The Swedish Government has now published its proposed legislation, introducing an economic employer concept within the Swedish tax legislation for certain situations. When interpreting Swedish tax legislation for non-residents as well as certain tax treaties, an employer will be defined not by the organization that pays the remuneration but by the entity that benefits economically from the work. A Swedish tax liability will therefore arise for many foreign employees working temporarily in Sweden, and the foreign employer will have Swedish reporting obligations. The legislative changes are suggested to be applicable as from January 1, 2021.
A Tax Alert prepared by EY's People Advisory Services group, and attached below, provides additional details.