January pay packets set to swell

The last Friday of the month means pay day in Sweden. This January is also the month in which the Alliance government's new tax deduction for employees and the self-employed comes into effect.

Björn Tennholt from the National Tax Board is able to confirm that there will be no hanging around until next year’s income returns before workers reap the financial rewards.

“People will have the money directly. It will be registered as a tax deduction on their wage slip,” he told The Local.

The month after Christmas is an uphill struggle for many. But this weekend the pubs and clubs of the nation will again swell with relieved revellers as bank accounts are finally replenished.

However, a parallel increase in monthly membership costs for unemployment insurance funds will dampen the festivities somewhat. Members of trade unions also have to contend with the hangover caused by the abolishment of a tax deduction for membership fees.

But even taking these extra costs into account, the net effect still means more disposable income at the end of the month.

Swedbank has calculated how much extra disposable income wage earners can expect per month. The bank has taken the job deduction, new tax-free allowance, earnings brackets and the new rules concerning trade union and unemployment fund fees into account.

Deduction for wage earners under 65

Monthly wage (kronor) Tax relief/month

10,000 -360

15,000 -510

20,000 -680

25,000 -840

30,000 -1060

35,000 -1060

40,000 -1090

45,000 -1130

50,000 -1130

55,000 -1130

Source: Swedbank