VAT must be paid when a taxable person in this capacity sells a good or service within the country and the sale is taxable. However, this does not apply if the person is covered by a tax exemption for companies with a small turnover. A taxable person is one who conducts an economic activity independently. In order for someone to be a taxable person, both the requisites “economic activity” and “independent” must be met.
A member of a limited company’s board of directors who must perform a board assignment for remuneration for at least one year conducts financial activities . This applies regardless of the scope of the assignment and the number of board assignments that the member has. Whether the fee is fixed or variable is also irrelevant.
A board member who performs a board assignment in a limited liability company does not act in his own name, on his own behalf and at his own risk. This means that the business is not conducted independently in terms of VAT.
The Swedish Tax Agency’s view is thus that a member of a limited company’s board does not act in his capacity as a taxable person. VAT shall not be levied on the board fee. This applies to all work that takes place within the framework of a board assignment. This is also the case if the board member independently conducts another activity in addition to the board assignment. Even then, VAT should not be levied on the board fee.
Source: skatteverket.se
