Sweden will introduce the Economic Employer concept from 1st January 2021

The rules will have a significant impact on foreign employers who hire out their employees to Swedish companies and organizations. The foreign employees are also affected as they will in general be taxed from day 1 in Sweden (with no 183 day exemption) where a Swedish company or organization is considered to be the economic employer.

Also the Swedish companies and organization hiring the foreign personnel must secure that the foreign employer has made the required registrations and has a CIT decision issued by the Swedish Tax Agency. In case no CIT decision is presented, the Swedish company or organization has to withhold 30% of the invoice amount from the foreign employer.