The Swedish government will gradually reduce the special income tax rate for non-residents with income from Swedish sources (SINK), affecting pensions and short-term employment income. The changes are outlined in the 2026 budget submission and official guidance from the Swedish Tax Agency.1,2
WHY THIS MATTERS
This development is significant for organizations managing global mobility programs, especially those with employees or retirees abroad who are subject to Sweden’s non-resident taxation regime. Lower tax rates may reduce compliance costs and administrative burdens for employers, while increasing net income for affected individuals. Global mobility managers and payroll professionals should note potential adjustments to withholding and reporting requirements, and employees should be aware of changes to their tax obligations and take-home pay.
Key Highlights
Sweden’s government has announced a phased reduction in the special income tax for non-residents (statlig inkomstskatt för utomlands bosatta, or SINK). Beginning in 2026, the tax rate will decrease from the current 25 percent to 22.5 percent, and further to 20 percent in 2027. This policy change is expected to benefit approximately 90,000 individuals, with an anticipated reduction in tax revenue of SEK 340 million in 2026 and SEK 680 million annually from 2027 onward. The measure forms part of the government’s 2026 budget proposal and aims to support Swedes residing or working abroad.
Reduced SINK Rates
- 25 percent (current rate)
- 22.5 percent (effective 2026)
- 20 percent (effective 2027)
Affected Population
Approximately 90,000 non-residents receiving Swedish pensions or short-term employment income.
Fiscal Impact
Estimated reduction in annual tax revenue: SEK 340 million in 2026; SEK 680 million from 2027 onward.
Legislative Timeline
Proposal was accepted by parliament on November 26, 2025.
KPMG INSIGHTS
The reduced SINK rates reflect a broader policy intention to make Sweden more attractive for internationally mobile individuals and to ease the fiscal impact on Swedes living abroad. Organizations may need to update payroll systems and tax guidance materials to reflect the upcoming changes and may wish to review the impact on compensation packages and assignment costs.
Organizations may wish to:
- Review current and future assignments to identify affected employees.
- Adjust payroll withholding and tax reporting systems to accommodate new rates.
- Communicate upcoming changes to impacted employees and retirees.
- Monitor legislative progress to promote timely compliance with effective dates.
If assignees and/or their programme managers have any questions or concerns about the scope of the policy update, its application and potential impacts, and appropriate next steps, they should consult with their qualified tax professional or a member of the GMS immigration team with KPMG in Sweden (see the Contacts section).
FOOTNOTES:
1 (In Swedish) Swedish Government, “Statens budget 2026: Rambeslutet,” Riksdagen, published 26 November 2025.
2 (In Swedish) Swedish Tax Agency, “Rättslig vägledning,” published 27 November 2025.
Contacts
Disclaimer
The information contained in this newsletter was submitted by the KPMG International member firm in Sweden.
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