Sweden Tax Agency Clarifies Danish PAL Tax Credit Rules for Installment Savings Under Nordic DTA

The Swedish Tax Agency Dec. 18 issued Position Statement No. 8-409960-2025, clarifying the Danish pension plan growth (PAL) tax credit rules for installment savings under the Nordic DTA. The statement clarifies that: 1) Danish PAL tax on returns from private installment savings can be offset against Swedish income tax when such income is taxed as capital in Sweden; 2) the savings aren’t considered pensions under Swedish law and are taxed as capital income; 3) the Nordic DTA and the Oresund Agreement authorize Denmark to tax income from Danish pension regimes for Swedish residents, but require Sweden to eliminate double taxation ...