SWEDEN REAL ESTATE TAXATION 1. Acquisition of the

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SWEDEN REAL ESTATE TAXATION 1. Acquisition of the real estate investment Acquisition of the real estate property The transfer tax normally applies to the acquisition of real estate property at a rate of 4.25% for legal entities and 1.5% for private individuals. The VAT is not applicable to acquisitions in relation to the purchase of a land or a building. Acquisition of shares of a real estate oriented company This type of acquisition is not subject to transfer tax. In addition, there is no stamp duty tax or transfer tax payable on the transfer of shares. Financing the investment Swedish tax law allows full deduction of interest payments provided that an interest rate is imposed at arm’s length, except for certain restrictions on deductibility for interest on loans from foreign group companies connected to intra-­‐group acquisitions of shares. 2. Holding the real estate investment Rental activity The net rental income less deductible expenses is added to the income of the business and is thus subject to CIT at the standard rate. Only constructions are depreciable. A scale of percentages has been fixed by the Swedish Tax Agency for different types of buildings, varying between 2% and 5%. The lease of residential building is VAT-­‐exempt unless a hotel activity is performed. The lease of non-­‐residential premises is VAT-­‐exempt unless the lessor opts for a voluntary VAT-­‐
registration. The real estate tax is levied on business premises and other non-­‐residential buildings. Distribution of profits Concerning withholding tax on dividends distributed by a local company to a foreign shareholder: Autorisation d’établissement du Ministère des Finances luxembourgeois n° 26/12 en tant que Professionnel du
Secteur Financier agréé par la Commission de Surveillance du Secteur Financier luxembourgeoise.
N° R.C.S. Luxembourg B 94364
TVA LU 19788437
ING Luxembourg S.A.
IBAN LU72 0141 3413 6050 0000
BIC CODE : CELLLULL
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18 rue Robert Stümper • L-­‐2557 Luxembourg T +352 26 38 92 40 • F +352 26 38 92 41
www.finimmo.com
-­‐ 30% is subject to treaty provision; -­‐ 0% in case of dividends distributed to an EU shareholder holding at least 10% of the Swedish distributing entity. Dividends received by a local corporation are tax-­‐exempt if: -­‐ the distributing company is unlisted; -­‐ the distributing company is listed and the receiving company has held at least 10% of the voting rights of the distributing company for a continuous period of not less than 1 year; -­‐ holding of listed shares is less than 10%, the shareholding is considered held for “business reasons” and the shares have been held for a continuous period of not less than one year. 3. Selling the real estate investment Sale of a real estate property Sales made by corporate non-­‐residents are taxed as those made by Swedish companies and are subject to treaty provisions. Sale of the shares of a real estate oriented company A tax exemption on capital gain applies for: -­‐ unlisted shares; -­‐ listed shares if shareholding represents at least less than 10% of the voting rights but the shares are considered “held for business reasons”; other gains are subject to the standard CIT rate. The present document only has an informative purpose, and constitutes neither a tax advice, nor any part of a contract or an offer. Autorisation d’établissement du Ministère des Finances luxembourgeois n° 26/12 en tant que Professionnel du
Secteur Financier agréé par la Commission de Surveillance du Secteur Financier luxembourgeoise.
N° R.C.S. Luxembourg B 94364
TVA LU 19788437
ING Luxembourg S.A.
IBAN LU72 0141 3413 6050 0000
BIC CODE : CELLLULL
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