Sweden Tax Court Issues Advance Notice Clarifying VAT Liability for Employer-Provided Bicycles

The Swedish Tax Court Dec. 12 issued Advance Notice No. 52-23/I, clarifying that an employer provides services for remuneration when employees are given benefit bicycles in return for the deduction of part of their gross salary. The taxpayer, an employer, intended to provide benefit bicycles to its employees in exchange for reducing their gross salary. The taxpayer sought clarification as to whether the deductions from the employees’ gross salaries would be considered compensation for the provision of a service, for VAT purposes. The Tax Court clarified that the deductions would be regarded as consideration for the supply of services, because: ...