5 mars 13:00
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Start your own business? Skatteverket gives advice

The Swedish Tax Agency, Skatteverket, visits us in the studio and gives advice about: How do you choose a business structure? What is the difference between F-tax and FA-tax? We discuss business plans and support from the Swedish Public Employment Service. Part 1 of 2.

  • Start your own business support
  • How to choose a business structure
  • Difference between F-tax and FA-tax

[intro music]

Ziza Madani:
Do you have a dream of starting your own business? Do you have a lot of great ideas but are unsure about the next steps? Keep listening and we will try to point out the direction for you.

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Ziza:
In this episode we will provide tips and advice together with Skatteverket, the Swedish Tax Agency. Welcome to the “New in Sweden” podcast, where we provide helpful tips and advice on job hunting and employment opportunities in Sweden. This podcast is aimed at those of you who are new to the country. Today, we have an exciting topic lined up for you: “Starting your own business – what you need to know”. My name is Ziza Madani. Joining me in the studio is my colleague, Pär Axelsson. We both work here at Arbetsförmedlingen, the Swedish Public Employment Service. Stay tuned for our guest, Ulf Nilsson from Skatteverket, who will share his expertise shortly.

Pär:
Ziza, it all starts with a business idea, doesn't it?

Ziza:
Absolutely. They say a strong business idea is key to any enterprise. A well-crafted idea increases your chances of success. Once you've identified your business concept, it's crucial to express it concisely. Just a few sentences will do.

Pär:
Hmm… Can you explain what a business idea really is?

Ziza:
If you're thinking about starting a business, you need an idea that can generate income. It could be a product or a service you plan to sell or offer. In essence, your business concept defines what you’re selling, how you will sell it, and to whom. It should also highlight your company's strengths and its unique selling points.

Pär:
Okay, that’s great. Now, if I have a promising business idea and I'm registered with Arbetsförmedlingen, what's my next step?

Ziza:
You begin by sharing your business idea with Arbetsförmedlingen. If you and an employment officer agree that starting a business is suitable for you, you'll be encouraged to write a business plan. This plan should detail your business idea and outline a budget for your company's finances.

Pär:
Business plan… Writing a business plan sounds like a bit of a challenge. Are there any resources to help you?

Ziza:
For those unsure about how to create a business plan, we offer training sessions following an evaluation by Arbetsförmedlingen. Training sessions include guidance on budgeting, accounting, taxes, and contracts. A good tip is that you can find information on creating a business plan at verksamt.se.

Pär:
Okay. Now, you have a business plan. What comes next?

Ziza:
Once your business plan is ready, it's sent to one of our approved suppliers for assessment. If it gets the green light, you will receive start-up support, which lasts for 6 months.

Pär:
Start-up support, how does that work?

Ziza:
It's important to understand that the start-up support isn't an extra benefit. Rather, it's a way to maintain the financial support you already have. If you're currently receiving unemployment benefits, “a-kassa” in Swedish, you will continue receiving the same amount as activity support, “aktivitetsstöd”. If you're already on activity support, it remains unchanged. For those with disabilities, there's financial aid available to cover business start-up costs. To explore the support options from Arbetsförmedlingen, check our website at arbetsformedlingen.se.

Pär:
Good. Are there any other forms of support?

Ziza:
Yes, you can get advice on what to think about and find out before and during the start-up of the business from Arbetsförmedlingen. In addition, you can receive guidance from a mentor, a so-called mentor support. A very important thing: Do not start a business before you get an approval from Arbetsförmedlingen.

Pär:
Approval… Why is that so important?

Ziza:
If you start your business before you get a green light from Arbetsförmedlingen, you won't get any financial support. In other words, you should not start the company before you get an approval from Arbetsförmedlingen.

Pär:
Do you need a permit?

Ziza:
Before you start your business venture, find out if any permits are necessary. Permits are needed for specific fields, such as food sales, hairdressing, or taxi services. To get the permits, your business must meet the requirements set by various authorities. You can explore the available permits on the website verksamt.se.

Pär:
Super good. So, when setting up a business, the choice of company structure is critical. Ulf Nilsson is here to guide us. He is a Tax Information Officer at Skatteverket.

[music]

Pär:
Welcome, Ulf.

Ulf:
Thank you. It’s a pleasure to be here.

Pär:
To start off, there are different types of companies, right?

Ulf:
Oh, yes. The most common types are sole trader, or “enskild firma” in Swedish, and limited companies, “aktiebolag”. But there are options as well, including trading companies and economic associations. The choice of structure depends on factors like whether you're starting alone or with partners, what industry you're entering, and how much money you can afford to invest in the business.

