SAFE HARBOR (Date: 2008-02-16): The estimates given here are based on personal past experiences and with some inputs from locals. Use it for estimation purposes only.
Details pertaining to Taxation and Living Expenses in Sweden
Taxation:
The Tax % varies depending upon where you stay in Sweden. Higher the population in the Kommune(area/city), lower the tax % and vice versa.
To illustrate, the average income tax in Northern Sweden is the highest, since the human population here is the lowest. Therefore, the Government has to invest more per head to provide the uniform conveniences, translating into higher taxes.
In southernmost part of Sweden, (Like Malmo, Lund) where the population density is higher, the tax percentage is moderate
In Stockholm (Central part of Sweden) its higher
In Lulea (northern Sweden) it’s the highest.
The % varies from 28%-55%
But the biggest factor determining the tax % is the person's Gross Salary figure itself.
Like in many countries, higher your salary, higher is your tax liability.
Tax % in Lund for a person getting 325000SEK/annum = 31% (approx)
Tax % in Stockholm for a person getting 296000SEK/annum = 30% (approx)
Tax % in Lund for a person getting 400000SEK/annum = 33% (approx)
So, for all practical purposes, it is ideal to consider 32% as the Tax Liability
(Note: This Tax % again has components within called State Tax and Municipality Tax. I suggest all newcomers not to break their head on this. In order to arrive at their TAKE-HOME 32% is the number they should summarily deduct from their gross)
Summary: If people are deputed to Sweden, then they get to take home 67%-70% of the gross salary offered by most companies having their R&D HQ in Bangalore.
Living Expenses
Housing:
It’s not the money that’s an issue but getting a house itself for stay is the biggest challenge.
Sweden is an immigrant-friendly nation and there is a sizeable number of people coming here from all parts of the globe. Unfortunately, there are not enough houses/apartments available to sustain the demand.
Having said that, getting a place to stay in Lund is easier than getting one in Stockholm (voices from the locals here)
Average Furnished: An average apartment will be equipped with Bedding, Ordinary Sofa, sufficient lighting, heating/electricity, Microwave, potable water (water in Sweden is the sweetest; only Canadians can complain), heating pans/Gas connection ready, basic kitchen utensils/cutlery, other amenities like Cable television, Iron box/table, furnished bathrooms, WC, wardrobe, broadband internet, etc.
Good Furnished: Basic Furnished + More elaborate Wood work/Sofa, expensive glassware, Bar-counter, etc
Excellent Furnished: Good Furnished + Sky is the limit
All apartments will have common Washing area + dryer in the basement. One needs to book their slots to use the machines. Nobody charges extra for these basic services.
What decides the rent?
The area one lives in (whether in the heart of the city, excellent view or away from the city with maximum commute time)
The level of furnishing in an apartment (Average/Good/Excellent) will decide the pricing
The Size of the apartment
For a bachelor or a spinster, it is recommended that he/she takes up an apartment with one bedroom, one living room, kitchen & bathroom. The size of the apartment can be 35 sq.m. If they are unable to get one, then they should look for a Studio apartment, the average size is 25sq.m
For a person coming with his/her spouse and/or a kid, a larger apartment with one bedroom, one living room, kitchen & bathroom is recommended. Though it sounds like the same config as above, one can looks at apartments with carpet area greater than 50sqm. Note that, maintenance can be an overhead in Sweden and therefore people here like to live in such spaces which they can easily maintain. A very large house(in excess of 70sqm) is only recommended for a family comprising of family members in excess of 4.
Rents in Lund:
Range for Studio Apartment:
· 3500 SEK/month (average) – 5000 SEK/ month (good)
Range for 1 Bedroom+1living room+kitchen:
· 4500 SEK (average) – 7500 SEK/month (good)
Range for bigger Apartment:
· 7000 SEK(average) – 15000 SEK/month (super-luxurious)
For all calculation/estimation purposes, it is recommended that as expense towards house rent
· A bachelor/spinster considers 5000 SEK/month
· A married person moving with family(1+1+1/2) considers 8000 SEK/month
Rents in Stockholm:
I think one should be least worried about the rent and more concerned about getting an apartment to stay by itself. Latch on to every opportunity of getting an apartment. The pricing of rents are irrational here and you can get it for all sorts of prices. Once again, I recommend people to use the following estimation
· A bachelor/spinster considers 5000 SEK/month
· A married person moving with family(1+1+1/2) considers 8000 SEK/month
Food Expenses:
The assumption I make is that a techie is also a decent cook apart from the wonderful code he/she makes or breaks. Also, they may not be going out to eat more than 6-8 times a month, which will definitely cost him/her more.
The money spent on groceries is higher in the first couple of months as one is trying to settle in. Once a person reaches "steady-state", it will be lighter on the pocket.
The average expenses (Lund and Stockholm) on food for
· A bachelor/spinster can be 1500 SEK/month
· A married Person moving with family(1+1+1/2) can be 2500 SEK/month
The average meal for a person going out to a restaurant in Lund can cost 85SEK while the same in Stockholm can cost 110 SEK (based on personal experience). A dinner for 2 in Stockholm can cost around 400 SEK-500 SEK (Excluding alcohol).
Alcohol: They are expensive in this part of the world. Always buy them from Systembolaget (fair price shops) or go out with your friends and treat yourself.
Couple of glasses of beer in a Bar may cast you 104 SEK.
At systembolaget: A bottle of Famous Grouse can cost you 299 SEK.
Misc (mandatory) expenses:
Costs incurred due to purchase of items, that are more like one-time investments (decorative, non-electronic devices) can cost you anywhere between 200 SEK/month-500 SEK/month.
Getting a pre-paid mobile connection is easy and cost-effective. I recommend using calling cards, which are cheaper.
Commute Expenses:
Average expenses in Lund: 350 SEK/month
Average expenses in Stockholm: 680 SEK/month
One can always consider an additional 500 SEK/month for all calculation purposes going towards some unplanned/unexpected expenses.
Summary: After considering all this, I feel
A bachelor/Spinster in Lund should take 7500SEK/month as his monthly outgo
A bachelor/Spinster in Stockholm should take 8000SEK/month as his monthly outgo
A person moving with family to Lund should take 10000SEK/month as his monthly outgo
A person moving with family to Stockholm should take 11500SEK/month as his monthly outgo
FINAL NOTE: All expense considerations are on the higher side. There is a good probability that the expat can actually incur costs less than what is quoted here.
Traditionally, most companies have discouraged sharing of rooms amongst friends (which is healthy) and the above mentioned configurations were explained keeping that in mind. Sharing apartments would definitely bring down the expenses by 40%-50%.
PS: Under the social security in Sweden, education (crèche, schooling, etc) is free.
