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bigduckontax, Accountant
Category: UK Tax
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I want to know if I can use my UK Ltd company in Sweden.

Customer Question

I want to know if I can use my UK Ltd company in Sweden. I'll be there for less than 183 days. I'll be there to do software engineering, however my company also offers Aerial Photography services in the UK. If I buy any Aerial Photography equipment, will this be allowed as expenses?
Submitted: 1 year ago.
Category: UK Tax
Expert:  bigduckontax replied 1 year ago.

Hello, I am Keith, one of the experts on Just Answer, and pleased to be able to help you with your question.

You personally will not be liable for Swedish taxation if you spend under 183 days in the country.

Using your UK company in Sweden can cause you problems [source Wikipedia]:

'A foreign company conducting business in Sweden, whether a natural or a legal person, may become taxable for VAT, employer´s contributions and/or income tax. The company should then apply for registration at the Swedish Tax Agency, and may apply for a Swedish F-tax certificate.

In the ‘Tax application for foreign entrepreneurs´ brochure and form, SKV 419 and SKV 4632 respectively, there is information on how to submit the application.'

The Swedish Tax Office gives full guidance here:

If, of course, the company is not conducting business in Sweden you do not have to worry about this. Sweden, as you may know, is one of the most highly taxed countries in the world. In comparison the UK is a tax haven!

As for the purchase of equipment for the aeriel photography business this is not allowable as expenses. It would go through the Capital Allowances regime as plant and machinery. At the moment it is effectively the same as the allowance on any purchase up to 500K is an Annual Investment Allowance at 100%. This window closes on 31 December 2015.

I do hope that my reply has shed some light on the situation.

Customer: replied 1 year ago.
As I'll be there less than 183 days, could I work through a UK company without registering it in Sweden, and just operate it as normal within the UK tax system?
Expert:  bigduckontax replied 1 year ago.
Probably; that is what I would recommend. After all what the eye does not see the heart does not grieve over! You would merely invoice from the UK to an EU customer. Watch out for the reverse charge on the VAT system. If you have the Swedish VAT number for your Swedish customer you effectively zero rate the sale by charging output and input tax simultaneously by means of a reverse charge. You will have to fill in an EU sales list in due course.
Customer: replied 1 year ago.
I'll only be invoicing a UK agency. Does that make things cleaner?
Expert:  bigduckontax replied 1 year ago.
Makes it much easier, very straighforward. The reverse charge system is, frankly, a pain in the behind to operate! In my opinion you definitely do not need to register your company in Sweden so that's another load off your shoulders.