Pär:
Okay. So, let’s focus on sole traders and limited companies. What sets them apart, and how do you choose between them?

Ulf:
In a sole trader company you are the sole owner. But in a limited company, there can be several individuals owning the company. Sole traders don't require any initial capital, but limited companies must have a minimum share capital of 25,000 crowns. This is the capital you need to start and invest in the business if you go for the limited company option.

Pär:
So, any other differences between them?

Ulf:
Well, another key difference is about the responsibility for the company’s debts and contracts. In a sole trader company, you are personally liable for the business, meaning that you're responsible for the company's debts if its assets can't cover them, such as in bankruptcy.

Pär:
Can you explain a bit on that?

Ulf:
Well, as a sole trader, even if your personal and business identity numbers are the same, it's very important for you to keep your personal and business finances separated. If you run a limited company, then it is separate from you as the owner. This means that it is the company that, for example, signs agreements and takes out loans. So, if your company faces a debt that the company cannot pay, it is primarily the company that has to pay for it. Not you personally.

Pär:
I got it. Are there other differences worth noting between sole traders and limited companies?

Ulf:
Well, yes. As a sole trader you are pretty much on your own. You don't need a board of directors to run the sole trader company. However, if you start a limited company, then you must have a board consisting of at least two board members.

Pär:
Any other factors to consider when selecting a business structure?

Ulf:
Well, the taxation differs between sole traders and limited companies. And that’s something to bear in mind. You can find more information about this on our website, skatteverket.se.

Pär:
So, if you have made your choice. What's the next step?

Ulf:
The next step is to register your company. And you can do that easily on verksamt.se.

Pär:
Verksamt.se. What is that?

Ulf:
Verksamt.se is an excellent resource, and a lot of the information is in English. It combines information, tools, and e-services from various government agencies. It's really a one-stop shop for individuals starting or managing a business. You can find guides on writing a business plan and a budget, among other helpful resources.

Pär:
Is this where you register your company?

Ulf:
Yes, exactly. The easiest way to register a company is on verksamt.se. You log in to the website with your e-identification. If you don’t have the possibility to do it online, you can still use a form on the Skatteverket website. The form is called ”Företagsregistrering”.

Pär:
Okay. What else can you do on verksamt.se?

Ulf:
Well, among other things, there is a checklist with things you need to think about and do in connection with your business start-up.

Pär:
Right. Ulf, let's talk about taxes as well. Can you help our listeners understand the differences between F-, FA-, and A-tax?

Ulf:
I can try, at least. The different types of taxes show who has to pay taxes and social security contributions. When you're employed, you have what's known as A-tax. In this case, your employer takes care of tax deductions and contributes to the social security payments directly to Skatteverket. This is probably the most stress-free solution. Then we have the F-tax, where the “F” stands for ”företag”, meaning company. It means that you must pay taxes and fees for your business yourself. When it comes to limited companies, only the company itself can receive F-tax. To apply for F-tax, you go through Skatteverket and there are very specific requirements for approval, which you can find detailed information about on our website. When you work in your limited company, you become an employee and you pay A-tax. If you have a regular job and run your own business as a sole trader on the side, then you'll be dealing with FA-tax, where “F” is for your company and “A” is for your employment.

Pär:
Ulf, one more important thing I wanted to ask, is it possible to have foreign partners in your company? Partners who neither live in Sweden nor have any direct ties to the country?

Ulf:
Oh, absolutely. Foreigners can operate businesses in Sweden. However, in this case, there are a lot of things to think about to make sure taxes and other things are handled correctly.

Ziza:
Thanks, Ulf, for sharing these insights with our audience today.

Ulf:
You’re welcome. It was my pleasure.

Ziza:
Do you have any last tips to add?

Ulf:
Yeah, I would like to add one more thing. If you want more information about starting a business in Sweden, we actually have special webinars on skatteverket.se in English, for your help. So, just go in there and participate.

[music]

Ziza:
Thank you, Ulf. And that wraps up our discussion for this segment. There are still a lot of things to talk about in this field, including aspects like business names and how to safeguard your enterprise through insurance and patents. If you want to learn more, head over to verksamt.se. We also have links available on arbetsformedlingen.se/play, under this episode. A big thank you to Ulf Nilsson, for sharing his knowledge with us today. Join us in our next episode, where we will dive into what you need to consider when running a business. Until then, take care.

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speaker:
You have been listening to the New in Sweden podcast by Arbetsförmedlingen. You can find all previous episodes at arbetsformedlingen.se/play. Have you got any questions, tips, or ideas? Please email us at podcast@arbetsformedlingen.se. This episode was produced in the autumn of 2023.

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