Deferring capital gains tax: how to postpone the tax

Selling a home at a profit, you normally pay around 22 percent of the profit in tax. But just swapping homes, selling one and buying a new one to live in, it can feel unfair for a big chunk of capital to suddenly go to tax mid-move. Precisely why deferral (uppskov) exists: a chance to postpone the capital gains tax instead of paying it at once.

Deferral does not make the tax disappear. It stays and falls due later, the day you sell the new home without buying another. But postponing it, and nowadays fully interest-free, can free serious money for the down payment on the next home. Here is how it works and when it pays.

What deferral really is

Deferral means waiting to pay the capital gains tax on your sold home, since you buy a new one to live in. Instead of paying the roughly 22 percent now, you park the tax on the new home. So the money stays in your housing instead of going to the state at once.

You can defer the whole profit or just part of it. It happens in the tax return the year after the sale. It is voluntary; you choose whether to postpone or pay off directly. And you can change your mind afterwards: regretting it, you can reverse the deferral and pay later, or conversely request deferral retroactively within the years Skatteverket allows reassessment.

Requirements for deferral

Deferral rights need some conditions met. The home you sold must have been your permanent home, your real home and not a holiday house rarely lived in. As a rule you should have lived there at least a year before the sale, or at least three of the last five years.

You must also buy a new permanent home and move into it. The purchase must happen within a certain window around the sale, as a rule the year before or after, with moving in by a set date. The new home must also sit inside the EEA, meaning the EU plus Norway, Iceland and Liechtenstein. So no Swedish deferral for a house purchase in, say, Thailand. Since exact time limits and home requirements can change, always check the current rulebook with Skatteverket ahead of your own deal. Yes, it is possible. Read our short answer to whether you can postpone capital gains tax.

The ceiling on deferral amounts

A limit caps how big a deferral you get. The ceiling is set per home, and profit above it must be taxed at once. Buying a cheaper home than you sold, you can usually defer only part of the profit. The deferral is then prorated by how much cheaper the new home is.

Buying an equally priced or pricier home, you can normally defer the whole profit up to the ceiling amount. Since the ceiling’s size shifted several times over the years, check the current level at Skatteverket before calculating. The point is deferral helps most in a roughly equal or upward move, and more limitedly moving to something much cheaper.

Interest scrapped in 2021: now deferral is free

The big change is that deferral interest was scrapped from income year 2021. Before, a deferral cost a yearly charge of roughly half a percent of the deferred amount, a running cost making many rather pay the tax directly. On a million-kronor deferral that meant several thousand kronor a year, year after year.

Since the scrapping, deferral is interest-free. That means postponing tax at no yearly cost at all. It made deferral far more attractive: in practice you hold an interest-free loan from the state on the postponed tax. Many who used to pay directly, or even settled old deferrals, have after the change instead let the tax sit.

Reversal: when the tax falls due

Deferral follows you as long as you live in owned housing only swapping between homes. Selling your home without buying a new one, or moving to a rental, the deferred amount returns to taxation. Then you pay the tax once postponed, plus any new profit on the latest home.

You may also voluntarily reverse all or parts of the deferral any year you like, for example a year with low income or losses to offset. Since deferral is nowadays interest-free, rarely any rush exists. Just remember the tax sits in the background: a latent debt eventually due, good to carry in long-term financial planning.

Pros, cons, and how you plan the purchase

The advantages are clear: you keep more capital for the next home, skip touching savings to pay tax mid-move, and nowadays pay no interest for the favour. The downside is the tax still falls due one day, potentially feeling heavier when reversed, especially if rules or rates shifted meanwhile. Some therefore prefer the simplicity of settling straight away.

How big your deferral gets, and how smoothly the swap runs, connects to how well you plan the next home’s purchase. Finding the right home in good time makes deferral time rules easier to hold. On SökHem you place a buying brief with your requirements and budget, and the matching actively looks for fitting sellers, even ones not yet listed publicly. Then you can plan the swap calmly instead of chasing time. Always check time limits, ceilings and rules with Skatteverket ahead of your own deal, since details can change.