Expat Investing In Sweden

For an expat living in Sweden, investing can be a daunting prospect given the tax laws and lack of information available.

This article aims to simplify how expats in Sweden can approach investing.

Expat Investment Advice

Whilst receiving expat investment advice does not guarantee a positive outcome, it will allow you to discuss and confirm your position and objectives.

Factors such as whether you're retiring in Sweden, there for a set period, or undecided can be discussed. If it is a set period, such as 5 years, where might you go next?

Other questions to consider can include:

Do you have other assets that need assessment and management?

Are you wanting to save for a property purchase, children's education, or a combination?

Is the focus solely on retirement planning and estate planning?

With various solutions available, it's important to determine your position and objectives at the start of the process.

Whilst these can and will change over time, it allows an overall investment strategy to be implemented at the offset.

Tax Efficient Investing Strategies

After determining your objectives, two main types of tax-efficient investment options are available to you. Important to note that this is for cash held outside of a retirement fund such as a UK pension scheme or traditional IRA.

Swedish 'K' Endowment Policy

This is a whole-of-life, single-premium investment Bond. In simple terms, a life insurance investment product specifically created for Swedish tax residents. The policy has a tax treatment stated as 'Taxable Taxable Exempt' (TTE).

This means rather than a pension where you will receive tax relief on your contributions, the investments grow tax-free and then income tax is paid upon withdrawal. With TTE, you don't receive tax relief or a reduction at the start, instead, tax is applied annually. As a result, all withdrawals from the policy do not incur income or capital gain tax.

Essentially, you pay a tax every year which is based on the initial investment value, any additional contributions, growth achieved, and the Swedish Government loan rate.

You then receive 100% of the amount you withdraw with no further tax due.

Swedish 'K' Endowment policies are available from numerous local sources however, with a specific expat provider, it allows you;

Multicurrency Options

Depending on how the investment is being funded, mitigate exchange rate risk by investing in SEK, USD, GBP, Euro or any major currency.

Portability

The ability to switch to an alternative tax-efficient solution upon relocating to countries such as UK, Portugal or France.

Wider Investment Options

Gain access to an extensive fund range in multi currency.

Language and Documentation

All documentation is available in English and Swedish ensuring you fully understand the rules and regulations of the product.

There are further tax benefits relating to gift and inheritance tax, assignment of the policy, and in the event of death.

Offshore Investment Account

An investment platform that is based outside of Sweden. For those with more transient lifestyles or intending to relocate to a location without a locally compliant investment solution.

For an offshore investment platform, the tax can be deferred so as long as it stays invested and no dividends are recieved. Upon disinvesting capital gains tax of 30% can be applied.

As with a K Endowment Policy, offshore investment accounts offer multicurrency, extensive fund ranges, portability and all documentation in English.

Please note we are not tax advisers and always recommend taking tax advice specific to your needs.

Expat Financial Planning

The Wealth Genesis are specialist expat financial planners. We help expats in Sweden utlise the best investment product, including tax-advantaged accounts. We provide bespoke investment portfolios' that cater to all needs, whether that's long-term capital gains, income generation or a reduction of future tax liabilities.

Contact us using the diary below to speak with a qualified independent financial adviser today.

FAQs

We charge an initial flat fee of £3000 and an ongoing management fee of 0.85%. Further information on our fees can be found here.
The investment return is based on the level of risk you are prepared to take, including the time horizon for the investment as well as the fund allocation. In general, high-risk returns can achieve +10% per annum, medium 6-7%, and low 2-4%. This is not guaranteed and will depend on the investments held and market performance.
No, this is not a savings account and your money will be susceptible to investment risk. For a savings account, we recommend speaking to your local bank.
Yes, you can invest in mutual funds, listed shares, Discretionary Fund Managers, and Government Bonds.