Japan — 9 min
Sweden — 11 min
If you’ve got a hole in your soul from chasing that money, money, money — and you have a dream of working for yourself — then why not take a chance on Sweden?
ABBA puns aside, this Scandinavian idyll offers a high quality of life, a famously egalitarian outlook, and the benefit of EU membership. And with a large degree of freedom in how you structure your self-employment, you can genuinely forge a living on your own terms.
Before you can get started, though, you’ll need to know how to:
Register your business in Sweden
Avoid misclassification as an employee
Create compliant contracts that protect you
Invoice and collect payments from around the world
In this article, we’ll cover all these things, and help you navigate your tax responsibilities as a self-employed worker. We’ll also discuss some of the other risks and liabilities you should be aware of, making the whole process as simple and harmonious as a classic Bjorn and Benny chorus.
So let’s begin.
First, it’s important to clarify how Sweden defines independent contractors.
Independent contractors are workers who provide paid services (or products) to another party. However, they are classified differently to employees, and are usually not entitled to the same benefits, such as paid leave, sick days, and minimum wage. On the flip side, contractors have more freedom and flexibility in the way they work.
See also: Why businesses hire contractors vs. international employees
In Sweden, there is no specific law or code that covers independent contractors. However, the Employment Protection Act (Lagen om anställningsskydd) clearly lays out the legal definition of an employer-employee relationship. Based on these guidelines, you can generally be considered a contractor if you:
Determine your own work schedule and working hours
Perform work for other companies
Set your own rates and scope of work
Provide your own tools or equipment
Are not integrated into one specific company and its operations (i.e. you don’t have an internal email address)
Are able to delegate or subcontract work
Work without direction or supervision
When you work with clients, it’s important to be correctly classified to avoid penalties and fines, and to ensure that you are paying the right taxes.
Before you can begin working as an independent contractor in Sweden, you’ll first need to choose a formal structure for your business.
The most popular model for sole owners is the sole trader (enskild näringsidkare) structure, as it’s quick and easy to set up and maintain. In this structure, you have full control of the enterprise, although there is no legal separation between you (the owner) and the business; you are personally responsible for all its debts and liabilities.
If you want more legal protection, you anticipate generating a large amount of revenue, or you’re working with additional partners (natural or legal), you can also incorporate a formal company, or enter into a partnership. If you’re unsure which structure is most suitable for your business, it’s a good idea to speak with a registered solicitor or accountant.
If you do opt for the sole trader model, you don’t need to take any formal company registration steps. However, you must register for F-tax and VAT with the Swedish Tax Office (Skatteverket) using your personal identification number (if you don’t have a number, the process is slightly different). You must also complete employer registration if you plan to hire anyone.
If your business activity is regulated (i.e. you practice a protected profession such as medicine or law, or you’re handling food), you’ll also need to acquire the relevant business permits or licenses. You can find a full list of required permits on the Swedish government website.
In Sweden, it’s also possible to work with designated self-employment companies (also known as platform companies, or invoicing companies). This is ideal if you don’t want to start a business, but still want to carry out independent assignments for various clients.
Under this system, you are still responsible for finding clients and choosing your work, but your affiliated company will handle your payroll, taxes, and other administrative tasks (for a fee).
You can learn more about this system here.
As an independent contractor, it’s down to you to handle your invoices and payment collection. Unfortunately, this means billing each client individually and collecting payment through their preferred payment method — which can be inefficient and time-consuming.
Some of the most common ways to collect payments include:
Digital transfer services like PayPal and Wise
These methods all have their own pros and cons. For instance, bank and digital transfers can be pretty quick, but often come with hefty service fees. And if you have clients in other countries besides Sweden, the payment collection process can be even more complicated.
Alternatively, you can use a trusted solution like Remote. Our platform is a simple, secure, and reliable way to get paid quickly in Swedish krona — and with no hidden fees. Learn more about how our platform can help.
As an independent contractor, you’re responsible for filing and paying your own taxes and social contributions.
The good news is that, as a sole trader, you pay personal income tax on your business profits (using your personal tax number). This means that the process is simplified, and you do not have to pay additional corporate taxes.
In Sweden, personal income is taxed at both the national and municipal level. National tax is set at a flat rate of 20% if you earn over kr 613,900 (around $59,000), while municipal tax is (on average) set at a flat rate of 32%, regardless of income.
