Am I allowed to start my own business in Sweden?
Yes — starting a business in Sweden is straightforward. A sole trader needs no start capital; you apply for F-tax with the Tax Agency via verksamt.se and register for VAT and, if relevant, as an employer. You are personally liable for the business's debts — that is the big difference from a limited company, which is its own legal person. You can be VAT-exempt if turnover is at most 120,000 kr per year (raised from 80,000 kr on 1 January 2025), but the trap is that you must register anyway — and that you then cannot deduct input VAT. If you instead want a limited company, 25,000 kr of share capital is required plus registration with the Companies Registration Office. Standard VAT is 25%.
📋 The rules
- Sole trader: no start capital, apply for F-tax
- VAT exemption with turnover ≤ 120,000 kr/year
- A limited company needs 25,000 kr of share capital
- Standard VAT 25% (also 12% and 6%)
- F-tax: you pay your own preliminary tax and social charges
🔓 Exceptions
- Some trades need permits (food, alcohol, taxi)
- Even VAT-exempt you must register and then cannot deduct input VAT
- Foreign founders need a personal or coordination number
⚠️ Penalties & fines
Running a VAT-liable business unregistered, or invoicing without valid F-tax, can bring a tax surcharge and back tax — money you have usually already paid out to yourself. Serious cases can be treated as accounting or tax offences. But the cost most people miss is not criminal: in a sole trader you are personally liable for the business's debts, so an unpaid supplier invoice lands straight in your private finances. In a limited company the debt stays in the company — but that needs 25,000 kr of share capital.
📎 Official sources
- Verksamt.se · Start a business →
- Tax Agency · VAT exemption →
- Companies Registration Office · Compare forms →
❓ Frequently asked
Do I need start capital to start a business?
No, a sole trader needs no start capital at all — you can register it and apply for F-tax without a krona in the account. A limited company, however, needs 25,000 kr of share capital and registration with the Companies Registration Office.
When must I register for VAT?
You can be VAT-exempt if turnover is at most 120,000 kr per year, a threshold raised from 80,000 kr on 1 January 2025. Even VAT-exempt you must register, and you then cannot deduct the input VAT on your purchases.
What is F-tax?
F-tax is an approval from the Tax Agency meaning you pay your own preliminary tax and social charges as a business owner. Invoicing without valid F-tax can bring a tax surcharge and back tax, so the approval should be in place before you start.
What is the difference between a sole trader and a limited company?
In a sole trader you are personally liable for the business's debts, and it needs no start capital. A limited company is its own legal person with its own capital, but it requires 25,000 kr of share capital and registration with the Companies Registration Office.
Where do I register the business?
A sole trader and F-tax are registered with the Tax Agency via verksamt.se, while a limited company is registered with the Companies Registration Office. Some trades, such as food, alcohol and taxi, also need a specific permit before you may start.
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