Declaring a home sale: step by step

Selling a home, the sale goes in your income tax return. That covers profit or loss alike, and whether you pay tax at once or request deferral. Many find it sounds tricky, but basically it means filling in an appendix showing how you calculated the profit or loss.

Most important is having papers in order beforehand and reporting the right year. With purchase contract, improvement receipts and the agent’s settlement note saved, the filling itself is rarely hard. This guide walks you through step by step.

Which year, and when?

You report the sale the year after it happened, in the ordinary income tax return. Decisive is the contract date, the day the purchase contract was written, not moving day. Signing a contract in December one year with moving day next January, the sale still belongs to the contract’s year.

The return is filed in spring, normally with an early-May deadline. So a home sold this year belongs in the return you file next spring. Sold homes are often pre-filled in Skatteverket’s service, but you must add purchase price, improvement expenses and costs yourself. Skatteverket lacks that information.

K5 or K6: the right form

Which appendix you use depends on what you sold. Selling a small house (a house, terraced house, or a holiday home you own with land), use form K5. Selling a tenant-owner apartment, use form K6 instead. Note ”tenant-owner apartment” here means a share in a tenant-owner association, which most Swedish flats are, even sitting in houses.

Both forms serve the same purpose: working out your profit or loss and carrying the right amount to the return’s main form. Differences sit in details of what counts in. Selling several homes in one year, file one form per home. With several owners, split the deal by your shares: each reports their part on their own form.

The records you need

Before filling in, gather the material. You need: 1. sale price and date, from the purchase contract. 2. purchase price and date from when you bought the home. 3. agent fee and other selling expenses, from the settlement note. 4. improvement expenses: receipts and invoices for new builds, extensions and rebuilds plus any improving repairs.

For a tenant-owner apartment you also need any capital contributions paid toward the association’s amortisation during ownership, since they may add to the purchase price under certain conditions. Owned the home long and lost old papers, start searching in good time. Purchase contracts can often be retrieved via Lantmäteriet, and receipts sometimes reconstructed through tradespeople or bank transactions. Without records you risk losing deductions.

How you enter profit or loss

On the form you state the sale price at top, then subtract selling expenses, purchase price and improvement expenses. The result is either a profit or a loss. The form then helps calculate the taxable amount: at profit, 22/30 enters taxation; at loss, 50 percent is deductible.

The calculated amount carries into capital income on the main form. Using Skatteverket’s e-service, much of the transfer runs automatically once the appendix is filled. You immediately see how profit or loss affects your final tax. Always check the pre-filled amounts are right, and that you truly entered every deduction you hold before submitting.

How you request deferral in the return

To postpone capital gains tax for buying a new permanent home, request deferral in the same appendix where you report the sale. K5 and K6 each hold a special deferral section, where you fill in the new home’s details and how big a deferral you want. You can defer the whole profit or just part.

Do not forget your old deferrals either. Holding a previous deferral from a home sold before, it must be handled every year; it follows until reversed. Selling now without buying new, the old deferral returns to taxation, also reported in the appendix. Since deferral rules and time limits can change, always check the current rulebook at Skatteverket.

Common mistakes, and the next purchase

Some mistakes recur often. Many miss deducting improvement expenses because receipts are gone. Others mix up repairs, rarely deductible, with rebuilds, which are. A classic is reporting the wrong year, after moving day instead of contract day. And at a loss, some forget to report the deal at all, thus missing the deduction. A loss is declared just like a profit.

Easiest way to skip trouble next time is gathering records already when you buy your next home: save the purchase contract, and set aside every improvement receipt in its own folder from day one. Looking for the next home, you can place a buying brief with your requirements and budget on SökHem, and the matching actively looks for fitting sellers, even ones not yet listed publicly. This guide is an overview. Check details and amounts with Skatteverket ahead of your own return.