member firms. KPMG International provides no audit or other client services. Such services are provided solely by member firms in their respective geographic areas. KPMG International and its member firms are legally distinct and separate entities. They are not and nothing contained herein shall be construed to place these entities in the relationship of parents, subsidiaries, agents, partners, or joint venturers. No member firm has any authority (actual, apparent, implied or otherwise) to obligate or bind KPMG International or any member firm in any manner whatsoever. The information contained in herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation. For more information, contact KPMG's Federal Tax Legislative and Regulatory Services Group at: + 1 202 533 4366, 1801 K Street NW, Washington, DC 20006.