Government Draft Legislation on Amendments to the 3:12 Rules – Emphasis on Increased Basic Amount and Simplified Calculations

On 23 May 2025, the government presented its legislative consultation paper, proposing amendments to the so-called 3:12 regulations. These proposals are largely based on the report submitted in June 2024, with certain adjustments.

The proposed changes include the replacement of the current two alternative calculation models – the simplification rule and the main rule – with a unified model. A basic amount of four income base amounts (IBB), equivalent to SEK 322,400 for 2025, is proposed to be distributed among the company’s owners based on their shareholdings. In cases of ownership in multiple companies, the amount will be proportioned, and the total basic amount may not exceed 4 IBB per individual.

Additionally, the possibility to consider a salary-based amount corresponding to 50 percent of gross salaries paid is retained. However, a standardized deduction of eight IBB per partner is introduced, which may, in practice, reduce the salary-based amount for some. Concurrently, the previous general requirement for shareholders’ own salary and the so-called four percent barrier are abolished, broadening the availability of the salary basis rule.

Another amendment pertains to the grossing up of acquisition cost. Only the portion exceeding SEK 100,000 may be adjusted upwards according to SLR + 9 percentage points. Conversely, the upward adjustment of the low taxed dividend room saved from previous years is removed. The waiting period for unqualifying qualified shares is generally shortened from five to four calendar years.

The draft legislation also includes restrictions related to the parallel investigation into the taxation of carried interest. A significant change is that salaries in companies owned through alternative investment funds may not be included in the salary base. This implies that a partner cannot include salaries to employees in the companies in which the fund has invested. However, the fund itself is not affected by this restriction – if the fund has its own employees, their salaries can be included, provided the other requirements are met. This limitation aligns more closely with the proposal put forward in the carried interest inquiry than the originally proposed changes to the 3:12 rules.

The government has refrained from advancing several of the more deeply discussed aspects of the initial proposal, such as the proposals for a common ceiling for salary taxation of dividends and capital gains, adjustments to the passive investor rule, and stricter requirements for control data to the tax authority. Instead, it is proposed that all shareholders holding qualifying shares should submit the K10 form in their income tax return, even in the absence of dividends.

Planned Entry into Force on 1 January 2026

The Council on Legislation will now provide its opinion on the proposal before the government can submit a bill to the Riksdag. However, some uncertainty remains, as the government emphasizes that the budget negotiations this autumn may affect the introduction.

A Simplification and Improvement?

The proposal is described as a simplification, and on several points – particularly the increase in the basic amount and the removal of the payroll deduction requirement – it could mean administrative relief and greater predictability. However, the new flat-rate salary deduction, among other things, could negatively impact some entrepreneurs who currently benefit from the salary-based allowance.

Want to Know More?

If you would like to understand how the proposal could affect you or your business, please do not hesitate to contact us should you want to discuss the consequences and your options for adjusting to the new rules.