Supplementary proposals regarding taxation and payment of tax for temporary work in Sweden

Supplementary tax proposal about temporary work

The Swedish government adjusts its proposal regarding the so-called hiring out of labor rule.

Petter Frödeberg

Partner & Head of Global Mobility Services

KPMG i Sverige


In previous TaxNews we have written about the government's legislative council proposal for taxation of temporary agency work in Sweden, including the introduction of the so-called economic employer concept in Sweden. The government has sent a supplementary proposal for consideration, with a response time of August 20th.

The new memorandum sets out a supplementary proposal for the provision of temporary agency work as described in TaxNews above. The reason for the additional proposal is, according to the Ministry of Finance, that during the preparation of the bill it was found that the proposed leasing rule in its current form could catch certain intra-group situations not in keeping with the original intention of the legislation.

In order to clarify that such intra-group situations are not covered by the new rules, it is proposed that work in Sweden should, in certain cases, not be regarded as temporary agency work, even if the other conditions for being regarded as such are met.

The exception applies when the work in Sweden is performed for a maximum of five consecutive days, but no more than 30 days in a calendar year, and if the contractor and employer are included in a group of the kind specified in Chapter 1, Section 4 of the Annual Accounts Act (1995: 1554).

KPMG Comment

The Government's supplementary proposal is positive for Swedish and international corporate groups, as shorter working periods in Sweden will not result in exposure to the new taxation rules, regardless of the purpose of the business trip. The administration associated with single business trips was at risk of being excessively onerous if one intended to meet the compliance requirements of the original proposal.

The supplementary provision is proposed to come into force at the same time as the other proposals being considered by the legislative council, i.e. January 1, 2019, so it is now time to become familiar with the details in the proposal.

We invite you to contact us if you want advice on submitting a response to the legislative committee or have questions about how the overall proposal, if it is adopted by the parliament, will affect your business from as early as January 1, 2019.

Read more:
The article in Swedish

Petter Frodeberg
+ 46 8 723 96 82

Louise Hemmestad
+46 8 723 61 09

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