What is Aktiebolag (AB — Swedish Limited Company)?
An Aktiebolag (AB) is a Swedish limited company, the most common business structure for entrepreneurs and SMEs. Minimum share capital is SEK 25,000. The AB is registered with Bolagsverket and is a separate legal entity with limited shareholder liability. At least one director must be resident in the EEA.
Current Rate (Inkomstår 2025)
20.6% bolagsskatt on profits
Example
A freelance consultant incorporates an AB with SEK 25,000 share capital, registers on verksamt.se, and receives an organisationsnummer within 1-4 weeks. She takes a salary from the AB and distributes additional profits as dividend under the K10 rules.
How Aktiebolag (AB — Swedish Limited Company) works in Sweden
The Aktiebolag (AB) is Sweden's standard corporate vehicle, roughly equivalent to a UK Limited Company, a German GmbH, or a Dutch BV. It offers limited liability, clear tax planning opportunities (especially via the 3:12 rules), and is the preferred structure once a business generates meaningful profits.
**Formation requirements**
To form a private AB (privat aktiebolag), you need: - Minimum share capital of SEK 25,000 (fully paid up at formation) - A board of directors (styrelse) with at least one member and one deputy (suppleant), OR at least three members without deputies - At least one board member (and the MD if separate) must be resident in the EEA - Articles of association (bolagsordning) setting out company name, business purpose, share capital range, and number of shares - Registration with Bolagsverket and payment of the registration fee (approximately SEK 2,200 for e-registration, SEK 3,700 for paper)
Registration is done via verksamt.se (the government's business registration portal) or directly via Bolagsverket. Electronic registration typically takes 1-5 business days; paper can take several weeks.
**The organisationsnummer**
Upon registration, the AB receives a 10-digit organisationsnummer (format: XXXXXX-XXXX). This is used on all invoices, tax filings, and commercial documents.
**Annual compliance**
Once formed, an AB must: - File an annual report (årsredovisning) with Bolagsverket within 7 months of the financial year end (or 6 months for larger ABs) - Hold an annual general meeting (bolagsstämma) within 6 months of the year end to approve the accounts - File Inkomstdeklaration 2 with Skatteverket (corporate income tax return) - File momsdeklarationer and arbetsgivardeklarationer (if employing staff)
**Auditor requirement**
Small ABs (below two of three thresholds: 3 employees, SEK 1.5m balance sheet, SEK 3m net turnover) can dispense with a statutory auditor (revisor). Most single-founder consulting ABs qualify for the exemption, saving the approximately SEK 15,000-30,000 annual revisor cost.
**Why choose an AB over enskild firma?**
The AB becomes advantageous when annual profits consistently exceed approximately SEK 400,000-500,000. At that point, the combination of 20.6% bolagsskatt plus the preferential 20% tax rate on dividends within the K10 gränsbelopp produces a materially lower effective tax rate than the progressive personal income tax (up to 52%) on enskild firma profits.
**Public vs private AB**
The standard AB is a privat aktiebolag (private). A publikt aktiebolag (publ) can offer shares to the public and list on a stock exchange; it requires a minimum share capital of SEK 500,000 and additional governance requirements.
Related terms
Bolagsskatt is Swedish corporate income tax, charged at a flat rate of 20.6% on the taxable profits of Swedish limited companies (aktiebolag). There is no regional variation. The rate was reduced from 21.4% in 2021.
The K10 (for AB shareholders) and K12 (for partnership interests) are Swedish tax forms used to separate dividends and capital gains taxed at the flat 20% rate within the gränsbelopp (threshold) from income taxed at the higher 30% or employment income rate. The underlying rules are the 3:12 rules (fåmansföretagsreglerna), applying to closely held companies.
Arbetsgivaravgifter are Swedish employer social contributions, payable on top of gross salaries. The standard rate is 31.42% of gross salary in 2025. They cover pension, health insurance, parental leave, unemployment, and other social benefits. Reduced rates apply for workers under 26 and over 65.
Skatteverket is the Swedish Tax Agency, responsible for tax assessment, collection, population registration (folkbokföring), and identity numbers. All company and individual tax filings — including moms, arbetsgivardeklarationer, and income tax returns — are submitted via Skatteverket's e-tjänster (digital services).
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