Avkastning från incitamentsprogram som tjänsteinkomst - om finansiella instruments verkliga innebörd

Sammanfattning: Employees taking part in incentive programs are offered financial instruments which offer them parts of their employer’s successes. In Swedish tax law, the returns from these instruments are normally taxed as capital income and not as labour income. The employees benefit in kind of receiving the instrument to a discounted price is however taxed as labour income. This essay attempts to analyse whether the returns from a financial instrument given to an employee can be taxed as labour income, through a substance-over-form analysis. Since the Swedish income tax act does not specifically regulate such questions, the essay’s conclusions are largely drawn upon case law from the Swedish supreme administrative court. The essay shows that although incentive programs can offer real advantages for companies, current Swedish tax practice can also be abused for tax planning. Since capital incomes enjoy lower tax rates than labour incomes, there are tax incentives for employers to compensate their employees through returns from financial instruments (dividends, interest or selling profits) instead of cash salaries. There are presently multiple legal ways to sidestep the Swedish income tax act’s barriers against such abuse, although the frequency or magnitude of such abuse is unclear. The conclusion offered by the essay is that there are two substance-over-form answers to how returns from financial instruments may be taxed as labour income. Firstly, an analysis of the contract between the employer and employee may reveal that no financial instrument has been created, but rather an agreement over a future salary payment, calculated in a certain way. This could happen when the circumstances around, and the conditions set out in, the contract are clearly different from those typically seen in a financial instrument. Such indications may be that the employee is unable to freely sell the instrument, is entitled to payment only if the employment continues or is certain to receive a large profit despite assuming little risk or investment. According to the Swedish supreme administrative court’s case law, to reach such a conclusion is possible only in very unusual circumstances, and some types of instruments (such as shares) can almost never be seen as anything other than a financial instrument. Secondly, the return may be taxed as labour income if its payment to the employee is clearly not based upon his or her holding of the instrument, but rather upon the employment relation. Such a conclusion may be reached through analysis of the return’s characteristics and sheer size; if the return is directly connected to the employee’s work achievements or is too large to have been created by the instrument, it can be seen as income from labour rather than capital. Such a conclusion, too, is reachable only in quite special circumstances, and may be very hard to prove in court for the tax authorities. In conclusion, the essay finds that the Swedish tax system does allow for recharacterization of returns from financial instruments as labour income but only in very unusual situations, and that it does not effectively curb the possibilities for tax planning through incentive programs. Legislative initiatives may be warranted to eliminate such tax planning, or the incentives for it.