Read news from:
Austria
SHARE
COPY LINK

INTEREST RATE

Sweden keeps record negative interest rate

UPDATED: Sweden's central bank (the Riksbank) is keeping its key interest rate, the repo, at a record low of -0.35 percent.

Published: 3 September 2015 09:52 CEST
Updated: 3 September 2015 16:57 CEST
Sweden keeps record negative interest rate
Riksbank head Stefan Ingves. Photo: Bertil Ericson/TT
There had been speculation that the rate would be cut, but the bank ruled this out for the time being while indicating that it remained a consideration for the future.
 
However, it suggested that the rate could fall to -0.40 or 0.45 percent later in the autumn.
 
The Riksbank is hoping that its financial strategy will boost inflation in order to raise the price of everyday goods and services in Sweden which have been stagnant for two years. It is argued that this in turn will improve the country's economic prospects.
 
“Our assessment is that inflation will rise to two percent in the course of 2016. But at the same time, one must remember that this is happening in an uncertain world….Therefore we are very ready to do more if we feel we need to do so,” Riksbank head Stefan Ingves said at a press conference.
 
Ahead of nationwide union-led wage negotiations this autumn, the Riksbank also suggested that average salary rises of just over three percent were needed across Sweden in order for the country to reach its inflation target, a figure which is causing concern among some employers.
 
Carl Eckerdal, chief economist at Livsmedelsföretagen (the Swedish Food Federation), which has over 50,000 employees, accused the bank of making “questionable projections” about productivity and the global economy.
 
But Torbjörn Johansson, who is set to lead negotiations for The Swedish Trade Union Confederation said he had no objection to the Riksbank's financial assessment.
 
“It's normal. They're supposed to monitor inflation,” he told the TT news agency.
 

Swedish kronor. Photo: Bertil Ericsson/TT
 
 
The Riksbank first slashed interest rates below zero in February in a landmark decision. It continued to cut rates in subsequent months, with the -0.35 rate introduced in July.
 
Negative rates work differently to positive interest ones. Instead of borrowers paying interest to banks who lend them money and savers expecting to earn interest on their cash, banks have to pay to lend money or make an investment.
 
The basic idea behind negative rates is to stop organisations or people from making risky investments or transactions that could impact on the wider economy.
 
Thursday's decision to hold the repo at -0.35 is bad news for savers in Sweden who will continue to see no return on any nest eggs stashed in basic savings accounts. 
 
However, those wishing to borrow money to buy properties or shares will continue to benefit from the record low rates.
 
Sweden is also continuing with its version of quantitive easing, a bond buying programme, which in simple terms involves borrowing money to inject back into the economy. 
 
The krona strengthened against both the euro and the dollar after the rate announcement, while market rates rose slightly.
 
Against the euro, the krona rose by about five cents, while the rate against the dollar strengthened 3 to 4 cents.

For members

MONEY

What to do if you can’t meet Tuesday’s Swedish tax declaration deadline

The deadline to submit your income tax declaration in Sweden falls on Tuesday May 2nd. Here's what to do if you haven't managed to get it together in time.

Published: 2 May 2023 11:38 CEST
What to do if you can't meet Tuesday's Swedish tax declaration deadline

When exactly is the Swedish tax deadline and what help can I have to meet it? 

The deadline falls on the stroke of midnight on Tuesday May 2nd, so you still have a few hours to get your declaration together.

Sweden may have relatively high taxes, but the Swedish Tax Agency seeks to make paying them as easy as possible.

If you have any questions, it is well worth ringing the helpline on 0771-567 567.

Unlike the helplines of the tax offices in most other countries, the helpline is well-staffed with informed people who go out of their way to help you. 

The agency also has a good quide in English on how to file your return. 

What happens if you miss the deadline? 

If you fail to submit your declaration by midnight, you are at risk of having to pay a fee of 1,250 kronor, but this won’t necessarily happen. There is an element of discretion, and if you filed your return at 0.15am on May 3rd, you may well be let off. 