You must also make social insurance contributions which are calculated at around 30% of your income, although it’s possible to claim tax deductions (of up to 25%) on these payments.
You must make advance payments each month, based on the tax office’s estimations of your profits. This is then checked when you complete and submit your tax return (due May 2 each year).
On the flipside, you can claim tax deductions on multiple business expenses, such as:
Vehicle maintenance and expenses
Living allowances on business trips
Tools and equipment (including maintenance)
If you sell goods or services in Sweden, then you need to charge your clients VAT. You will have registered for VAT when you set up your business.
In Sweden, the standard VAT rate is 25%, although some goods and services are charged at the lower rates of 12% and 6%.
You must submit a monthly, quarterly, or annual VAT return, depending on the size of your business. You can learn more about paying VAT on the Swedish Tax Office website.
As a sole trader, you are personally liable for finance and tax debts, which means your private assets can be forcibly used to settle your business debts. Many independent contractors purchase liability insurance to help mitigate this risk.
It’s also important to cover yourself when drafting and signing agreements with clients. Our legal experts can provide you with fully compliant contract templates, for both Swedish and international clients.
As a sole trader, you do not need to publish financial statements or accounts. However, you must still keep organized, accurate records of all your income and expenditure (including client invoices, purchase orders, bank statements, and receipts). This will help you correctly file your taxes, give you a stronger picture of your financial situation, and generally make life easier if you are audited by the tax authorities.
You can either manage these records yourself using an accounting or bookkeeping tool, or hire a professional bookkeeper or accountant.
Sole traders are not required to open a business bank account, although the Swedish Companies Registration Office (Bolagsverket) recommends doing so.
As we’ve mentioned, independent contractors are classified differently to employees in Sweden. Many of the protections and benefits employees enjoy do not typically apply to contractors.
As a result, companies may deliberately misclassify you to circumvent their legal obligations, while at other times, it may happen accidentally. Whether it’s intentional or not, misclassification can result in penalties and fines for both you and your client.
As an independent contractor, you can work with your clients to ensure this doesn’t happen. Discuss your role and responsibilities with them, and review the working arrangement regularly.
If your working relationship changes over time and you become more integrated into a client’s company, you can ask to be converted into an employee.
Open a dialogue with your client and carefully discuss the risks and benefits of moving to an employer-employee relationship. In particular, be clear about how it can benefit both parties — not just you.
You can even suggest the help of a third-party solution, such as Remote, to ease the transition. Our global employment services help both parties stay compliant by taking care of key HR functions (like payroll management and benefits administration) in line with Swedish law.
As you can see, there’s a lot to take on board when setting up as an independent contractor. Remote can help you with many of these challenges, allowing you to focus on growing your business and delivering to your clients. Here’s how:
Navigating all of your clients’ different invoicing, approvals, and payments systems can be complicated and time-consuming. And manual methods of invoicing and collecting payments can increase the risk of fees, errors, and delays.
Remote gives you access to a highly secure, streamlined dashboard that makes invoice management and international payments cost-effective and efficient. You can use our platform to get paid in Swedish krona (or other currencies), without any hidden fees.
When you draft agreements and contracts for your clients, you run the risk of non-compliance with local labor laws — especially when working with international clients. Remote offers localized contracts tailored to Swedish laws, ensuring that you stay compliant. Our legal experts can also provide guidance on complex issues, such as local classification and intellectual property protections.
With Remote, you no longer need to rely on spreadsheets and other manual tools to invoice for payments; we remove many of the inaccuracies and delays caused by archaic processes and manual management. Our platform lets you create invoices, submit them for approval, and subsequently get paid in your local currency without needing to switch to any other tool or software.
Tax management is notoriously complex work. Remote helps you quickly and efficiently deal with tax management by compiling data about your income based on your invoices and payments received.
Having the freedom and flexibility to work on your own terms is liberating. But your administrative responsibilities can distract from what you really want to be doing: helping your clients, delivering great work, and collecting invoices.
By using a stable, trusted platform like Remote, you can manage these obligations quickly and efficiently, allowing you to focus on your business goals. Specifically, we can help you:
Avoid intermediary fees and delays with international client payments
Draft compliant contracts for Swedish and foreign clients
Enhance your invoice management and avoid manual processes
Comply with local labor laws regarding work practices
Our platform makes it quick, simple, and seamless to get started as an independent contractor. Learn more about how our expertise can save you time and resources today.
Subscribe to receive the latest
Remote blog posts and updates in your inbox.