How To Start A Business In Sweden

Sweden has become an increasingly popular destination for entrepreneurs. This is because it not only has a strong business environment, but also a high standard of living.

Sweden is also placed in Northern Europe and has direct connections to the continent, making it a good place to start a business.

Here, we talk through everything you need to know about starting a business in Sweden. We’ll explore local taxes, what to think about before moving and how to register your business.

Moving To Sweden: What To Think About

Before you make the move, you probably want to think about a few things such as:

The Climate

If you find UK winters hard, then Swedish ones are much harder. With temperatures regularly dropping sub 0, especially in the north, the climate is definitely something to think about.

Not only that, but with Sweden being so far north, the winters can be long and dark. On the flip side, summers tend to be pleasant and light, giving residents something to look forward to.

The Cost of Living

Sweden’s cost of living tends to be higher than in the UK, especially in cities like Stockholm. Examples of expenses include:

• Housing: Rent can be high in cities, with a one-bedroom apartment in Stockholm costing about EUR 1,000 and EUR 2,000 per month (SEK 10,000 to SEK 20,000).
• Food: Food is also slightly more expensive than in the UK, with eating out costing around EUR 40 per person.
• Transportation: Public transport is reliable but also comes at a cost. A monthly transit pass in Stockholm costs around SEK 970 (£70).

Although prices can be high, Sweden is well known for its high quality social services, good infrastructure and high quality of life.
 

Language

Swedish people tend to be fluent in English, which is largely used in business settings. However, if you do plan to live in Sweden, learning Swedish can definitely help with socialising and networking.

Not only that, but given all business documents are in Swedish, an understanding of the local language can be helpful.

Taxes

Before you move, you probably want to know how much taxes you’re signing up to pay.

Taxes include:

• Corporate tax: 20.6%
• VAT: 25%
• Income tax: The tax rate varies on the local authority but ranges between 29 – 35%.

Moving To Sweden, What Visa Do You Need?

If you are a UK citizen with duel citizenship with an EU country, it may be easier to set up a business. However if you don’t, you’ll need a residence permit if you plan to live and work in the country.

You’ll need to look into locking in a work visa before you go any further. Or, if you plan to set up a company, it might be worth looking into their Startup Visa. This is specifically for entrepreneurs with a new or innovative business plan, but you will need some capital to support yourself through the process.

How To Set Up A Business in Sweden

1. Choose A Business Structure

Sweden offers a few different types of business structures, so start by choosing the right one:

• Sole Trader (Enskild näringsidkare): A structure where you’re personally responsible for all business taxes, debts and expenses.
• Limited Liability Company (Aktiebolag): A legal entity with a minimum share capital of SEK 25,000, with multiple shareholders.
• Branch: If you have a company in the UK, you may want to open a branch rather than starting a new company. This will stay under UK legislation but be able to operate on Swedish soil.

2. Register Your Business

Once you’ve made a decision on your business structure, you’ll need to register it. This happens at the Swedish Companies Registration Office (Bolagsverket), where you will register your company.

Then, you’ll need to apply for tax at the Swedish Tax Agency (Skatteverket). This registration is important to make sure the company is compliant. Once you have registered, you will receive an F-Tax number, which you will need for the next stage.

3. Open A Bank Account

A Swedish business bank account is important, especially if you need to deposit share capital. You can look at both local and international banks like Nordea, SEB, and Swedbank which can provide you with competitive offers. To open a business bank account you need:

• A Swedish residence permit
• Business registration documents
• Proof of F-tax status

If you plan to transfer money frequently between the UK and Sweden, consider using Wise or similar services to avoid high currency exchange fees.

4. Get To Know Employment Laws

If you plan to hire employees, you’ll need to know the local employment laws. These include:

Working hours: 40 hours per week.

Minimum wage: No set government minimum wage.

Maternity cover: 480 days of paid leave (split between both parents)

Social security contributions: 31.42% of gross salary and benefits.

Starting A Business In Sweden

Starting a business in Sweden can be an amazing opportunity for UK entrepreneurs looking to expand into Europe. With the right planning, organisation and documents, you can be on your way to opening a business in this exciting economy.

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