The Ministry of Finance on 22 January 2024 issued a memorandum proposing amendments (to be effective 1 January 2025) to the rules on deducting prior year losses in order to facilitate changes in ownership:
- The deductible amount of prior year losses after a change in ownership would be increased to 300% (from the current 200%) of the cost of acquiring control of a loss-making company.
- An exception to the rule would be introduced if a natural person (or certain other entities) gains direct control over a loss-making company, if they already had indirect control prior to the ownership change.
- The “herd rule” would be simplified to provide the deduction limitation applies when several independent natural persons acquire shares with at least 20% (currently 5%) of all votes in a loss-making company over three (current five) tax years and collectively acquire shares with more than 50% of all votes.
- The provision regarding capital contributions leading to a change in ownership when the acquirer has received a valuable asset through the capital contribution would be changed to refer only to capital contributions made to a company within the same group as the loss-making company.
Read a January 2024 report (Swedish) prepared by the KPMG member firm in Sweden