In any case, before the charge is taken out of your tax account or skattekonto, you will first receive a note informing you of possible impending late charge, which you can then appeal. 

So if you fell ill on May 2nd, or the internet broke down at your apartment at 11.55pm, you can inform them when you receive this note and you may be able to avoid a fine.  

If in a further three months (August 2nd), you still haven’t submitted your tax declaration, you risk a second 1,250 kronor fine. Finally, after five months (October 2nd), you risk a third fine of 1,250 kronor. 

How to get an extension if you are self-employed 

You can extend the deadline until May 16th by logging into your page on the Tax Agency’s website or calling them on 0771 567 567 (or +46 8 564 851 60 from outside Sweden).

To find the extension form, go to the Mina Sidor page on your Tax Agency account, press the Skatter och Deklarationer link near the bottom, and then press the Anstånd med inkomstdeklarationen link and filling in the form. 

Jan Janowski, a declaration coordinator at the agency, said that the agency prefers for people to do this than to knowingly submit an incomplete or inaccurate declaration. 

“We want people to live their declaration in as complete a form as possible, but if you are still waiting for some supporting documents we would like people to apply for an extension.” 

If you have an accountant, they can apply for all of their clients’ income declarations to be delayed until June 15th in a measure called byråanstånd, intended to help them with the last minute rush to declare.

This, however, has to be done for all of their clients and isn’t something they can do for you just because you are late. 

Is it better to file an incomplete declaration than a late one? 

If you feel unable to file your declaration even on May 16th, what’s holding you back is likely to be something like declaring capital gains tax on share or property sales, or confusion over calculating one of Sweden’s many tax deductions, such as the ROT or RUT deductions for cleaning or home maintenance. 

If you are employed, the most important element of your tax declaration – your income from your job – will already be filled in on the paper or online form.

Declaring your main income from employment is just a question of checking that the details Skatteverket already has are correct and submitting a declaration either using Skatteverket’s app, or by sending a text message including your personal identity number and signature code to 71144 from within Sweden, or by calling 020 567 100 and following the instructions. 

If you are still wading through spreadsheets of share sales, but have no issues with the Tax Agency’s record of your income from employment, you can make the declaration but inform the agency that you may have other capital gains or other income to declare later on. 

If you do this, it’s good to be as transparent as possible with the agency about what information you are waiting for when you make your declaration.

To do this, find the andra information, or “other information” section in the declaration, and write down, in either English or Swedish, what information you are waiting for. 

You could write, for instance: “I sold an apartment in Florida in 2022 but have yet to receive details of the proceeds and am waiting for my accountants in the US to calculate the capital gains.” 

If you do this, you are much less likely to be fined if the Tax Agency later discovers any undeclared gains. 

How long do you have to make changes to your tax declaration? 

Until the Tax Agency makes a tax decision, normally in June, you can resubmit your tax declaration using the same form on the website you used to declare it the first time, and the agency will use the most up-to-date declaration when calculating your taxes. 

Even after it has made a tax decision for an income year, the agency is liberal about any voluntary changes made in future. 

Once a declaration has been made, you can still request changes to the final tax decision based on new information or corrections you have made for up to five years. 

For the first 12 months after the end of the taxation year (IE, until January 2024), the tax agency will never levy a so-called tax surcharge (skattetilläg), even if one of its officers discovers that someone has failed to declare, or falsely declared, some earnings or income in your return. 

After the first 12 months, if you bring undeclared income or falsely claimed tax breaks voluntarily to the tax agency’s attention before the agency discovers it, you are also likely to avoid a surcharge. 

What happens if the agency catches you not declaring income or falsely claiming rebates? 

If you are caught evading taxes or make a mistake, the penalty is set quite high. You have to pay the tax you should have paid, plus a 40 percent surcharge. 

SHOW COMMENTS