Payroll in Sweden

Mercans is your trusted partner for top-quality payroll outsourcing services in Sweden. Our dedication to providing exceptional payroll solutions in Sweden is unmatched. With extensive experience in the payroll sector, Mercans guarantees precise and compliant payroll services in Sweden, positioning us as the preferred option for businesses of all scales. Count on Mercans for punctual and precise payroll processing, including the convenience of multi-currency payments in the Swedish market. As your reliable local payroll provider in Sweden, we feature a team of payroll experts well-versed in local regulations, delivering comprehensive assistance for a smooth and tailored payroll process aligned with your business requirements.

Scope of Payroll Services in Sweden

In Sweden, Mercans offers a comprehensive range of payroll services designed to meet diverse business needs:

Payroll Cycle, Working Hours and Overtime

• Payroll Schedule: In Sweden, payroll is typically processed on a monthly basis, with salaries commonly paid on the 25th of each month. Payments are made in Swedish currency.
• Working Hours: The standard workweek in Sweden consists of 40 hours, with a maximum limit of 48 hours.
• Overtime Compensation: Notably, the Working Hours Act does not stipulate additional compensation for overtime. Regulations regarding extra compensation for overtime, on-call duty, or standby time are typically outlined in collective agreements. In the absence of such agreements, employees must negotiate with their employers regarding compensation for work performed beyond regular working hours or overtime.

Minimum Wages and 13th Month Salary

• Minimum Wage: Typically, you can anticipate a minimum hourly wage in Sweden of approximately SEK 130.
• 13th Month Salary: Sweden does not mandate a 13th-month salary benefit.

Company Setup in Sweden

To trade in Sweden, new entities must register with the Bolagsverket, the organization overseeing company registrations in the country. The registration fee ranges from 1200 to 2200 SEK. If all directors hold Swedish identity documents, registration can be completed through the Bolagsverket website. For entities with at least one director who is not a Swedish national, registration must be done via the Bolagsverket eServices portal. Payment of the registration fee on either platform requires a card enabled for online transactions.

Companies with Swedish-national directors do not need supporting documents for registration; their details are automatically verified using their social security numbers. However, companies with foreign-national directors must email copies of their passports to the Bolagsverket.

Foreign sole traders or representatives of foreign companies liable for taxes in Sweden must register with the Swedish Tax Agency (Skatteverket) through its e-service. Registration entails obtaining a company registration number (for legal persons), approval for Swedish F-tax, value-added tax (VAT) registration, and employer registration. The e-service also facilitates applying for a Swedish company registration number without tax obligations.

Upon registration with the Bolagsverket, the entity receives a tax number for all tax-related communications with the Skatteverket. Additionally, the entity must register as an employer in Sweden to receive a PAYE number for submitting employees’ tax and social security contributions. Employer contributions, totaling 31.42% of the gross salary and benefit value, include health insurance, parental insurance, retirement pension, survivor’s pension contribution, labor market fee, workers’ compensation fee, and general payroll fee.

Regarding onboarding new employees, there are no regulatory forms or specific processes. However, employers must ensure that employees have permission to work in Sweden and a personal identity number. If an employee lacks a personal identity number, they must apply for one from the Skatteverket.

Payroll Processing in Sweden 

Mercans meticulously crafts and maintains an updated Processing Schedule, ensuring seamless payroll operations. Our team promptly communicates with clients, gathering all processing requirements to guarantee accuracy and efficiency.

Scope

• With careful attention to detail, Mercans verifies the completeness and accuracy of all input data, ensuring no discrepancies.
• Each aspect of the payroll process is scrutinized as Mercans balances input data totals against payroll previews, leaving no stone unturned.
• Company-wide and employee-specific changes are meticulously verified against payroll previews, ensuring precision in every calculation.
• Mercans expertly performs gross-to-net calculations, ensuring employees receive accurate compensation.
• In the event of any errors, Mercans swiftly resolves them, maintaining the integrity of the payroll process.
• Following established business rules and the Processing Schedule, Mercans processes payroll with utmost accuracy and timeliness.
• Rigorous reasonability checks are conducted to ensure the validity and consistency of payroll data.
• Before finalizing payroll, Mercans meticulously reviews the output, ensuring compliance with expectations and regulations.
• Any known payroll discrepancies requiring client direction are promptly reported, facilitating transparent communication and swift resolution.
• Mercans stands ready to assist in resolving any payroll issues beyond its scope, ensuring a smooth and hassle-free payroll experience for clients.

Client

• Clients actively participate in the payroll process by reviewing and verifying details for completeness and accuracy, ensuring alignment with their expectations.
• They provide necessary direction to resolve any identified discrepancies, collaborating closely with Mercans for optimal outcomes.

Client’s 3rd Party

• Collaborating seamlessly with Mercans and the client, third-party entities review and verify payroll details for completeness and accuracy, contributing to a comprehensive and error-free payroll process.
• They play a crucial role in balancing payroll outputs, ensuring financial accuracy and integrity across all facets of the process.

