Expenses for exercise related wellness activities can be compensated for within some limits for all companies except sole trader businesses and for partners in trading partnerships (Can be compensated for hired personnel, not the partners.). Rehab and preventive wellness treatments can be compensated in all businesses within some limits. It has to be the same wellness policy for all the employees of the company. In the rules there is a different treatment of wellness allowance (The company compensates employees for their wellness expenses) and perquisite (Wellness activities directly arranged or paid by the employer). There is no tax free wellness allowance for equipment, such as shoes or tennis rackets.
Frequently asked questions about wellness allowance:
You may pay tax-free compensation for wellness allowance for a maximum of SEK 5,000 per year and employee. If you pay SEK 5,001, the entire amount is taxable. As a basis for this, the employee must provide a receipt or invoice for the cost for which compensation is sought. The cost for the employee may be more than SEK 5,000, but it is only SEK 5,000 that the employer can compensate for the compensation to be tax-free.
Wellness allowance is a compensation that the employer gives to employees for costs that the employee has already incurred. A perquisite for wellness activities are activities that the employer directly decides about and pays for. In this case, the employee cannot decide for himself or herself how the money for wellness is to be spent. In contrast to the rules for wellness allowances, there is no fixed amount limit for what is considered to be of lesser value, and therefore tax-free. Since the cost of wellness activities varies depending on where you live and it is difficult to determine a market value for the activities, there is no fixed amount limit for perquisite wellness activities. So, a judgment as to whether the perquisite can be considered to be of lesser value and of a simpler kind must be made on a case-by-case basis.
All wellness should be handled as a perquisite and not as a wellness allowance, so you avoid the amount limit of SEK 5,000. Thus, invoices and receipts for the wellness activities should be issued to your company and not to yourself, and they should be paid directly from the company account and not by you personally.
For more information regarding exercise and wellness, please refer to the Swedish Tax Agency’s legal guidance. It provides detailed information on tax deductions for exercise and wellness activities, as well as guidelines for employers to ensure compliance with the relevant regulations.