The right benefits can make a big difference for both your company and your employees

We spoke with Helena Jangel Stridh from the Swedish Tax Agency about the most common employee benefits, the most frequent mistakes, and why occupational pensions deserve greater attention.

– As competition for talent intensifies, offering an attractive salary alone is not always enough. Employee benefits have long been a way for employers to both attract new talent and retain existing staff.

Some benefits have become almost standard in Swedish workplaces. Others receive less attention, even though they can be extremely valuable to those who receive them.

– The most popular benefits are those related to wellness and occupational health services, such as gym memberships, massage, foot care, and nutritional counselling, says Helena Jangel Stridh, Business development specialist at the Swedish Tax Agency.

One reason for their popularity is that they are easy to understand and provide immediate value to employees. In simple terms, wellness benefits are tax-free if they are of minor value and available to all employees. In that case, employers do not have to pay employer contributions or withhold tax on the benefit.

The most important benefit in the long term

Another benefit that is sometimes overlooked is the occupational pension. It is easy to focus on benefits that provide immediate value. Retirement may seem far away, especially for someone who has only recently entered the workforce. However, Helena believes it deserves much more attention.

– Occupational pension is perhaps the single most important benefit an employee can receive. When you’re young, retirement often feels like a problem for the future, but it’s something you should think about from the very beginning.

As an employer, it can therefore be wise not only to offer benefits but also to explain their value. What may not be fully appreciated today could prove to be one of the most significant aspects of employment in the long run.

Benefits are not always about tax

When discussing employee benefits, it is easy to focus on those with specific tax implications. However, many of the most appreciated benefits are more closely linked to how work is organized.

– Benefits that are not tax-related but are highly valued include the opportunity to work remotely, flexible working hours, and additional vacation days,” says Helena.

Various insurance solutions, such as health insurance, are also examples of benefits that many employees actively seek.

Of course, the most suitable benefits vary between workplaces and individuals. What appeals to a parent of young children may not be the same as what attracts a newly graduated employee or someone approaching retirement.

The benefit that often causes problems

One of the most common benefits in working life is a company car benefit. At the same time, it is also one of the areas where mistakes frequently occur.

– Yes, a common mistake with company car benefits is that additional equipment is not included in the calculation, says Helena.

Common examples of additional equipment include winter tires, tow bars, climate control systems, and alarm systems. These are features many people have in their cars but may not think of as extras.

– If the employer fails to include this type of additional equipment in the calculation, the taxable benefit value will be too low, which can result in incorrect taxation for both the employer and the employee.

Company car benefits are therefore a good example of why it is worth understanding the rules before introducing a new benefit for your employees, so that everything is handled correctly from the outset.

– Most benefits are relatively straightforward, but some require a little extra attention, concludes Helena.

The type of company matters

For employees, it generally makes no difference whether the employer operates as a limited company, sole proprietorship, or another type of company entity. The rules that apply to employees are fundamentally the same.

For company owners themselves, however, the situation can be different.

– If you operate as a sole trader or a general partnership, you are not considered an employee of your own company. In that case, the same rules do not apply. For example, wellness benefits are not tax-deductible for sole proprietors,” says Helena.

It is therefore important to distinguish between your role as an employer and your role as a business owner. A benefit that can be offered to employees does not automatically provide the same tax advantages for the owner of the company.

A way to strengthen your employer brand

Employee benefits are rarely the only factor that determines someone’s choice of employer. However, they can make an offer more attractive and provide greater security for employees over time.

For business owners, this means it is important not only to keep track of which benefits are currently popular, but also to understand the needs they address and who they are most attractive to. In some cases, gym memberships and massage treatments are what appeal most. In others, it may be the security provided by insurance coverage or the financial stability offered by an occupational pension.

When thoughtfully designed, employee benefits can become an investment that benefits both the company and the people who work there.

Benefits for your employees