Company Setup in Sweden

Swedish Incorporation

• 

  Ongoing Obligations

  Companies must maintain accounting records in compliance with Swedish GAAP or IFRS, prepare annual financial statements, and file them with Bolagsverket. Corporate tax returns are filed annually, and VAT returns are generally monthly. An audit is mandatory if a company exceeds two of the following: turnover above SEK 3 million, assets above SEK 1.5 million, or more than 3 employees. All companies must maintain a Beneficial Ownership Register and comply with labour, social security, and AML regulations.

• 

  Business Structure Requirements

  The most common business entity is the AB (Aktiebolag / Limited Liability Company). It requires at least one shareholder and one board member, who can be of any nationality. However, at least half of the board members must reside within the European Economic Area (EEA) unless an exemption is granted. A registered office address in Sweden is mandatory. 100% foreign ownership is permitted, and the company must register with the Swedish Companies Registration Office (Bolagsverket).

• 

  Capital Setup

  A Private AB requires a minimum share capital of SEK 25,000 (approximately €2,200), while a Public AB requires SEK 500,000. The capital must be paid before incorporation, either in cash or in approved non-cash assets. Shareholder liability is limited to their capital contribution, and additional capital can be raised through share issues if needed.

• 

  Taxes

  Sweden’s corporate income tax rate is 20.6%, one of the lowest in Western Europe. Dividends and capital gains on qualifying shareholdings are often exempt, and Sweden has over 90 double-tax treaties. The standard VAT rate is 25%, with reduced rates of 12% (food, hotels) and 6% (books, transport, cultural services). Sweden also provides R&D tax deductions and credits for environmentally sustainable business investments.