Transfer pricing in Sweden

Transfer pricing in Sweden at a glance

Regulation Type OECD
Are there specific transfer pricing regulations? Yes
Submission deadline N/A
Submission deadline upon request 30 days
Annual update required No
Official language requirements Swedish, Danish, Norwegian and English
Potential impact of penalties N/A

 

Swedish tax law

Rules for transfer pricing in Sweden are based upon:

  • Income Tax Act sections 14:19-20
  • Tax Procedures Act 39:15-16
  • Advanced Pricing Agreement Act

OECD

Sweden follows the OECD Transfer Pricing Guidelines.

Methods

Accepted methods

Accepted methods are:

  • the comparable uncontrolled price method
  • the resale price method
  • the cost plus method
  • the profit split method
  • the transactional net margin method

Priority of methods

Rules for transfer pricing in Sweden suggest the most appropriate method should be used. In any case are the traditional methods preferred over the transactional methods.

Documentation requirements

Information that should be included in the documentation:

  • A description of the company, organization and business operations
  • Information regarding the characteristics and scope of the transactions
  • A functional analysis
  • A description of the chosen pricing method
  • A comparability analysis

Language

  • Swedish
  • Norwegian
  • Danish
  • English

Requirements to prepare documentation annually

Rules for transfer pricing in Sweden do not provide an obligation to prepare transfer pricing documentation annually.

Submission deadline upon request by tax authorities

Upon a request of the tax authorities, a taxpayer a taxpayer has 30 days to submit the documentation.

Advance Pricing Agreements

General

Since 2010 it is possible to obtain bilateral or multilateral Advance Pricing Agreement (APA) in Sweden.

Terms

The term for which an APA is agreed upon is generally three to five years.

Penalties

Rules for transfer pricing in Sweden do not provide for specific transfer pricing penalties, meaning that ordinary penalties apply.

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