Succession of generations of a sole trader
Carrying out a generational change and letting the next generation take over means that the business is handed over by gift, inheritance or will. It is called a beneficial transfer.
Important points for a succession of generations of a sole trader
1. Prepare for the generational change
It is always good to tell the children about your plans well in advance. Then everyone will have a chance to get involved in the business before decisions are made. Everyone also gets a chance to have their say and this can reduce the risks of future conflicts.
A good idea is to let the next generation get to know the different parts of the family business before the transfer. Just as with the purchase of a company, it is good if the person taking over does their analysis of the company and also their own valuation.
If you, as an owner, want assets to be distributed according to performance and participation in the business, it may be a good idea to be prepared. According to inheritance law, all children are entitled to an equal share of the business. Therefore, it can be good to carry out a generational change in connection with, for example, retirement instead of waiting and letting it become a matter for the estate.
2. Transfer by gift
The transfer is a gift if
- you give away your business without getting anything in return
- there is a gift intention
- the submission is voluntary
- the gift has been delivered
The recipient can sometimes leave a certain compensation, for example by taking over existing loans in connection with the gift. If the compensation is less than the market value, the transfer is normally still a gift.
Deregister your sole proprietorship
When you have transferred your business, you must deregister F-tax, VAT and as employer with the Swedish Tax Agency. The recipient of the business may instead have to register for F tax, VAT and as an employer with the Swedish Tax Agency. Note that this service is only available in Swedish.
Change debited preliminary tax
In connection with the transfer, you may need to change the charged preliminary tax.
Preliminary income declaration 1 for natural persons (SKV 4314) at the Tax Agency
Report that the business and company name are to be taken over
If you have protected your business name and are registered as a sole trader with the Swedish Companies Registration Office, you and the recipient of the business must notify that the business and the business name are to be taken over. The recipient then needs to protect the company name at the Swedish Companies Registration Office by registering it before you deregister the company, so that the recipient can keep the name protection. The Swedish Companies Registration Office sends a registration certificate when the company is registered. Note that this service is only available in Swedish.
You must notify the Swedish Companies Registration Office that you want to deregister the company. The Swedish Companies Registration Office sends a registration certificate when the company is deregistered.
3. Transfer by inheritance and will
If a sole trader dies, the company's assets and liabilities pass to the estate. It is now the estate owners who are responsible for them. The estate owners are also responsible for reporting and paying taxes and fees.
The estate is transferred when the parties have divided the assets among themselves. If there is only one co-owner of the deceased's estate, the estate is transferred when the Tax Agency has registered the estate inventory.
Probate - good to think about with the Swedish Tax Agency (in Swedish)
Efterlevandeguiden, for those of you who have lost someone close
If the estate has not been transferred on January 1 of the year following the death, the co-owners must register the estate for F-tax, VAT and as an employer with the Swedish Tax Agency. All estate owners need to sign the notification. The Swedish Tax Agency will register a so-called estate number where the co-owners must continue to report and pay taxes and fees for the business until the estate is transferred.
Business registration (SKV 4620) (Tax and fee notification) with the Swedish Tax Agency (in Swedish)