Permian | Taxation of board fees in Sweden- new practice
post-template-default,single,single-post,postid-3994,single-format-standard,ajax_fade,page_not_loaded,,select-theme-ver-1.3,wpb-js-composer js-comp-ver-6.0.2,vc_responsive

Taxation of board fees in Sweden- new practice

The Swedish Supreme Administrative Court (sw. Högsta Förvaltningsdomstolen) recently decided that board fees shall be taxed as salary income. The verdict contradicts the Swedish Tax Agency’s former view and could have significant impact for Swedish board professionals.

The Swedish Tax Agency has practised that board members could charge their fees from a separate legal entity, if the board member holds a minimum of three board positions and each board assignment is performed in a company not directly or indirectly owned by the board member or any of its related parties. Consequently, taxes on board fees in a number of cases have been levied upon privately held companies rather than on the board member as a person.

The Court disagrees and has recently stated that board fees should only be charged to such privately held companies if the board assignment is temporary and specially defined. Unless both criteria are met, board fees shall be paid and reported as salary.

As most Swedish board professionals have ordinary board assignments, i.e. not temporary nor specially defined, this new practise will have two major effects:

1. The tax burden of such board members will increase, and

2. The companies paying board fees for such ordinary board assignments will be liable for payroll tax.

It is evident that both companies paying, and board members receiving, board fees should assess their current handling of such fees.

Link to the Swedish Supreme Administrative Court’s verdict (Mål nr 278-17) here.

In case you have any question about the verdict, do not hesitate to contact Espen Iversen Størseth at

No Comments

Post a Comment