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Taxes when working from Sweden

patrikg123
Active Member
Patrik G Member Since: Sep 22, 2018
1 of 14

Hi all!

Can someone working as a translator from Sweden tell me how you pay your taxes?

I would like to get answers to the questions:

-What kind of company do you have?

- Do you use the invoices from Upwork or do you make your own?

-Do you pay VAT? I read somewhere that translators in Sweden working with a client in the EU don't have to pay VAT. Maybe it was just a dream Smiley Happy

- How do you book it? As detailed as possible.

Thanks for any help/Patrik

emeliel
Active Member
Emelie L Member Since: May 3, 2020
2 of 14

Hi Patrik!

 

did you figure this out? I am starting myself right now as a freelancer and would love to know how it works when you work from Sweden. 

 

How did you do it?

Have a great day!

Emelie

patrikg123
Active Member
Patrik G Member Since: Sep 22, 2018
3 of 14

I send my own invoice (through chat) in adition to the inoice the client gets from Upwork. This is only for tax reasons. If  your client is a company in the Eu with a VAT number you don't have to charge VAT. If the client is an ordinary person in the EU you do have to chare swedish VAT. I am not sure how it works with clients outside of the EU.

adcf48a8
Active Member
Rohit A Member Since: Oct 11, 2020
4 of 14
Do you have some input on this yet?
adcf48a8
Active Member
Rohit A Member Since: Oct 11, 2020
5 of 14
I am working with clients in the US. Skatteverket says that if I can prove they are corporate clients, then I don't need to add vat.

Why do you send your own invoice Patrick, is it because Upwork invoice doesn't have all the fields needed by Skatteverket?

Thanks in advance
sheik_mishuk
Active Member
Sheik A Member Since: Oct 7, 2019
6 of 14

Hi Rohit, I was following the thread. Thanks for your contribution. I have a question to you regarding the "Tax" issue. In your case, you need not to pay VAT, but how is the rule for Tax?
Would be very helpful if you please share.

adcf48a8
Active Member
Rohit A Member Since: Oct 11, 2020
BEST ANSWER
7 of 14

All right folks, here are some answers after filing for my 1st year of taxes. I have an enskild-firma.

 

Note: I am not an accountant or a legal person to advise on this matter. Please check all information on Skatterverket website. I am in no way responsible for your bookkeeping/accounting if you do your bookkeeping/accounting or not, how you do your bookkeeping/accounting or when you do your bookkeeping/accounting.

 

1. I generate my own invoice for all clients- Swedish, EU, or non-EU. I add the words 'payable through Upwork on it'. Technically they have already put money in Upwork Escrow by then.

- I attach the invoice from Upwork with my invoice since it's easy for bookkeeping or personal tracking. Upwork invoice misses certain fields that Swedish regulations need. 

2. I ask the client for details such as:

- Business Name

- Organisation Number/ Identification Number- It's different for every country but they do have one. This one pertains to-you should be able to prove that it's a business that you are working within the EU or outside the EU. In such cases, the reverse charge for VAT applies if you can prove they are a business.

Upwork invoice often has the name and company name and VAT number(if in EU), otherwise, I just ask for it!

3. I avoid working with individuals since you will have to pay the VAT from the amount you get. So if you charge $75 for an hour. It's effectively $60 + 25% VAT. Remember the Upwork commission is a fee, so you will pay that from the $60, and that fee is also on the VAT. So effectively, if the commission is 10%, you earn 52.5$!

4. Working with a business in Sweden is similar to point 3 above. For them, I add the VAT on the rate we decide and send them an invoice with VAT, so they can claim it back. It's actually a grey zone and I have failed to get the proper information from accountants or Skatterverket on this.

How I do it now:

Hourly rate $100/ hour

If Swedish clients, inform them of the extra VAT.

Net $125/ hour.

Generate invoice and send to the client with charge $100, VAT $25.

Expense for Upwork Comission(considering 10%) : $12.5

You earn a net of $87.5 and you pay VAT of $25.

 

If you are thinking about why 3 and 4 are different:

- Swedish clients can claim the VAT back and they are used to having that added above any services/ goods and don't fuss about it. They don't see the VAT as an expense. Individuals couldn't care less because they cant claim it back and it's an expense for them.

- I don't have time and patience to explain VAT to non-EU clients and will just pass on them if they don't have a business or are going to register one, but haven't yet. I did work for 1 client and once I did the bookkeeping, I decided to never again.

5. I generate my invoice as soon as a payment moves to pending or starts showing in the transaction history because then I can download the Upwork invoice to attach to my invoice. The dates won't match since Upwork invoice will show the date it charges the customer as the payment date, but I consider the date of payment as the date it moves from Pending to my Upwork balance.

 

I can recommend you to read this blog: https://www.momsens.se/upwork-bokforing

 

I use the website Bokio for my bookkeeping and it translates to English pretty well. If you use Bokio and want to know how I use it, feel free to ask me. If you use another software or way, May the Force be with YOU.

 

 

 

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colettelewis
Community Guru
Nichola L Member Since: Mar 13, 2015
8 of 14

When I started out, I Googled freelancing in France and then went  to the tax authorities concerned. I did not rely on advice from my fellow freelancers unless they gave me links to the relevant department in France.  Is this not possible in Sweden? 

 

 

 

adcf48a8
Active Member
Rohit A Member Since: Oct 11, 2020
9 of 14
Skatt=tax
Verket=office

If you are trying to start a business in Sweden, and don't recognize that word in the beginning of my post, my post doesn't concern you.
colettelewis
Community Guru
Nichola L Member Since: Mar 13, 2015
10 of 14

Rohit A wrote:
Skatt=tax
Verket=office

If you are trying to start a business in Sweden, and don't recognize that word in the beginning of my post, my post doesn't concern you.

_______________________

Rohit, you are not the OP of this thread. Wherever you start a business, your first stop is your local tax office and it is for the person concerned to discover what is applicable to their case. 

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