--- title: Tax relief for limited tax liability taxpayers – a possibility? description: An entity incurring limited tax liability but who requests to be taxed according to the Act on Income Tax can be covered by the regulations regarding tax relief for foreign experts, researchers and key individuals. image: https://blogg.pwc.se/hs-fs/hub/315629/file-373354067.png --- [![pwc-logo-1](https://blogg.pwc.se/hs-fs/hubfs/Imported%20sitepage%20images/pwc-logo-1.png?width=200&name=pwc-logo-1.png)](https://blogg.pwc.se/) ## Tax matters - Sweden's tax blog [‹ Back to the articles](https://blogg.pwc.se/taxmatters-en) 27 February 2018 | [Individual taxation](https://blogg.pwc.se/taxmatters-en/topic/individual-taxation) # Tax relief for limited tax liability taxpayers – a possibility? Contact [Johanna Glimmerbeck och Hanna Ekelund](https://blogg.pwc.se/taxmatters-en/author/johanna-glimmerbeck-och-hanna-ekelund) Reading time: 5 min ![Tax relief for limited tax liability taxpayers – a possibility?](https://blogg.pwc.se/hs-fs/hub/315629/file-373354067.png?width=900&name=file-373354067.png) ![Tax relief for limited tax liability taxpayers – a possibility?](https://blogg.pwc.se/hs-fs/hub/315629/file-373354067.png?width=142&name=file-373354067.png "Tax relief for limited tax liability taxpayers – a possibility?")An entity incurring limited tax liability but who requests to be taxed according to the Act on Income Tax can be covered by the regulations regarding tax relief for foreign experts, researchers and key individuals. A German citizen was employed by a German company and the company had applied for tax relief for him in Sweden. The application stated that the period of employment would be shorter than six months but that it was probable that it would be extended. The Taxation of Research Workers Board granted the application on the premise that the German citizen was liable for taxes in accordance with the Act on Income Tax (IL). The Tax Agency appealed and stated that as the period of employment was less than six months, the employee was not seen to incur unlimited tax liability in Sweden and, consequently, did not fulfill the basic premises to be able to be covered by the regulations on tax relief. The Administrative Court denied the appeal while the Administrative Court of Appeal granted it. The Supreme Administrative Court (HFD) determined that the legal text in question does not specify any requirement that an employee incur unlimited tax liability in Sweden. Instead, the Court determined that an individual incurring limited tax liability, but who requests to be taxed according to IL, should be able to be covered by the regulations on tax relief. ### Comments Based on HFD’s decision, it can be seen to be clarified that an individual residing in Sweden during a number of months, or who commutes daily to Sweden, and who incurs limited tax liability in Sweden, can be granted tax relief if he or she chooses to be taxed according to IL. According to our assessment, there are just a few individuals who incur a lower level of Swedish tax by choosing to be taxed on the basis of progressive tax according to IL together with the tax relief, instead of being taxed on the basis of the special income tax for non-residents (SINK) which is 25 percent. Those individuals who can consider being taxed according to IL, together with tax relief, are those who have high costs which they can possibly deduct in their Swedish income tax return. This can refer, for example, to deduction of travel costs to their home, foreign social security contributions or interest expenses. Furthermore, and as an example, individuals beginning to work at the end of the year and who, as a result, earn a low amount of income in that year which is to be reported in Sweden, can achieve a lower level of Swedish tax by being taxed according to IL together with the tax relief. It is possible for in individual to choose to be taxed according to IL together with tax relief for a given income year and in the following year choose to be taxed according to SINK. This can apply, for example, to an individual who is here during the period November to March and who can choose to be taxed according to IL together with tax relief for November and December, and, then, can be taxed according to SINK for the period January to March in the following year. A tax calculation needs to be executed in each individual case in order to determine the most advantageous alternative. It is also important to ensure that the application for tax relief is presented to the Taxation of Researcher Workers Board within three months after the individual begins their work in Sweden in order that the application will be processed by the Board. Should you require advice in conjunction with expert tax applications or wish to have assistance with tax calculations, you are most welcome to contact us at PwC. [![Do you have any questions on individual taxation?](https://hubspot-no-cache-eu1-prod.s3.amazonaws.com/cta/default/315629/5f1d68e7-c068-45d3-a30e-85200a4c1ac2.png)](https://hubspot-cta-redirect-eu1-prod.s3.amazonaws.com/cta/redirect/315629/5f1d68e7-c068-45d3-a30e-85200a4c1ac2) ![Johanna Glimmerbeck och Hanna Ekelund](https://blogg.pwc.se/hubfs/johanna_hanna_2.jpg) ### [Johanna Glimmerbeck och Hanna Ekelund](https://blogg.pwc.se/taxmatters-en/author/johanna-glimmerbeck-och-hanna-ekelund) Johanna Glimmerbeck och Hanna Ekelund arbetar på PwC:s kontor i Örebro respektive Stockholm med individbeskattning och frågor i internationell kontext och är särskilt specialiserade kring arbetsgivarfrågor vid gränsöverskridande personal. Johanna: 072-353 02 92, [johanna.glimmerbeck@pwc.com](mailto:johanna.glimmerbeck@pwc.com) Hanna: 070-929 44 45, [hanna.ekelund@pwc.com](mailto:hanna.ekelund@pwc.com) ## Subscribe to Tax Matters Get the latest news, directly to your inbox [Yes, I'd like to subscribe to Tax matters](https://cloud.email.pwc.se/tm-en-hubspot) ## Contact a tax advisor Do you need more information or do you have a question? 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