In December 2023, we published a TaxNews regarding the Swedish Tax Agency’s memorandum "Stadigvarande vistelse – en definition", which proposed introducing a statutory definition of the concept in the Income Tax Act. The Government has now proceeded with the proposal and submitted a legislative referral to the Council on Legislation, largely reflecting the same content.
The concept of continuous stay (sw "Stadigvarande vistelse") is central in determining whether an individual is subject to unlimited tax liability in Sweden, and thus may be taxed on both Swedish and foreign income. Currently, there is no explicit statutory definition, and the assessment is instead based on case law, which often creates uncertainty.
The legislative referral proposes that the concept be defined based on the number of days spent in Sweden during a calendar year. Under the main rule, a continuous stay should be deemed to exist if the individual spends more than 160 days in Sweden during a calendar year. A complementary rule provides that a continuous stay is also deemed to exist if the stay exceeds 120 days, provided that the stay also exceeded 120 days in the preceding year. Only days involving overnight stay in Sweden are to be counted as days of presence.
The proposal implies that the assessment will, to a greater extent, be quantitative and linked to the calendar year, with the aim of increasing predictability and simplifying the application of the rules. At the same time, such a standardized approach reduces the scope for a more nuanced assessment in individual cases.
The legislative amendments are proposed to enter into force on 1 January 2027.
