Swedish Municipality’s Bike Provision to Employees Deemed Economic Activity

• A Swedish municipality’s provision of bicycles to employees in exchange for a gross salary deduction was considered an economic activity
• The Supreme Administrative Court ruled that the municipality acted as a taxable person in this arrangement
• The bicycle benefit was offered to all permanent employees with a rental period of 36 months
• The costs incurred by the municipality were covered by the salary deductions from employees
• The court referenced EU court practices, noting that the compensation level was set to cover the service provider’s ongoing costs
• The intention was for the gross salary deductions to fully cover the costs of providing the bicycles
• The offer was extensive and the activity was deemed to be of a continuous nature
• The ruling was made on November 29, 2024, case number 4096-24

Source: www4.skatteverket.se

Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.

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