Sweden’s income tax rates are among the highest in Europe, but its deduction system is more generous than many newcomers realise. Foreign employees and business owners moving to Sweden often either miss deductions they are entitled to, or wrongly assume a deduction from their home country works the same way here. This guide covers the deductions most relevant to foreigners living or working in Sweden in 2026.
ROT and RUT: Sweden’s Best-Known Tax Deductions
ROT and RUT are tax reductions applied directly at the point of payment, rather than claimed later on a tax return, which makes them easy to use even for someone unfamiliar with the Swedish tax system.
- RUT deduction – 50% off the labour cost of household services such as cleaning, gardening, snow removal, and childcare in the home, when performed by a company registered for F-tax (F-skatt)
- ROT deduction – 30% off the labour cost of home renovation, repair, and maintenance work on a home you own
Combined, ROT and RUT deductions are capped at SEK 50,000 per person per year, according to Skatteverket, the Swedish Tax Agency. Only labour costs qualify; materials and equipment do not. Because this cap and the eligible categories of work are reviewed periodically, it’s worth confirming the current figures with Skatteverket before relying on them for a specific project.
Interest Deductions: A Real Change to Know About in 2026
Interest paid on loans, including a Swedish mortgage, is only partly deductible, and the rules have tightened for 2026.
- 30% of interest costs up to SEK 100,000 per year is deductible
- 21% is deductible on the portion above SEK 100,000
A notable change from 2026: interest on unsecured loans, such as personal loans and credit card debt, is no longer deductible at all, whereas it previously followed the same rates as secured loans. This mainly affects consumer credit rather than mortgages, but is worth knowing if you are used to broader interest relief from another country.
Commuting Cost Deductions
Travel between home and work can be partly deducted, but only the portion of annual costs above SEK 11,000 is deductible, and only the cheapest reasonable means of transport is normally counted. A deduction for using a private car instead of public transport is only available where it saves significant time or where public transport is not a realistic option.
The Expert Tax Relief Scheme for Foreign Specialists
This is arguably the most valuable deduction many foreign employees never apply for. Under Sweden’s expert tax relief (expertskatt), a qualifying foreign employee can have 25% of their employment income exempted from Swedish tax and social security contributions altogether.
- Applies to experts, researchers, and key employees, or anyone earning above a set monthly salary threshold (SEK 88,201 per month in 2026)
- You must be a non-Swedish citizen with no Swedish residence or work history in the preceding five years
- Relief lasts up to seven years for people who relocated to Sweden after 31 March 2023
- The application must be submitted within three months of starting work in Sweden
Applications are handled by the Taxation of Research Workers Board (Forskarskattenämnden), and missing the three-month deadline means losing the relief entirely, so this is one to act on early rather than during tax season.
A Practical Note for Foreign Business Owners
If you employ staff in Sweden or are considering relocating key people here, the expert tax scheme can be a meaningful factor in structuring compensation and relocation timing. It is also worth reviewing with new hires early, since the tight application window is easy to miss when someone is focused on settling in rather than paperwork.
Get Your Swedish Tax Deductions Right With Leinonen
Sweden’s deduction rules are generous in places, but the details and deadlines matter, particularly for foreign employees and business owners unfamiliar with the system. Leinonen Sweden’s accounting and tax specialists can help you and your team make the most of the deductions available. Contact Leinonen Sweden to review your situation.