Payroll Taxes in Sweden

As of January 1, 2024, the reduced employer contributions rate for young individuals, aged 15 to 17 at the beginning of the year, has been abolished. Consequently, the employer’s contribution for this age group is now standardized at 31.42 percent.

Income Tax Rates and Brackets (2024 Tax Year)

Recurring Income:

• Age Range 15-65: Income from SEK 0.00 to SEK 999,999,999.00
  • Contribution rate: 31.42 percent
• Age Range 66-99: Income from SEK 0.00 to SEK 999,999,999.00
  • Contribution rate: 10.21 percent

Income Tax Rates:

For employees under 66 years at the beginning of the tax year

Age Range up to 65:

• SEK 0.00 to SEK 24,237.99: 0%
• SEK 24,238.00 to SEK 80,900.99: 10%
• SEK 80,901.00 to SEK 185,700.99: 21%
• SEK 185,701.00 to SEK 463,000.99: 28%
• SEK 463,001.00 to SEK 598,500.99: 34%
• SEK 598,501.00 to SEK 775,900.99: 54%
• SEK 775,901.00 to SEK 999,999,999.00: 57%

For employees aged 66 and above at the beginning of the tax year:

Age Range 66 and above:

• SEK 0.00 to SEK 24,237.99: 0%
• SEK 24,238.00 to SEK 310,800.99: 10%
• SEK 310,801.00 to SEK 463,000.99: 28%
• SEK 463,001.00 to SEK 598,500.99: 34%
• SEK 598,501.00 to SEK 775,900.99: 57%
• SEK 775,901.00 to SEK 999,999,999.00: 60%

Price Base Amount for 2024:

• SEK 57,300

These adjustments ensure compliance with the latest regulations, providing clarity and transparency in the taxation framework for both employers and employees.

Employer Payroll Contributions

Employee Payroll Contributions

Payroll Compliance in Sweden

Statutory Filings

The table below outlines the statutory filings related to payroll activities

These filings encompass various aspects of payroll administration and compliance, ensuring adherence to legal requirements and regulatory standards.

Collective Bargaining Agreements and Trade Unions

Collective Bargaining Agreements

In Sweden, collective bargaining agreements play a crucial role in regulating employment conditions across various sectors. These agreements are negotiated between trade unions and employers’ organizations and establish terms and conditions of employment, including wages, working hours, holidays, and other benefits.

Key points about collective bargaining agreements in Sweden:

• Negotiation Process: Collective bargaining agreements are typically negotiated between trade unions representing workers and employers’ organizations representing employers. These negotiations occur at both national and industry levels.
• Coverage: Collective agreements in Sweden cover a wide range of industries and occupations, including manufacturing, services, healthcare, and public administration. They apply to both unionized and non-unionized workers, as they often set industry standards.
• Scope of Agreements: Collective bargaining agreements in Sweden address various aspects of employment, such as wages, working hours, overtime compensation, vacation entitlements, sick leave, and pension contributions.
• Legal Status: Once negotiated, collective agreements become legally binding on both employers and employees within the covered scope. They establish minimum standards that cannot be undercut by individual employment contracts.
• Flexibility: While collective agreements provide a framework for employment conditions, they also allow for some flexibility. Employers and unions may negotiate additional terms or modifications to suit specific workplace needs, provided they meet or exceed the minimum standards set by the agreement.
• Enforcement: The Swedish labor market is characterized by a high rate of unionization, and unions play an active role in monitoring compliance with collective agreements. Disputes regarding interpretation or enforcement of agreements may be resolved through negotiation, mediation, or, if necessary, arbitration.
• Impact on Payroll: Compliance with collective bargaining agreements is essential for payroll management. Employers must ensure that wages, benefits, and other employment conditions align with the terms outlined in the relevant collective agreement for each employee.

Overall, collective bargaining agreements in Sweden contribute to maintaining a fair and equitable labor market by establishing standard conditions of employment and promoting cooperation between employers and employees.

Trade Unions: Global Payroll Country Guide for Sweden

Employee Benefits in Sweden

Sweden boasts one of the highest employment rates globally, with over 75% of its workforce being fully employed. In such a competitive labor market, foreign employers must offer robust benefits packages to attract and retain top talent. Here’s an overview of the key employment benefits required by law in Sweden:

• Annual Leave: As per the Swedish Annual Leave Act, employees are entitled to a minimum of 25 days of vacation per year, with benefits equivalent to 12% of their gross wages in the preceding year plus 0.43% of their monthly salary. Additional vacation days can be negotiated collectively.
• Maternity and Paternity Leave: Female employees are entitled to 14 weeks of maternity leave, split between seven weeks before and after delivery. Fathers are entitled to 10 days of paternity leave within 60 days of childbirth. Following maternity leave, both parents can take up to 480 days of paid parental leave.
• Sick Leave: Employers are required to provide sickness benefits starting from the second day up to the 14th day of illness. After 14 days, employees can apply for benefits from Försäkringskassan, covering up to 80% of their normal wages.
• Disability Leave: In Sweden, disability leave is known as “sjukskrivning” or sick leave. It’s a form of leave provided to individuals who are unable to work due to illness or disability. Swedish labor laws ensure that employees receive compensation during this time to support them financially while they recover. The length of disability leave can vary depending on the individual’s medical condition and the recommendations of their healthcare provider. Employers typically cover the cost of sick leave through a system called “sjuklön” (sickness benefit), which reimburses the employee for a portion of their lost income during the period of absence. The Swedish Social Insurance Agency (Försäkringskassan) manages the administration of sickness benefits.

