Value-added tax (VAT) reporting is one part of running a sole proprietorship in Sweden that can be prone to errors. Some of the biggest mistakes are the result of not knowing what Skatteverket (the Swedish Tax Agency) expects or assuming a certain box, deduction, or invoice won’t matter. Below, you’ll find a guide on how VAT reporting works for Swedish sole proprietors and how to get it right.

What’s in this article?

• What are the VAT reporting obligations for sole proprietors in Sweden?
  
• How do you prepare your VAT return as a sole proprietor?
  
• Which VAT boxes typically apply to sole proprietors?
  
• What counts as deductible input VAT for a sole proprietor?
  

What are the VAT reporting obligations for sole proprietors in Sweden?

If you run a sole proprietorship in Sweden, VAT registration is required when your annual turnover exceeds 120,000 Swedish kronor (SEK). Sole traders with lower turnovers also need to register in certain circumstances, including if they sell services to other EU countries or purchase goods from them for more than 90,000 SEK in one year.

Registration is usually optional below the 120,000 SEK threshold. You won’t have to charge VAT or file VAT returns, but you also can’t deduct the VAT you pay for business expenses (i.e., input VAT). Many small-business owners register even when they’re below the threshold so they can reclaim input VAT and signal a more established presence.

Once you’re registered for VAT, here’s what you’re expected to do:

Charge the correct VAT rate on your sales

Most goods and services are taxed at the standard VAT rate of 25%. There’s a reduced rate of 12% on certain sales including food, restaurant meals, and hotel stays. And there’s a 6% rate for things such as books, newspapers, and sports activities.

Invoices must clearly show the VAT rate and amount along with your VAT registration number.

Keep records for at least seven years

You must maintain accurate records that track output VAT (what you charge customers) and input VAT (what you pay on purchases) through documentation such as invoices, receipts, and customs forms. Skatteverket expects you to retain this documentation for at least seven years. You’ll need it if you’re audited.

File VAT returns on the correct schedule

Once you’re registered, you must submit a VAT return for every reporting period. Even if you didn’t issue an invoice in one period, you still file – just with zero output VAT.

Your reporting frequency is based on your turnover:

• Annual reporting is available if your turnover is less than or equal to 1 million SEK. If your business doesn’t need to file an income tax return or if it trades with other EU countries, the deadline is the 26th of the second month after the tax year ends. If your business files income tax returns and doesn’t trade with other EU countries, the deadline is 12 May of the year following the tax year.

• Quarterly reporting is available if turnover is less than or equal to 40 million SEK. The deadline is typically the 12th of the second month after each quarter ends.

• Monthly reporting is mandatory if turnover exceeds 40 million SEK. The deadline is the 26th of the following month, except for December – December returns are due 27 January.

• Businesses that haven’t exceeded the 40 million SEK threshold can opt for monthly reporting if they prefer more frequent reconciliation. For them, the deadline is usually the 12th of the second month after the reporting period, except for January and August – these returns are due the 17th.

Pay VAT, or claim a refund

For each reporting period, you’ll pay the VAT you owe (if your output VAT is greater than input VAT) or get a refund (if input VAT is greater). You can pay online through Skatteverket’s VAT e-service (available in English and Swedish). You’re responsible for paying on time.

You still need to file a nil return (i.e., when you haven’t collected any VAT during the period) on time to avoid penalties.

How do you prepare your VAT return as a sole proprietor?

Filing VAT as a sole proprietor requires careful recordkeeping and accurate documentation of your business activity. Track all income and expenses as they happen, including:

• The VAT you charge

• The VAT you pay

• What’s taxable, what’s exempt, and what falls under special rules (e.g., imports, EU services)

Use software, a spreadsheet, or any system that can break things down by VAT category. That structure will match the fields you need to fill out on the return.

When you file your VAT return, calculate four totals for each VAT period:

• Taxable sales, excluding VAT

• Output VAT charged on sales, separated by VAT rate (25%, 12%, 6%, or 0% for zero-rated or exempt purchases)

• Output VAT combined

• Input VAT paid on deductible business purchases

If you use the cash accounting method, report sales and purchases on your VAT return based on the payment date. If you use accrual accounting, report them based on the invoice date. If you bought goods or services from outside Sweden that count as reverse charge transactions, declare them as if you were the customer and the seller – put output VAT and input VAT on the same return.

Before you submit, check everything twice:

• Do your VAT totals match your invoices?

• Did you break down your output VAT by the correct rate?

• Are you claiming input VAT only on purchases that qualify?

• Did you handle all cross-border or special-case purchases correctly?

Once you’re confident everything is correct, submit the return. If you owe VAT, pay it by the due date. File even if you had no sales or expenses – just enter “0” where applicable. Skatteverket doesn’t waive penalties just because your business was quiet during a period.

