Benefits for your employees
You can choose to provide your employees with various benefits. Benefits are any form of compensation for work that you can give an employee other than cash. In principle, a benefit arises whenever you as an employer pay for an employee's private living expenses.
The general rule is that a benefit is taxable unless it is specifically stated that it is tax-free. If the benefit is taxable, you as an employer must pay employer's contributions on the value of the benefit and make tax deductions for the employee in the same way as when you pay a salary. Inform your employees in the employment contract of the conditions for how and when the benefits are to be paid and when they do or do not apply.
Common benefits include
- private use of company car
- access to a parking space
- free or subsidised meals
- free or subsidised exercise and wellness care
- healthcare
- occupational health services
- cleaning assistance
Private use of company car
When your employee uses a company car for private use, it counts as a taxable benefit, which you as the employer pay. This also applies to fuel costs for driving. If the employee uses a company car to a small extent, referred to as “minor use”, it is not a taxable benefit. Minor use means that the car is used on no more than ten occasions per year and that the total distance driven is no more than 1,000 km. Trips made by your employee to and from work are normally counted as private trips.
Car benefit at the Swedish Tax Agency (in Swedish)
Fuel benefit at the Swedish Tax Agency (in Swedish)
Exercise and wellness care
You can choose to provide your employees with opportunities for wellness care. If it is of minor value and aimed at the entire workforce, the wellness care is tax-free and, as an employer, you do not have to pay employer's contributions and make tax deductions.
As an employer, you can give your employees opportunities for simpler forms of exercise and wellness care at the workplace. This also applies to other simple wellness care activities that do not involve exercise, but are, for example, relaxing or rejuvenating. If the employee incurs a cost for e.g. gym membership, riding lessons or some other exercise, the employer can pay a wellness care allowance of up to SEK 5,000 per year against a receipt. This is a total amount that applies to the employee's expenses for both exercise and other wellness care.
Instead of a wellness care allowance, the employer can pay for the cost of e.g. a gym membership. In such cases, assessment of whether the activity is a tax-free employee welfare benefit must be based on whether the activity is of a simpler nature and of minor value. There is no defined amount for what is considered minor value but, a normal annual gym membership, for example, falls within the definition.
In some cases, a wellness care benefit may consist of only a single treatment or activity. For the measure or activity to be considered of minor value, the cost should not normally exceed SEK 1,000 per occasion. The total cost per year of a single treatment or activity should not exceed an amount considered to be of minor value. You must also offer the same benefit to all employees for it to be tax-free.
It is also up to you as an employer to decide which activities, within the limits of legislation and practice, you wish to authorise. An employee can never demand that an employer approve a particular activity.
More about employee welfare benefits and wellness care at the Swedish Tax Agency (in Swedish)
Healthcare
Free healthcare is normally a benefit subject to taxation and employer's contribution.
Healthcare that is provided by the employer but does not relate to rehabilitation, occupational health services or preventive treatment is a taxable benefit. Taxable healthcare includes ordinary medical examinations, general health check-ups, dental care, tests, X-rays, operations, etc.