A new year brings new or amended laws and regulations in payroll and HR that must be navigated. For those responsible for employees or for providing information to HR or payroll managers, there are important updates to be aware of.
It’s not only essential to understand these changes, but employers and managers must also evaluate how the updates will impact their internal policies, procedures, and decision-making processes.
Below is a summary of what is new and scheduled to take effect during the first half of 2025.
Regulations Effective from January 1, 2025
- New Reporting Requirements in the Employer Declaration - Employer declarations must now include information about employees' absences that may qualify for parental or temporary parental benefits. This change is intended to facilitate the Swedish Social Insurance Agency’s (Försäkringskassan) inspections.
- Expanded EU Blue Card Regulations - The salary threshold for the EU Blue Card will be lowered, and its scope expanded. This change means that more highly skilled non-EU citizens employed in Sweden will be eligible for this program.
- Increased Flexibility in Withdrawing Occupational Pensions - It will become possible to pause ongoing occupational pension payouts during the first five years and to extend the payment period during the initial payout years.
- Doubling of the Employer Grant for Rehabilitation Support - The maximum grant payable to employers for rehabilitation support per employee per year will increase from 10,000 SEK to 20,000 SEK.
- Expansion of the “Growth Support” (Växa-stödet) - Growth support, which reduces employer contributions, will now apply to up to two employees. Additionally, the maximum monthly salary eligible for the reduction will increase from 25,000 SEK to 35,000 SEK.
- New Agreement Between Sweden and Denmark on Cross-Border Work - A new agreement simplifies rules for cross-border work and provides greater flexibility for employees and employers. One key change is that the requirement for at least 50% of work to be performed in the primary work state will now be assessed over a 12-month period (previously three months). Public employees are now also included in the regulations, making compliance with tax and social security rules easier for cross-border work.
- Lower Threshold for Expert Tax Relief - The salary requirement for expert tax relief will be reduced from 2 times the price base amount to 1.5 times the price base amount, enabling more individuals to qualify.
- Enhancements to the General Tax Credit and Basic Deduction - The general tax credit and basic deduction will be improved, and the phase-out for higher income levels will be removed.
- Restrictions on Parental Benefits for Non-Work Days - To qualify for parental benefits at the basic or minimum level during non-work days, the parent must claim benefits at an equivalent or higher level directly before or after the non-work days. This applies only to periods of non-work lasting up to four days.
New Amounts and Benefits Effective January 1, 2025
- Price Base Amount: Increased by 1,500 SEK to 58,800 SEK. The elevated price base amount also rises by 1,500 SEK to 60,000 SEK, impacting taxes, car benefit calculations, meal benefits, study aid, occupational pensions, and parental and sickness benefits.
- Income Base Amount: Increased by 4,400 SEK to 80,600 SEK, affecting the income insured in the public pension system.
- Government Loan Interest Rate: Reduced by 0.66 percentage points to 1.96% as of November 30, 2024, impacting car benefit value and interest benefit calculations for 2025.
- Tax-Free Income for Youths: Increased by 635 SEK to 24,873 SEK annually for 2025.
- Meal Benefits: Slightly increased to 305 SEK /day (full board with three meals), 122 SEK /day for free lunch or dinner, and 61 SEK /day for free breakfast.
Other Changes to Benefits
- Housing Benefit: Free or subsidized housing remains a taxable benefit. Employers must use standard values for reporting these benefits. The 2025 standard monthly values per square meter are: 138 SEK for Greater Stockholm, 124 SEK for Greater Gothenburg, and 134 SEK for Greater Malmö.
- Per Diem Allowances: Adjustments have been made for increased living expenses abroad during business travel, temporary assignments, and dual residences, in line with the Swedish Tax Agency’s guidance.
- Bicycle Benefit: The value of this benefit will be recalculated based on the government loan interest rate as of November 30 of the prior year.
- Car Benefit: The car benefit value must be recalculated to reflect the updated price base amount.
Additional Changes in Early 2025
- From April 1, 2025, parental benefits will be restricted for parents who are simultaneously employed.
- Most collective agreements will be renegotiated, with new agreements taking effect as existing ones expire in spring 2025.
With numerous changes already implemented or expected this year, legislation, updated values, and new collective agreements often require adjustments to processes and systems.
As your payroll partner, we help you stay informed about these changes and ensure that our services are updated to reflect the latest regulations and requirements.
We at Azets are experts in payroll administration, HR, and accounting. Don’t hesitate to contact us if you need additional assistance or advice.
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