You can file early. This gives you more time to arrange payment if you owe VAT.

Which VAT boxes typically apply to sole proprietors?

Sweden’s VAT return is organised into a long form with lettered sections and numbered boxes. Each field represents a specific type of sale, purchase, or tax amount.

Here are the boxes you’ll likely interact with as a sole trader and how to fill them out:

Section A (Sales liable to VAT)

Box 05 (Taxable sales not included in other boxes below)

Report all sales liable to Swedish VAT (excluding the VAT amount) that aren’t included in other boxes below. It doesn’t matter whether you charged 25%, 12%, or 6% VAT. Just enter the total pre-VAT revenue.

Section B (Output VAT on sales liable to VAT)

Report the actual VAT you charged on the sales in Section A, broken down by rate:

• Box 10: Output VAT at 25%

• Box 11: Output VAT at 12%

• Box 12: Output VAT at 6%

If you charge only the standard rate, you’ll use only box 10. If you charge at multiple rates, separate the amount accordingly.

Section C (Reverse charge purchases)

If you bought goods or services from other countries or bought certain domestic services with reverse charge rules (e.g., construction), you need to self-account for VAT as the customer:

• Box 20: Goods purchased from other EU countries

• Box 21: Services purchased from other EU countries

• Box 22: Services purchased from outside the EU

• Box 24: Services purchased in Sweden where the reverse charge mechanism applies

Section D (Output VAT on reverse charge purchases)

Report the output VAT rate charged on reverse charge purchases:

• Box 30: Output VAT at 25%

• Box 31: Output VAT at 12%

• Box 32: Output VAT at 6%

Section E (VAT-exempt sales)

Report any sales that were exempt from VAT. These are the common boxes for sole proprietors:

• Box 35: Goods sold to EU businesses

• Box 36: Goods exported outside the EU

• Box 39: Services sold to EU businesses

Section F (Input VAT)

Box 48 (Input VAT to deduct)

Add up all deductible VAT from your business purchases, including:

• VAT paid for domestic expenses

• VAT paid for goods or services purchased from EU countries

Include only purchases that are deductible. Not everything with VAT on it qualifies.

Section G (VAT to be paid or refunded)

Box 49 (VAT to pay or get back)

This is the total of the amounts in boxes 10, 11, 12, 30, 31, 32, 60, 61, and 62 minus the amount in box 48. You can use accounting software to get the correct totals automatically, but be careful not to duplicate or omit transactions. If the result is positive, that’s what you owe Skatteverket. If it’s negative, that’s the refund you’re owed.

What counts as deductible input VAT for a sole trader?

When you buy goods or services for your business and pay VAT on them, you can usually deduct that VAT in your return. Input VAT offsets the VAT you charge on sales. But not everything with VAT on it is deductible. Some expenses qualify fully, while others don’t qualify.

Deductible expenses

You can reclaim VAT on purchases that are:

• Directly related to your VAT-liable business activities

• Documented with valid invoices

• Used for your business (not private use)

These purchases often include:

• Inventory, raw materials, and supplies

• Business equipment (e.g., computers, tools, phones)

• Software, subscriptions, and licenses

• Advertising and marketing services

• Professional services (e.g., accountants, legal fees, consultants)

Deduct input VAT in the same period you receive the invoice (if you use accrual accounting) or when you pay it (if you use cash accounting). You don’t need to wait until the item is used or delivered.

Non-deductible expenses

Under Swedish VAT regulations, you cannot deduct input VAT for personal expenses. If an item is partially for personal use (e.g., your phone, internet), you must estimate what portion is a business expense and prorate it. If you can’t show a clear breakdown of this split, you can’t deduct the VAT.

Here are some nondeductible or partially deductible expenses:

• Passenger cars: You cannot deduct VAT on the purchase of a passenger car – even if it’s used for business activities. Only taxi drivers, driving instructors, and car dealers can deduct VAT on cars.

• Entertainment and client gifts: Business entertainment expenses (e.g., business dinners, expensive gifts) are not deductible on VAT returns or income tax returns. Business gifts are partially deductible but only up to 300 SEK per person (excluding VAT). Expenses such as theatre tickets and golf green fees are partially deductible, up to 180 SEK per person per occasion (excluding VAT).

Skatteverket expects detailed proof for every deduction. Keep invoices that show the supplier’s VAT number, amount charged, and what you bought as well as receipts that clearly list VAT and notes or annotations that explain how each item is used in your business. Keep calculations of the business use share for any mixed-use purchases. In case of an audit, you need to show that every VAT deduction listed on your return is grounded in a real, traceable business use.