Permitting support for companies making dividend payments is being stopped. This is now being written into law in plain terms.
Following a meeting on Thursday between the Swedish Agency for Economic and Regional Growth and the Finance Committee, the government announced that crisis support to companies making dividend payouts will be stopped.
The government is now sending a referral to the Council on Legislation with clarification on which companies are entitled to state furlough support. And this does not include companies that issue dividends.
Tillväxtverket writes on its website that it will look more closely at the consequences of this, particularly for the many small businesses that have applied for the support.
In the government bill, the government writes that it was clear from the outset that dividend payments would not be permitted to receive support. The difference from previously is that the clarification now stands in black and white in the legal text. However, there are still unanswered questions, according to Hans Peter Larsson, tax manager at FAR.
– A dialogue is ongoing between the Swedish Agency for Economic and Regional Growth and the Ministry of Finance regarding the issues that are still unclear. We will have to wait for the outcome of this. The detailed questions are not always easy, but are nevertheless very important for companies and advisors, says Hans Peter Larsson.
He refers further to the special justification in the legislative text: ”Other similar payments are understood to mean In any case (red. kursiv) acquisition of own shares or reduction of share capital or reserve fund for repayment to shareholders.”
– What, for example, can be included in the expression ”in any case” in the special justification? We also did not receive an answer in the referral to the Council on Legislation regarding group contributions. There is also the uncertainty for the smaller companies that have applied for the support, which is evident from the information on Tillväxtverket's website, says Hans Peter Larsson.
Decisions on layoff support made by the Swedish Agency for Economic and Regional Growth so far are preliminary and will be reviewed. This means that companies that have submitted incorrect information may be liable for repayment.
The legislative amendments are proposed to enter into force on 1 June 2020.
This article is published in cooperation with the magazine Resultat
