Opening a company in Sweden
Sweden was officially neutral and peaceful throughout the 20th century, which goes some way to explaining its prosperity and the security it enjoys today. With a stable economy heavily oriented toward foreign trade, Sweden is a natural choice for many international investors seeking new markets. Sweden is also firmly committed to the welfare state, and high tax rates are necessary to finance it. Therefore, professional advice on tax planning and related matters is essential if you are considering starting a business in Sweden. Contact us for details on our packages for incorporating a company in Sweden and for any other information.
The five most popular forms of company in Sweden are as follows:
- Limited liability company
- Joint stock company
- Branch of a foreign company
- Partnership
- Sole Shareholder
What are the main characteristics of a limited liability company? – A suitable type of company, even for smaller companies.
- The board of directors may be composed of a single member, plus a substitute
- The minimum share capital is 100,000 Swedish kronor (€10,713).
- The owner’s liability is limited to the company’s assets
What are the main characteristics of a joint stock company?
- Standard format for large companies
- The minimum share capital is SEK 500,000 (€53,568)
- The board of directors must have at least three members
- The CEO and 50% of the board of directors must be resident in the European Economic Area
What are the reporting obligations for companies?
Regardless of their size and whether they are joint-stock or limited liability, companies must submit annual accounts to the Registry Office. Furthermore, the annual report must be audited.
What are the main characteristics of a branch?
A foreign company wishing to establish a business in Sweden without permanent establishments can instead establish a branch. The branch must have a managing director who must be a resident of a European Economic Area country. The Swedish branch of a foreign company is taxed on its profits, as if it were a Swedish limited company, but losses may be deductible in the foreign company’s jurisdiction. All branches are required to file annual accounts and are subject to audit.
How do partnerships work?
There are two types of partnerships in Swedish corporate law. A general partnership is a business relationship between two or more people, and although the partnership may be a separate legal entity, the partners are personally liable, jointly and severally. With a limited partnership, however, there is always at least one partner with limited liability, as well as one partner with unlimited liability for all debts.
Sole Shareholder in Sweden
A sole proprietorship is a recognized form of business, but it does not constitute a legal entity. The business is managed by a single individual who is personally responsible for all debts that may arise. Annual accounts are filed as an appendix to the owner’s personal tax return, but there is no requirement for auditing.
Why invest in Sweden?
Is it easy to hire staff in Sweden?
Sweden has the world’s most educated workforce after the United States and Canada, a factor widely valued by foreign companies considering investing in the country. Unemployment has risen in recent years, and there should be no shortage of job applicants. Recruitment agencies abound in Sweden. We have our own local recruitment network—please contact us for further details.
What is the legal registration framework for those wishing to set up a business in Sweden?
There are certain rules governing foreign ownership or business operations for foreign investors considering opening a company in Sweden. Profits can be freely transferred abroad. The labor market is highly regulated and subject to laws regarding employee contracts, the workplace, and corporate decisions. Legal advice is essential before offering any type of employment contract. We will be happy to assist you; please contact us for further details.
Starting a business in Sweden
Are there financial incentives available for those wishing to start a business in Sweden?
There are no general incentives for foreign companies wishing to establish a business in Sweden. However, interest-free loans may be available for investments in regional development zones. There are specific tax breaks for foreign companies that need to hire specialized personnel from abroad, such as technical experts, researchers, and managers.
Opening a bank account in Sweden
And what are the banks like?
There’s no shortage of international and local banks in Sweden, and the banking systems are very advanced, but opening a bank account can be surprisingly difficult. Contact us and we’ll be happy to help you with this and any other aspect of the Swedish registration process.
How can I find out more about setting up a company in Sweden?
If you want to open a company in Sweden as quickly and efficiently as possible, we can help. Contact us to discuss your needs.