For members


Ten new laws that come into force in Sweden in 2021

These are some of the law changes you may want to be aware of in Sweden this year.

Ten new laws that come into force in Sweden in 2021
Some of these new laws may affect your economy. Photo: Fredrik Sandberg/TT

Standard income assessment for deferred tax on gains from housing sales abolished

When you sell a property in Sweden, you are liable to pay capital gains tax of 22 percent on any profit you make, but you can defer payment as long as you use the money to buy another home in the EU/EEA. If you bought your new house in Sweden you previously had to pay around 0.5 percent interest on the postponed tax – but that changed on January 1st, when Sweden scrapped these interest payments.

According to the Tax Agency (Skatteverket), this means that if you sold your home in Sweden 2014-2019, you may be entitled to money back. If you think this applies to you, you should contact Skatteverket, and you can also read more (in Swedish) here.

Deduction for household work expanded and ceiling raised

Sweden's RUT tax deductions, which means you can get money back on your taxes if you've had cleaning work done in your home, were expanded on January 1st.

This means that it now includes for example sending your clothes to a professional cleaner, furnishing services, and transporting old items to for example a second hand shop. The cap has also been raised to 75,000 kronor.

The Local's guides to your Swedish money:

Sweden's RUT deductions become more generous in 2021. Photo: Jonas Ekströmer/TT

Financial employer concept introduced for people living abroad but working temporarily in Sweden

On January 1st, Sweden introduced a new 'financial employer concept' to cover people who usually live abroad but are temporarily working in Sweden, and determine how income taxes should work for that person. The new law states that the key factor will not be who the employer is, but rather on whose behalf the work is carried out.

Provisions on registration of drone operators introduced

New rules for drone operators came into force on January 1st. This means that people who want to fly drones heavier than 0.25 kilos will have to apply for a drone licence, and a person in charge of flight will need to register for an operator ID.

Passport fees raised by 50 kronor

Those who wish to apply for a Swedish passport have to pay 400 kronor, rather than 350 kronor, as of January 1st. The reason is that the Police Authority's passport offices have been running a deficit in recent years.

Youth supervision – a new penalty for young offenders

This new rule, which came into force on January 1st, means that young offenders can be sentenced to ‘youth supervision', a sentence that will be delivered in cases where other kinds of penalties for young offenders are not harsh enough to reflect the nature of the crime or the person's previous criminal record. In practice, it could mean a curfew, or being barred from certain places.

Young offenders could be handed a curfew order. Photo: Johan Nilsson/TT

Tax reduction introduced for people who make green investments

From January 1st, people who make green investments can get tax deductions of 15 percent for solar cells and 50 percent for storing self-produced electrical energy and charging points for electrical vehicles – although no more than 50,000 per person and year. The new model will be similar to tax deductions for cleaning and home renovation services (ROT & RUT) so the buyer will benefit at the point of purchase.

Introduction of a regional tax reduction in certain sparsely populated municipalities

This one came into force on December 1st, 2020, but takes into account the start of the tax year beginning after December 31st, 2019. It means that people who live in certain rural municipalities – mainly in Norrland and north-western Svealand – will get a tax cut of 1,675 kronor per year.

Supplementary provisions in the Withdrawal Agreement between the UK and the EU

The post-Brexit transition period ended on December 31st, 2020, which means that new regulations that came into force in Sweden on December 1st have now fully replaced the previous ones. For Brits in Sweden, this means that they will have to apply to the Swedish Migration Agency for a new residence status to protect their future in Sweden.

Provisions on reduction in employers' social security contributions for the first employee made permanent

Since 2017 it has been possible for some one-man operations to reduce social security contributions when they hire their first employee. These rules were temporary and set to expire at the end of 2021, but will instead become permanent from January 1st, 2021.

These are examples of some of the new laws that come into force in Sweden in 2021. A full list of all laws, including temporary laws introduced as a result of the coronavirus pandemic, can be found in English here, and a more thorough explanation in Swedish here.

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For members


Pensions in the EU: What you need to know if you’re moving country

Have you ever wondered what to do with your private pension plan when moving to another European country?

Pensions in the EU: What you need to know if you're moving country

This question will probably have caused some headaches. Fortunately a new private pension product meant to make things easier should soon become available under a new EU regulation that came into effect this week. 

The new pan-European personal pension product (PEPP) will allow savers to take their private pension with them if they move within the European Union.

EU rules so far allowed the aggregation of state pensions and the possibility to carry across borders occupational pensions, which are paid by employers. But the market of private pensions remained fragmented.

The new product is expected to benefit especially young people, who tend to move more frequently across borders, and the self-employed, who might not be covered by other pension schemes. 

According to a survey conducted in 16 countries by Insurance Europe, the organisation representing insurers in Brussels, 38 percent of Europeans do not save for retirement, with a proportion as high as 60 percent in Finland, 57 percent in Spain, 56 percent in France and 55 percent in Italy. 

The groups least likely to have a pension plan are women (42% versus 34% of men), unemployed people (67%), self-employed and part-time workers in the private sector (38%), divorced and singles (44% and 43% respectively), and 18-35 year olds (40%).

“As a complement to public pensions, PEPP caters for the needs of today’s younger generation and allows people to better plan and make provisions for the future,” EU Commissioner for Financial Services Mairead McGuinness said on March 22nd, when new EU rules came into effect. 

The scheme will also allow savers to sign up to a personal pension plan offered by a provider based in another EU country.

Who can sign up?

Under the EU regulation, anyone can sign up to a pan-European personal pension, regardless of their nationality or employment status. 

The scheme is open to people who are employed part-time or full-time, self-employed, in any form of “modern employment”, unemployed or in education. 

The condition is that they are resident in a country of the European Union, Norway, Iceland or Liechtenstein (the European Economic Area). The PEPP will not be available outside these countries, for instance in Switzerland. 

How does it work?

PEPP providers can offer a maximum of six investment options, including a basic one that is low-risk and safeguards the amount invested. The basic PEPP is the default option. Its fees are capped at 1 percent of the accumulated capital per year.

People who move to another EU country can continue to contribute to the same PEPP. Whenever a consumer changes the country of residence, the provider will open a new sub-account for that country. If the provider cannot offer such option, savers have the right to switch provider free of charge.  

As pension products are taxed differently in each state, the applicable taxation will be that of the country of residence and possible tax incentives will only apply to the relevant sub-account. 

Savers who move residence outside the EU cannot continue saving on their PEPP, but they can resume contributions if they return. They would also need to ask advice about the consequences of the move on the way their savings are taxed. 

Pensions can then be paid out in a different location from where the product was purchased. 

Where to start?

Pan-European personal pension products can be offered by authorised banks, insurance companies, pension funds and wealth management firms. 

They are regulated products that can be sold to consumers only after being approved by supervisory authorities. 

As the legislation came into effect this week, only now eligible providers can submit the application for the authorisation of their products. National authorities have then three months to make a decision. So it will still take some time before PEPPs become available on the market. 

When this will happen, the products and their features will be listed in the public register of the European Insurance and Occupational Pensions Authority (EIOPA). 

For more information: 

This article is published in cooperation with Europe Street News, a news outlet about citizens’ rights in the EU and the UK.