The reverse VAT charge shapes how cross-border services, high-risk goods, and entire industries handle tax compliance in Sweden. If you’ve ever issued or received an invoice that says “omvänd betalningsskyldighet,” you’ve already encountered it. And if your business deals in construction or international sales, you’re probably encountering the reverse charge often. Below, we’ll explain how the reverse charge works, when it applies, and how to handle it correctly.

What’s in this article?

• What is the reverse charge, and when is it used in Sweden?
  
• How does the reverse charge mechanism work in practice?
  
• What invoice wording and VAT return fields are required for a reverse charge in Sweden?
  
• How should sole proprietors account for a reverse charge on purchases and sales?
  
• Can Stripe be used for reverse charge invoicing and compliance?
  

What is the reverse charge, and when is it used in Sweden?

Reverse charge rules flip the normal value-added tax (VAT) setup. Instead of the seller collecting VAT and passing it to the government, the buyer reports and pays the VAT directly. In most cases, it’s not something the seller or buyer chooses whether or not to apply – it typically occurs in legally defined situations when both parties are VAT-registered businesses. In Sweden, here are the situations in which it will apply.

Cross-border sales

If a Swedish business sells goods or services to a VAT-registered buyer in another country, no Swedish VAT is added. The buyer handles VAT on their end. It works the same in reverse: if a Swedish business uses services from a provider abroad, it has to apply a reverse charge and report Swedish VAT on the purchase. Similarly, when buying goods from another EU country, the Swedish business needs to report Swedish VAT. In this case, it’s called an intracommunity acquisition (Unionsinternt förvärv av varor), not a reverse charge.

Construction services

There’s a domestic reverse charge rule in the construction sector. If one construction business provides qualifying services (e.g., building, installation, repairs) to another, the seller doesn’t collect VAT – the buyer reports it instead. However, this rule only applies when the work falls into certain defined construction categories.

High-risk goods and materials

To cut down on tax fraud, Sweden uses the reverse charge mechanism for certain products in specific circumstances, including:

• Scrap metal and certain recyclable materials, including batteries, laptops, and mobile phones
  
• Investment gold or gold material with at least 325 parts per thousand purity
  
• Emission permits for greenhouse gases
  

In these cases, the Invoice is issued with no VAT added, and the Buyer must report and pay the correct VAT amount.

How does the reverse charge mechanism work in practice?

When the reverse charge applies, the mechanics of VAT change, but the total tax doesn’t. Instead of the seller charging VAT and passing it to the state, the buyer does the VAT accounting internally. That shift affects invoicing and VAT reporting.

The seller issues an invoice with no VAT

The invoice should include a note that says “reverse charge” (or the Swedish equivalent: omvänd betalningsskyldighet). The seller still records the transaction as taxable in their books and includes it in their VAT return, but with 0 Swedish krona (SEK) in output VAT. Importantly, the seller can still deduct any input VAT tied to that sale (e.g., VAT on subcontractor costs, tools, or travel), even though they didn’t charge VAT.

The buyer calculates and reports the VAT

The buyer determines how much VAT would have applied if the seller had charged it. They report this as “output VAT” on their VAT return (even though they’re not the seller). At the same time, the buyer typically reports the exact same amount as “input VAT,” assuming the purchase is used for VAT-taxable business activity. The result is usually VAT-neutral – no tax is due, but both sides of the transaction are visible to the Swedish Tax Agency (Skatteverket). Both sides must be explicitly reported on the VAT return, even when they cancel each other out.

If the buyer uses the purchase for a partially tax-exempt activity (e.g., items with a mix of business and personal use), they can’t claim the full input VAT. In that case, the buyer still reports the full output VAT, but they deduct only the portion they’re entitled to and pay the difference to the state.

Example

A Swedish business buys services from a Danish consultant for 10,000 SEK. Under the reverse charge mechanism, the Swedish business buyer adds 2,500 SEK (25%) as output VAT to its return and claims 2,500 SEK as input VAT on the same return. The net tax owed is 0 SEK. But both entries are still mandatory.

What invoice wording and VAT return fields are required for a reverse charge in Sweden?

Reverse charge invoices follow a specific format. This format signals to the buyer and the Swedish Tax Agency that the buyer is now responsible for reporting the tax. To stay compliant, a reverse charge invoice must include the following:

• A note that VAT is the buyer’s responsibility: Use the phrase “Reverse charge” or the Swedish, “Omvänd betalningsskyldighet.”
  
• Both parties’ VAT numbers: The invoice must include your VAT number and the customer’s VAT number.
  
• No VAT added: Do not charge VAT on the invoice total. You have the option to show what the VAT rate would have been for informational purposes, but the total due must exclude VAT.
  

Reverse-charged transactions must also be reported using specific boxes in the Swedish VAT return (momsdeklaration). These fields vary depending on whether you’re the seller or the buyer.

If you’re the seller

• Report the net sale amount in Box 41 for domestic reverse charge sales (e.g., construction services, scrap metal).
  
• For cross-border B2B sales, where the buyer in another EU country applies a reverse charge on services, report the net sale amount in Box 3. For an intracommunity supply of goods, use Box 35. You also need to enter these amounts in the EC sales list, along with the buyer’s VAT number.
  

You won’t report any output VAT on these sales, but the sale itself is still recorded.

If you’re the buyer

Report the purchase amount in the correct “acquisition” field – usually Boxes 20 to 24. At the same time, declare the calculated VAT under “output VAT”:

• For the 25% rate: Box 30
  
• For the 12% rate: Box 31
  
• For the 6% rate: Box 32
  

Then, claim the same amount as input VAT in Box 48 (assuming the purchase is deductible).

Using these boxes ensures the transaction is visible to Skatteverket, even if no VAT was charged on the invoice.

How should sole proprietors account for a reverse charge on purchases and sales?

Reverse charge rules apply the same way to sole proprietors as they do to larger businesses. There’s no small business exemption. If a sole proprietor is VAT-registered and doing business that falls under reverse charge rules – whether they’re buying or selling – they’re expected to handle the reporting correctly.

Many sole proprietors file VAT annually rather than quarterly. Reverse-charged purchases must be included in this return, even if they happened early in the year. If a sole proprietor is selling services or goods to businesses in other EU countries, they will also need to submit a periodic summary (periodisk sammanställning) quarterly or monthly.

Can Stripe be used for reverse charge invoicing and compliance?

Stripe supports reverse charge workflows, but how much is automated depends on the type of transaction. Here’s a closer look at what Stripe can support in different scenarios.

Cross-border B2B sales

If you’re selling from Sweden to a VAT-registered business in another country, Stripe Tax will handle reverse charge logic automatically – as long as you collect the customer’s VAT number.

When that number is provided, Stripe will:

• Treat the sale as zero-rated (i.e., no VAT is applied) or reverse-charged
  
• Include the customer’s VAT number on the invoice
  
• Automatically add an invoice note such as “zero-rated intra EU supply” or “Reverse charge”
  

This setup covers most standard cross-border service and goods transactions within the EU, where the buyer is responsible for local VAT in their country.

Domestic Swedish reverse charge scenarios

Stripe doesn’t automatically apply Sweden-specific domestic reverse charge rules (such as those for construction services or scrap metal sales), but you can still use Stripe Invoicing to stay compliant.

Set your customer’s tax status to “reverse charge” in the Dashboard and ensure the invoice lists both your customer’s VAT number and yours. Then, set the tax rate to 0% manually on the invoice and add the required reverse charge wording to the invoice description or memo field. Stripe’s interface gives you control over invoice content, so you can meet the legal requirements for reverse charge invoices even when automation isn’t available.