Investment account

Solution for active investors

Investment account enables to postpone the income tax obligation and reinvest the gain earned without paying the income tax in between.

  • Transactions with financial assets
  • Investment account report helps organise transactions
  • Investment account report data directly to the income declaration.

Changes in Income Tax Act in force from 01.01.2015:

  • Foreign currency conversion in the investment account is not deemed to be a pay-out.
  • Wider scope of financial assets. As an exception, assets not purchased for the money in the investment account may be added into the investment account system, e.g. gift and succession. The amendment expands the exemption to all similar situations, e.g. acquisition of financial assets as liquidation proceeds and holding option. Depending on thenature of transaction (no possibility to buy for money).

What is an investment account?

Investment account is a solution meant for active investors that enables the income tax obligation to be postponed if the money received from a sale of financial assets is transferred to the investment account. The money can be reinvested without paying the income tax in the meantime. Postponing the tax payment obligation is allowed only if the transactions made on the investment account involve financial assets. The obligation to pay the income tax arises only after you withdraw more money from the investment account than you paid into it.

How to open an investment account?

Investment account is an ordinary current account. It is reasonable to open a new current account in the branch of bank for using an investment account. In Swedbank's Internet Bank it is possible to give a separate name to the current account used as an investment account, such as “investment account”, which makes it easier to distinguish the account from other accounts.

Everyday transactions should be kept separate from investments

We do not recommend that investors use the current account they use for everyday transactions as the investment account, because it means that they would have to declare all incoming and outgoing payments in the account.

It is not recommended to enter into direct or standing order contracts or open bank cards for the current account used as an investment account, make everyday transactions from the account (payments for services and utility costs, etc.), cash transactions or select it as the servicing account for credit agreements (loans, credit cards, lease, etc.), as all entries not related to the acquisition of financial assets must be declared as a payment from the investment account and thus it might happen that income tax must be paid for a payment not related to investment.

Upon using an investment account it should be made sure that all amounts payable to the bank are settled on time, as a negative balance on one current account might in certain cases be covered from the means of another current account, including on account of the funds held in the investment account. In addition to keeping track of the credit agreements entered into in your name it is important to monitor contracts in which you are a co-applicant. As such a transaction is not related to acquiring financial assets, the obligation to pay income tax might arise again from the payments not related to investment.

Investment account transactions must be declared.

  • Investment account is an ordinary current account, but you have to inform the Tax Board on the income declaration if you use it as an investment account. The declaration shows all the contributions and payouts made in the investment account.
  • To make the declaration of investment account transactions easier we advise using the Swedbank investment account report , which helps to sum up the transactions made with financial and other assets on the investment account. The report data can be electronically sent to the declaration.

One or two securities accounts?

If you have a securities account and want to use the investment account system, you have to select your investment account as the current account that services your securities account. You can tie your investment account to your existing securities account or open a new securities account with an investment account at any Swedbank branch.

The number of investment accounts you can open is not limited and you can open them in the credit institutions of any European Union Member State or Organisation for Economic Co-operation and Development (OECD) member country. In addition to the restriction on territory, the circle of transactions that can be concluded with the money held in investment accounts is also limited. The exact list is available in the Income Tax Act.

An investment account is an additional option, not an obligation.

Two parallel systems are in use. Investors can also use the so-called ordinary system. The moment of taxation is the difference between the two: in the ordinary system, the obligation to pay tax arises after every sales transaction, but in the investment account system, you have to pay tax only after you withdraw more money from the investment account than has been paid into it.

Ask for advice

If you have any questions, don't hesitate to call our Investment Helpline on 613 1606 from 8:30 am to 6:00 pm Mon to Fri.