Maximising R&D Incentives: Swedish Government Raises Deduction Threshold

In a move that's set to boost innovation and research, the Swedish government has introduced a significant increase in the threshold ceiling for companies engaged in Research and Development (R&D) activities. As of July 1, 2023, this policy change introduces a new maximum deduction of SEK 3,064,129 per calendar month, bringing with it a wave of opportunities for companies investing in R&D.

How is the maximum deduction calculated? 

Under the updated policy, the maximum deduction is meticulously calculated to strike a balance between incentivising R&D efforts and maintaining financial sustainability. The core of this calculation revolves around two key components: the deduction from actual employer's social security contributions for R&D-involved employees and the corresponding reduction in the general payroll tax. 

The first aspect ensures that the deduction from actual employer's social security contributions doesn't exceed SEK 1,500,000 per calendar month. This cap is in place to prevent excessive deductions that could potentially strain the government's social security funding. 

Complementing this cap, companies are granted the ability to reduce the general payroll tax by a significant 10 percentage points. This reduction, equivalent to SEK 1,564,129 per calendar month, is based on a specific salary basis.  

When combined, these two deductions pave the way for a substantial reduction in financial burden for many companies. 

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What is the purpose of the deduction?

The Swedish government's decision to implement a tiered approach to deductions ensures that the incentives are distributed fairly and judiciously among companies engaged in R&D activities. By capping the deductions and providing a balanced approach between social security contribution deductions and payroll tax reductions, the policy encourages businesses to actively participate in R&D, while maintaining fiscal responsibility.

Up to 6 years R&D retroactive claims

It's important to note that the Swedish tax agency accepts retroactive claims for up to 6 years. This means that if you've missed out on previous opportunities, there's still a chance to recoup those benefits.  

Aspia: Your R&D deduction experts 

If you're a company invested in R&D activities or seeking to explore the possibilities that the new deduction policy offers, or simply you are curious of what this means about your company, don't hesitate to get in touch with us.  


Författare av detta blogginlägg:
Milena Boyanova
Milena Boyanova works as Director | R&D Advisory | Expatriate Payroll in Stockholm.