Pay more tax, Swedish fund association urges students

Swedish fiscal rules mean that those classified as students should try to earn more than the tax free threshold when seeking work, so as to ensure more rapid accrual of pension savings, according to figures published by the Swedish Investment Fund Association.

This is because the rules state that earnings up to a limit of SEK160,000 (€18,400) annually are treated differently, with the proportional amount going to first pillar pension savings versus taxes at its most efficient for annual earnings of SEK60,000 (€6,900), the Association said. The ratio is more than 2:1 in favour of long term savings benefits versus income tax at that point, according to its figures.

No tax is paid on earnings up to SEK18,000 annually, but that also means that students would not accrue any pension benefits, the Association suggested.


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