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In a recent memorandum dated May 19, 2025, the government has announced a proposal to lower the special income tax rate for non-residents, known as SINK, from 25 percent to 20 percent. The legislative change is proposed to take effect on January 1, 2026, and will apply to income received after December 31, 2025.

The special income tax for non-residents (SINK), as outlined in the law (1991:586), aims to simplify the taxation process for individuals residing abroad who earn taxable income from Sweden, such as salaries, pensions, and other earnings. The simplification allows these incomes to be taxed without the need to file a tax return. Instead, individuals apply in advance to have SINK tax applied to their earnings.

Swedish tax law differentiates between unlimited tax liability, which mean that an individual pay tax in Sweden on their global income, and limited tax liability, which means that an individual only pay tax in Sweden on certain Swedish-sourced income. Non-residents falling under the latter category can apply for SINK taxation. This tax is final, with no deductions allowed for expenses.

The current 25 percent tax rate has remained unchanged for several years, despite reductions in other income tax rates, necessitating an adjustment to maintain tax neutrality.

The proposed reduction to a 20 percent tax rate offers direct tax relief for non-residents currently taxed under SINK. According to the Swedish Tax Agency, this change will impact approximately 90,000 individuals, providing an average annual tax reduction of around 7,700 kronor.

The Ministry of Finance estimates that this tax cut would result in a decrease in tax revenues by about 700 million kronor annually.

ÀÖÓ㣨Leyu£©ÌåÓý¹ÙÍø will continue to monitor these developments closely and keep our clients informed about any changes and their potential impact.

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The article in Swedish