Types of business

If you want to start a business in Sweden, you need to select a type of company. Sole trader, trading partnership/limited partnership, limited company and economic association are the most common types of company in Sweden.

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Different rules regarding taxes, charges and registration apply depending on the form of business you choose.

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Sole trader

Sole trader may be appropriate if you are going to start a business on your own. As a sole trader you are personally responsible for all the company's obligations, such as liabilities and agreements.

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Limited company

A limited company can be started by one or more individuals. When starting a limited company, you must have at least SEK 50,000 in share capital. Personal responsibility for the company's debts is in principle limited to the share capital. However, there are situations where you personally can be held responsible for unpaid taxes and contributions, etc.

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Trading partnership

A trading partnership is an alternative if at least two individuals or legal entities wish to start a business together. There is no requirement to invest capital, although the partners are personally, jointly and severally liable for the company's debts.

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Economic association

Three people are required in order to start an economic association. An economic association must promote the economic interests of its members. Personal responsibility for the association's debts is in principle limited to the capital invested by the members.

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Non-profit association

A non-profit association may operate a business. But the non-profit association must not be operated to promote the financial interests of its members. It must have a non-profit motive.

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Community association

A community association is a legal person formed to manage projects that benefit several real properties. Projects might include private roads, parking areas, playgrounds, bridges, broadband networks, stairwells and lifts.

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Compare different forms of business

Choose the form of business enterprise (pdf)
This overview gives you a summary of some legal differences between the most common business structures in Sweden.

Types of business - general questions

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