Additionally, to stand out in Sweden’s competitive labor market, employers may consider offering supplementary benefits such as private health insurance, flexible working hours, additional annual leave, unlimited paid time off, remote work provisions, and mental health support. These perks, while not mandatory, can help attract and retain top talent in Sweden’s workforce.

Benefits of Payroll Outsourcing in Sweden

For our Payroll services in Sweden, we have strategically implemented a robust tool designed to operate seamlessly across diverse regions, ensuring consistency and meeting the specific needs of our clients. This tool reflects our commitment to delivering:

• Stringent Security Measures: We incorporate industry-leading security protocols to protect sensitive data, backed by ISO 27001 and ISAE3402 certifications ensuring adherence to strict information security standards.
• Consistent Performance: Our system ensures reliable and sustainable performance, capable of meeting the dynamic demands of payroll services.
• Flexibility and Scalability: We offer flexibility and scalability to accommodate evolving client requirements and adapt to changing business environments.
• Collaborative Cloud Platform: Utilizing a Cloud-based platform fosters collaboration, enhancing efficiency and accessibility across teams.

By integrating ISO 27001 and ISAE3402 certifications, we demonstrate our commitment to the highest standards of information security and operational integrity.

Key Features of Electronic Payroll Support:

• Full Traceability: Our system enables traceability throughout the payroll process, from generation to transmission and validation, meticulously validated by our expert team to ensure consistency and accuracy.
• Efficiency in Human Resources: Streamlining the payroll settlement process enhances the efficiency of the human resources department, achieving significant time savings through optimized electronic support.
• Certified Suppliers: We partner with certified suppliers holding ISO 27001 certification, ensuring the highest standards of information security. Secure data transmission processes are facilitated, bolstering the integrity of our services.

At Mercans, our adherence to ISO 27001 and ISAE3402 certifications ensures that our clients in Sweden not only benefit from cutting-edge payroll technology but also enjoy the peace of mind that comes with top-tier information security standards.

Payroll Solutions in Sweden

Discover the potential of seamless payroll processing in Sweden with Mercans’ Global Payroll Solutions. Our adaptable models guarantee local compliance, facilitate multi-currency transactions, and integrate with global Human Capital Management (HCM) and Enterprise Resource Planning (ERP) systems. Ensuring accurate payments has never been simpler.

Explore Our Adaptable Models

• SaaS (Software as a Service): Customized for large enterprises managing payroll across multiple countries, our SaaS model addresses complex challenges arising from diverse data, locations, currencies, and languages. It streamlines operations for maximum efficiency.
• Managed Services: Tailored for mid-sized and large enterprises with multi-country payroll operations, our Managed Services model provides access to on-demand HR expertise, ensuring security, reliability, and compliance.
• HRMS (Human Resource Management System): Ideal for mid to large businesses expanding their operations, our HRMS model offers a comprehensive suite of functionalities, including payroll and benefits management. Businesses can select the features they need, creating a tailored and efficient solution.

Experience payroll solutions that transcend borders, customized to meet the specific requirements of your business in Sweden and beyond.

Streamline Payroll with Mercans’ Technology and Integrations

Mercans leads the way in providing outstanding payroll services in Sweden, offering a diverse range of tailored solutions to fulfill the unique needs of our clients. Choose Mercans as your reliable partner, ensuring a smooth and effective payroll process in Sweden’s dynamic business environment.

• Cutting-Edge Technology Experience the forefront of innovation with Mercans’ state-of-the-art technology, driving our global payroll solutions. Learn more about our technological advancements here.
• Seamless IntegrationsEffortlessly integrate your Human Capital Management (HCM) systems with Mercans’ solutions, enhancing efficiency and connectivity. Explore the benefits of integration here.
• Industry Recognitions Partner with an esteemed organization recognized for excellence. Mercans has garnered accolades for its dedication to delivering exceptional payroll services. Discover our awards and recognitions here.

Outsource to Payroll Company in Sweden

In the dynamic and thriving business environment of Sweden, Mercans stands out as the premier choice for navigating the intricacies of the market as a leading payroll provider and company. With a commitment to 100% local compliance, extensive knowledge of Swedish labor laws, and a comprehensive range of services, we are the ideal partner for businesses looking to establish a successful presence in Sweden. By partnering with Mercans, businesses can harness our expertise to ensure smooth operations, statutory compliance, and a strong foundation for growth in this vibrant and promising market. With Mercans by your side, embark on a journey of success and prosperity in the heart of Scandinavia.