Sverige

Details

  • Service: Skatt
  • Type: Newsletter Article, Regulatory update
  • Date: 2012-11-22

Corporate tax cut and changes to the Swedish interest deduction limitation regime 

Yesterday, the Parliament decided to cut the corporate tax rate to 22 percent with effect from 1 January 2013. The new reduced corporate tax rate will be applied for fiscal years beginning after 31 December 2012. Furthermore, the Parliament adopted the Government’s bill extending the Swedish interest deduction limitation regime. The changes in the Swedish interest deduction limitation regime will take effect from 1 January 2013.

 

The new Swedish interest deduction limitation regime can be summarized as follows:

 

  • All interest on debt to affiliated companies is not tax deductible.
  • Companies are affiliated if one of them, directly or indirectly, through ownership or otherwise has a significant influence over the other or if the companies are under substantially common management. 
  • Deductions may still be allowed if the recipient of the interest income is subject to a tax rate of at least ten percent (the “10% rule”), or if the debt is primarily incurred for business reasons (the “business reason test”).
  • The “10% rule” is extended so that it applies to companies that are subject to the yield tax. 
  • The “10% rule” will not apply if the primary reason (approx. 75% or more) of the debt relationship is to obtain a significant tax advantage. 
  • The “business reasons test” is applicable only where the recipient of the interest income is located in a country in the EEA or in a country with which Sweden has an income tax treaty for the avoidance of double taxation. 
  • In assessing whether the “business reasons test” is applicable, consideration must be given to whether funding could instead have been provided through a capital contribution from the company that holds the claim or from a company that, directly or indirectly, through ownership or otherwise has a significant influence in the borrowing company. 
  • The interest limitation for back-to-back external loans will apply only for loans for financing intra-group acquisitions of shares.

 

For more information contact:

Göran Ström, Telephone +46 (0)8 723 96 05, goran.strom@kpmg.se

 

 

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Responsible Publisher 

Tina Zetterlund
tina.zetterlund@kpmg.se