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As the world evolves, so do laws and regulations. As an employer, it's crucial to stay informed about these changes to ensure compliance with current requirements. In this article, we remind you of the key legislative changes that took effect on July 1, 2024, as well as other relevant topics concerning payroll and HR.
Legislative Changes Effective from July 1, 2024
- The compensation for high sick pay costs has ceased since the end of June 2024. For nearly ten years, there has been support available for Swedish businesses that, in certain cases, could receive compensation for high sick pay costs. This compensation was handled automatically by the Swedish Social Insurance Agency (Försäkringskassan) based on information reported in the employer's declaration. For more information, read here:
Compensation for High Sick Pay Costs Phased Out
- The modernization of the Parental Leave Act means that parents can transfer parental leave days to other individuals, provided they are covered by the Swedish insurance system. Up to 45 days per child can be transferred to another person, and in the case of sole custody, up to 90 days. Individuals who receive days have the right to leave from their work under the same conditions as parents have had previously. The number of double days – i.e., days where both parents can take parental leave for the same child simultaneously – increases from 30 to 60, and these can be utilized until the child is 15 months old, compared to the previous 12 months. For more information, refer to our earlier article:
New Rules for Parental Leave
- The opportunity for digital archiving of accounting material. A long-awaited modernization of the Bookkeeping Act means, in short, that paper materials can be destroyed if they have been transferred to digital media in a secure manner and meet other applicable requirements. There must be no risk that the accounting information is altered or lost. Although the law comes into effect at the mid-year mark, it may be wise to await the guidance from the Swedish Accounting Standards Board (Bokföringsnämnden) regarding this law, which will be released in the fall. For more information on the topic, see our previous article: Paper Receipts a Thing of the Past - How to Digitize Your Physical Receipts
Other Relevant Topics Concerning Payroll and HR:
- The government has presented a comprehensive investigation into how the EU's Pay Transparency Directive will be implemented in Sweden. The directive is to be applied no later than June 2026. The investigation presents several legislative changes in the Discrimination Act, with pay surveys becoming the backbone of transparency regulations. Since there are already requirements for all companies to conduct pay surveys, it may be beneficial to review current practices to prepare for adjustments when the new law comes into effect.
- Last year, the Swedish Tax Agency (Skatteverket) issued a position statement regarding VAT requirements for certain salary deductions. In May, a ruling from the Supreme Administrative Court confirmed that when an employer provides employees with benefit bicycles in exchange for a portion of their gross salary, VAT applies. Generally, VAT should be calculated on the gross salary deduction. In cases where the gross deduction is reduced due to lower social security contributions, VAT should instead be calculated on the market value of the benefit. We explain in which situations VAT on salary deductions is relevant here: Position on Value Added Tax (VAT) on Wage Deductions
- Statistics Sweden (SCB) is an authority that imposes various reporting requirements on Swedish employers. There have also been several changes during 2024: in January, the Economic Statistics on Sick Pay (KSju) was replaced by the Sick Leave Statistics (SuS). The Short-term Employment Statistics data has also been replaced and will now be presented in a new statistic, Employment (ANST). This information is directly retrieved from the Employer's Declaration at Individual Level (AGI) via the Swedish Tax Agency and in the new Sick Leave Statistics (SuS).
Azets is Here to Help!
The reality for Swedish employers is complex and requires extensive expertise in payroll and HR. Many companies choose to outsource payroll administration to ensure that the company complies with applicable laws and regulations. With Azets as your payroll partner, you gain access to expert competencies and professional, often certified, payroll specialists who ensure that the applicable regulations are followed and advise you on issues within payroll and HR.
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