This information does not pertain to financial companies. Information about such companies is available on the website of the Swedish financial supervisory authority (Finansinspektionen ).
Requirement to maintain accounting records
A foreign company that conduct business activity in Sweden through a branch is required to maintain accounting records according to the Book-keeping Act (bokföringslagen).
A branch is required to maintain accounting records in Sweden for the operations conducted in Sweden. The branch shall have its own accounting records that are separate from those of the foreign company.
For the branch’s accounting records, the same applies as for an equivalent Swedish company. The branch shall therefore apply the Book-keeping Act (bokföringslagen) and generally accepted accounting principles. This means that
- all business transactions must be recorded on a current basis
- there must be supporting vouchers for all accounting entries
- accounting information must be archived in an orderly state and in a satisfactory and transparent manner in Sweden for seven years, and
- annual financial statements or, in certain cases, annual reports, shall be prepared for each financial year.
The Book-keeping Act (bokföringslagen), Swedish version
Because the same rules apply to a branch as to a Swedish company, the branch shall apply the rules regarding the current recording of transactions, supporting vouchers, archiving, etc. contained in the BFN guide Bokföring.
Bokföring, Swedish version
Accounting information, which the branch itself prepares, shall be in Swedish, Danish, Norwegian or English. The Swedish Tax Agency may decide on authorisation to use a different language.
The accounting currency of the branch shall be Swedish kronor. In foreign companies that are equivalent to a Swedish limited company or a Swedish economic association, the accounting currency of the branch may be euro.
Archiving and storage abroad
The BFN guide Bokföring contains rules regarding archiving and storage abroad.
The basis is that both documents and machine-readable media shall be stored in Sweden.
In certain conditions, supporting vouchers in paper form may be temporarily stored abroad if the document is needed for management, processing or book-keeping abroad or if the document is needed to be able to reclaim tax or needs to be presented as an original for other reasons.
Machine-readable media and machinery and systems may, in certain conditions, be stored in an EU country if this is reported to the Swedish Tax Agency. The same applies to a non-EU country if, in addition, there are legal instruments regarding mutual assistance. Terms for storage abroad are set out in Chapter 7, section 3a of the Book-keeping Act (bokföringslagen).
If storage abroad may not occur pursuant to Chapter 7, section 3a of the Book-keeping Act, the Swedish Tax Agency may, if special grounds exist, decide on authorisation to store machine-readable media and systems abroad. Such authorisation may carry terms and conditions and be time-limited.
Annual reports or annual financial statements
A branch shall, as a main rule, close its current recording of transactions in the same way that applies to an equivalent Swedish company. How the current recording of transactions is to be closed is set out in Chapter 6 of the Book-keeping Act (bokföringslagen). The current recording of transactions shall be closed either with an annual report (årsredovisning) or annual financial statements (årsbokslut).
Branches of companies in the EEA which are comparable to a limited company shall, each financial year, prepare annual financial statements. For the annual financial statements of the branch, the rules regarding annual financial statements of the Book-keeping Act apply.
Amounts in the annual financial statements shall be stated in Swedish kronor. The annual financial statements shall be written in Swedish, Danish, Norwegian or English. Instead of annual financial statements, the branch may prepare an annual report.
Branches of companies not in the EEA which are comparable to a limited company shall, each financial year, prepare an annual report. The annual report of the branch shall be prepared in accordance with the provisions of the Annual Accounts Act (årsredovisningslagen). Amounts in the annual report shall be stated in the presentation currency of the branch, and may also be stated in another currency. The annual report shall be written in Swedish.
When the annual financial statements or annual report are prepared, the standards of BFN on the area shall also be applied.
The website of the Swedish Companies Registration Office (Bolagsverket) provides more information about which accounting documents must be submitted to it.
For foreign companies that conduct business activity in Sweden, the Foreign Branch Offices Act (lagen om utländska filialer m.m. – filiallagen) applies.
The Foreign Branch Offices Act (Lagen om utländska filialer m.m.), Swedish version.
Links are provided below to websites where further information in English is provided regarding branches.