Sweden's New Dividend Rules for 2026: Impact on Corporations Outlined

Sweden has approved new 3:12 dividend taxation regulations, set to take effect in the 2026 fiscal year, affecting a majority of limited liability company owners. These regulations replace the current dual-system approach—comprising simplification and main rules—with a single, unified model for calculating tax-advantaged dividend allowance. Under the revised system, the standard base dividend allowance will increase substantially to four income base amounts (IBB), equating to SEK 322,400 for 2026. The existing salary requirement is eliminated; however, companies with employees can generate additional dividend allowance based on total salaries, contingent upon exceeding a standard deduction of eight IBB (SEK 644,800). Tax expert Anders Nilsson notes that while the changes aim for simplification, they may prevent some business owners from maximizing their dividend potential compared to the previous system. The elevated salary threshold could preclude many sole proprietors and co-owned businesses from generating any supplementary salary-based dividend allowance. In companies with multiple owners, both the base allowance and any salary-based allowance must be proportionally divided amongst shareholders, potentially restricting individual dividend amounts.